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What is a B Corporation? Rising Above Profit – The Triple Bottom Line

The complexity and challenges of a globalized human society are obvious to anyone who is paying attention. From climate change to political strife to global health crises, the scope of issues to manage has grown significantly. Humans did not evolve in groups of millions or billions, so our minds which are accustomed to village-sized problems need to adapt in the face of planet-sized problems.

Capitalism, warts and all is the engine that has driven the proliferation and material success of human society, and one common, familiar feature of capitalism is the profit-driven corporation. Many of the largest corporations have achieved their version of success by single-mindedly prioritizing financial success for their shareholders. You have more than likely heard the mantra of such companies, not to mention the majority of investors and many business owners: the bottom line.

As capitalism has matured, however, a new breed of organization has started to flourish as mass communication has allowed conscious business owners to connect and collaborate. New entities like Low-profit Limited Liability Companies, Social Purpose Corporations, and Benefit Corporations have begun to form with the express purpose of changing the form and structure of the very way that business is done in the modern world.

One such corporate form defines the very DNA of SkyFire Energy: Certified B Corporation. B Corporations, overseen by the nonprofit B Lab, is a community of 3,301 companies in 71 countries, working in 150 different industries. These businesses have made tangible, real commitments, financial and otherwise, to structure themselves in such a way that their company rises above the bottom line, and creates a triple bottom line: social and environmental stewardship, as well as financial success.

Businesses who subscribe to the B Corporation Declaration of Interdependence wish to use the powers of commerce as a force for good in the world around them. They strive to be the change they seek in the world. They operate as if people and place matter. They aspire to do no harm and benefit all. To do this, they recognize the inherent interconnectedness of our world and the ways in which people and communities depend on each other.

 

How to B Corp

In a piece for the Harvard Business Review called Why Companies Are Becoming B Corporations, authors Suntae Kim, Matthew J. Karlesky, Christopher G. Myers, and Todd Schifeling write: “Increasingly, corporations are donning the persona of a responsible citizen, while continuously performing practices to maximize profit. These contradictory tendencies motivate traditionally “green” and ethical businesses to unite and stake a claim to their authentic difference, fueling the growth of B corporations and other new types of organizations. For mission-driven businesses, these alternative forms of organizing provide an opportunity to better communicate their commitment to society and to the natural environment in a world where everybody claims to be “green” and “good.”

This phenomenon is sometimes called “greenwashing,” where it seems every multinational company is rebranding and spending to emphasize their community stewardship, while never fundamentally changing their business practices to create lasting, tangible positive change in the communities they operate in.

B Corporations are a way to fight greenwashing since they represent not only a fundamental reorganization of companies’ legal structures and commitments but also a community of accountability, administered by an independent Standards Advisory Council. B Corporations do not simply say they are going to do good and do right by their communities.

Certification as a B Corp requires an in-depth certification process which is renewed every three years – businesses and nonprofits are rated on their impact in five areas – governance, workers, community, environment, and customers.

 

The Process

There are three steps to the B Corporation certification process: assessment; legal considerations; and verification. The B Impact Assessment (BIA) is a free online tool that assesses a company’s day to day operations and business model to provide a numerical score from the results of 200 questions. The BIA compares a company’s processes and methods — what they do and how they do it –against the standards created by the independent Standards Advisory Council and provides a snapshot of how that company compares and provides road maps and tools to set goals to improve.

Once a company has their B Corporation score and has started the certification process, they need to enact specific changes to their legal structure in order to qualify as a B Corp. To spare all the legalese, a company needs to work within the confines of the Canadian Business Act to make specific changes to their business’ legal framework that legally compel them to act in the best interests of their employees and community, as well as shareholders. B Lab provides specific legal language tailored to countries all over the world to streamline the process for anyone who applies, and to make the legal compliance relatively standard across the large community of B Corporations.

