Are you actually a B-Corporation? New type of corporation for businesses who do good.

Maryann Lawrence, Startup Rep, Direct Incorporation

You’ve heard of LLCs, S-Corps and C-Corps, but are you aware of the new legal entity out there called B-Corp? A B-Corp, or Benefit Corporation, is a new form of incorporation that legally recognizes companies that “do good” AND make a profit.

Take Dansko for example. You may have seen this brand at your local department store. Dansko makes dress shoes, sandals and boots, but it does it in a way that uses a for-profit business model to affect social change. Its office building is LEED® certified, it hosts West Grove, Pennsylvania’s only Community Recycling Center, and it pays its employees to take time off to volunteer, as well as match its employees’ salary and gives that amount to the organization at which they volunteer. For these reasons, Dansko qualifies for B-Corp status.

The benefits of a B-Corporation:

• B-Corps enjoy the brand differentiation of being recognized as socially beneficial corporations
• B-Corps enjoy discounts from B-Corp service partners
• B-Corps can attract outside investors, while non-profits cannot
• B-Corps enjoy enhanced collaboration with other businesses that share their goals
• B-Corps can hold their directors accountable for decisions that impact their mission to meet social and environmental performance standards

How to become a B-Corporation:

1. Take, and pass, the B Impact Ratings System
2. Complete a telephone interview with B Lab
3. Amend your governing documents to adopt the B-Corp Legal Framework
4. Put your John Hancock on the B Lab Term Sheet to make it official

Today it’s only available in a few states: California, Hawaii, Michigan, New York, North Carolina and Pennsylvania.

Have a question about incorporating your business? Feel free to post it below and I will try to answer it. Thanks! – Maryann