If a company reaches the 80 point minimum on their B Corporation assessment, they move on to verify the information they provided with B Lab. During the Assessment Review, B Lab connects over the phone to discuss the BIA and the company’s response to a set of six to fifteen questions randomly selected during the BIA about day to day operations. This conversation, as well as background checks and any additional documentation, is the point when B Lab confirms everything shared in the BIA. This process of auditing responses helps to ensure the credibility of the entire B Corporation structure. Certification as a B Corporation is no small achievement. the vast majority of companies that apply do not meet the requirements for certification. SkyFire’s inspiration to become a B Corp was founded in other social ventures in Western Canada as well as our fellow Amicus members. In fact, Amicus Solar member South Mountain Company Inc is the highest rated B Corp in the world!

 

Further Considerations

B Lab takes special consideration to keep the entire B Corporation structure and process both transparent and meaningful. Aside from any sensitive information shared in a Disclosure Questionnaire, every certified B Corporation shares the results of their B Impact Report on
bcorporation.net. B Corps also must complete the recertification process every three years, which ensures engagement with the process and gives companies opportunities to set goals and improve their B Corp related operations goals.

B Lab also selects 10 percent of their community each year for independent Site Reviews, between 6 and 10 hours of virtual or in-person assessment to verify certification standards and requirements are being followed as stated by the company.

 

Our Take

Our B Corp status defines the SkyFire ethos, so we’ve taken pride in orienting our operations around those principles. One great advantage we have in the process derives from the nature of our business: renewable energy is by its nature intended for positive change in the world. By orienting our working lives around the goal of mitigating climate change and providing energy independence to our communities, every day our staff works, we actively contribute to both people and place.

Selling and installing solar energy isn’t enough to become a B Corporation of course. In our journey towards community betterment, our leadership team decided in 2018 to structure SkyFire Energy as an Employee Stock Ownership Program (ESOP). As per Investopedia’s definition, an ESOP is an employee benefit plan that provides employees with an ownership interest in their company. An ESOP dovetails perfectly with B Corporation principles since it ensures that SkyFire employees are working in the best interest of SkyFire Energy — our
sixteen employee-owners are extra motivated since they partly own the company they are developing and putting their mental and physical equity into.

The ESOP model doesn’t just motivate the employee-owners. Any non-owning employees of an ESOP also feel more connected to their company’s wellbeing, since they work side by side with the owners. They can see each and every day that their employers are working in the best interest of every other person in the office or in the field. That alignment of financial investment and diverse ownership within the workforce lays everyone’s motivations out on the table, and keeps people not just working hard, but working for the right reasons and very happy to do so. The ESOP benefits our B Corporation status by ensuring the financial rewards of everyone’s hard work is spread beyond simple wage compensation.

Our two large structural wellness angles, a renewable energy business, and an employee share ownership program, aren’t the end of our search for B Corporation status, and we continuously update our processes to achieve maximum good. We earned Climate-Smart status for 2019 by engaging in a detailed inventory of our greenhouse gas emissions and carbon footprint. During three training sessions, members of our leadership team learned how to measure our carbon output, took steps to reduce that output through the day to day operations, and ultimately found ways to leverage that effort and success to continue building momentum for SkyFire’s daily operations to lead our community in positive sustainability. All of these efforts are in conjunction with our ongoing day to day efforts to utilize supply chains that are as environmentally friendly as possible, divert recyclable materials whenever possible, and purchase materials for our operations through Amicus Solar, a solar co-operative which enables more economical financial operations for every solar company within its ranks, and enables viable solar energy operations around North America and by extension the world as we collectively invest in the technology.

SkyFire Energy also actively fosters a positive culture within the company through celebratory and social engagements. Those celebratory moments include monthly awards based on SkyFire’s six defining principles of Integrity, Accountability, Perseverance, Safety, Celebration and Innovation; weekly social get-togethers on Thirsty Thursdays (when public health policy allows!); social engagements throughout the year at places like The Rec Room; and consistent moments of recognition and excitement when notable achievements, anniversaries, and occasions pass through employee ranks.

Through such efforts, large and small, SkyFire Energy has fostered an ethos and company structure that we feel enables the health and wellness not just of our staff and customers, but also that of the community we live and work in. We subscribe to B Lab’s Declaration of
Interdependence, and live that principle every day we operate.

 

 

Article was written by James Nason – Electrical Apprentice for SkyFire Energy

 

 

Certifications & Associations

APEGA CanSIA Amicus Solar Cooperative B Corp Certified Tesla Certified Powerwall Installer

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