PER­SPEC­TIVE: A NEW WAY TO DO BUSI­NESS

At­tract­ing and re­tain­ing a cre­ative work­force is a per­pet­ual chal­lenge. The an­swer may lie in B Corps, a cer­ti­fi­ca­tion process that’s fo­cused on the so­ci­etal im­pact a com­pany has.

The Peak (Hong Kong) - - Contents - NATALIE CHAN

B Corp as the new move­ment for com­pa­nies to at­tract and re­tain a cre­ative work­force

All Hong Kong cor­po­ra­tions share a chal­lenge: how to at­tract, nur­ture and re­tain the best work­force for their fu­ture. The op­tions for young tal­ent are ever more var­ied and far­reach­ing: Shen­zhen and Sin­ga­pore at­tract in­no­va­tors, Europe and the US at­tract uni­ver­sity stu­dents, and the grow­ing ‘gig econ­omy’ is en­abling more young pro­fes­sion­als to em­brace en­trepreneur­ship.

In­creas­ingly, those that want to go into busi­ness in Hong Kong are ask­ing more prob­ing ques­tions of po­ten­tial coun­ter­parts. Who are their ben­e­fi­cia­ries? What are their im­pacts? What value are they re­ally bring­ing to so­ci­ety? This new breed of busi­ness mind is mo­ti­vated by ris­ing aware­ness of en­vi­ron­men­tal crises threat­en­ing health and liveli­hoods; from air pol­lu­tion to re­source con­straints and the im­pacts of global warm­ing. Trans­parency and ac­count­abil­ity are now more than just a ‘nice-to-have’ for a busi­ness, and are pro­gres­sively be­com­ing es­sen­tial.

Yet, while frame­works such as the Global Re­port­ing Ini­tia­tive sup­port com­mu­ni­ca­tion of busi­nesses’ eco­nomic, en­vi­ron­men­tal and so­cial im­pacts, they do not as­sess per­for­mance. A grow­ing range of stake­hold­ers – from en­trepreneurs to in­vestors and con­sumers – seek ways to de­ter­mine which cor­po­rates are ac­tively be­com­ing a force for good in so­ci­ety.

I felt these mount­ing pres­sures very keenly over the last ten years, in my roles lead­ing the cor­po­rate re­spon­si­bil­ity and sus­tain­abil­ity teams for Swire and sub­se­quently Hongkong and Shang­hai Ho­tels Group. Such ques­tions are cer­tainly not easy to ad­dress. But I be­lieve busi­nesses can achieve the ul­ti­mate goal: To de­liver value, not just to share­hold­ers, but also to so­ci­ety as a whole, in­clud­ing the en­vi­ron­ment.

A trans­for­ma­tive tool for achiev­ing this has emerged over the last decade and is now gain­ing mo­men­tum: the B Cor­po­ra­tion cer­ti­fi­ca­tion. Ad­min­is­tered to busi­nesses that un­der­take sus­tain­able, eth­i­cal prac­tices, B Corps has spread around the world and is in­creas­ingly at­tract­ing larger, pub­lic com­pa­nies.

The B Corps cer­ti­fi­ca­tion is ad­min­is­tered by B Lab, a non-profit based in Penn­syl­va­nia. B Lab’s co-founders Jay Coen Gil­bert and Bart Houla­han started their jour­ney by launch­ing Amer­i­can sportswear brand And1, but rapidly be­came shocked and dis­ap­pointed at their own story. All the work that had gone into help­ing the com­pany cre­ate shared value (ways of gen­er­at­ing busi­ness op­por­tu­ni­ties from so­cial is­sues) went out of the win­dow when it was sold and the man­age­ment changed. Gil­bert and Houla­han, along with long-time friend and pri­vate eq­uity in­vestor An­drew Kas­soy, de­cided to come to­gether to cre­ate a method for de­liv­er­ing shared value to be­come part of a com­pany’s core struc­ture.

B Corps is a frame­work and cer­ti­fi­ca­tion that as­sesses cor­po­rate per­for­mance across five as­pects of op­er­a­tions: gov­er­nance, work­force, com­mu­nity (in­clud­ing share­hold­ers), en­vi­ron­ment and busi­ness model. The as­sess­ment process is rig­or­ous, chal­leng­ing com­pa­nies to iden­tify ex­actly where they are in terms of cre­at­ing so­cial, en­vi­ron­men­tal and eco­nomic value in the world.

Since the first B Corp com­pany was cer­ti­fied in 2006, over 2,200 com­pa­nies from 50 coun­tries and 130 in­dus­tries have been cer­ti­fied.

B Corp is now a global move­ment that pushes the bound­aries for lead­ing com­pa­nies to un­cover what it means for them to cre­ate shared value, us­ing their busi­ness as a force for good. It sup­ports busi­nesses to be prof­itable through cre­at­ing pos­i­tive so­cial, en­vi­ron­men­tal and eco­nomic im­pact. The cer­ti­fi­ca­tion also makes sure that these pos­i­tive im­pacts aren’t a sideshow or a box-tick­ing ex­er­cise, but that they are strate­gi­cally em­bed­ded into what the com­pany is do­ing at ev­ery level.

I be­lieve that there is no cookie cut­ter so­lu­tion on how cor­po­rates can cre­ate shared value for so­ci­ety and the com­pany, so it’s great to see that the B Im­pact As­sess­ment is tai­lored to a com­pany’s busi­ness na­ture, size and lo­ca­tions. What ac­tu­ally makes B Corps trans­for­ma­tive is the rigour of the process, rather than sim­ply the cer­ti­fi­ca­tion it­self.

While the move­ment is just begin­ning in Hong Kong, Taiwan is forg­ing ahead, with 18 reg­is­tered B Corps com­pa­nies and some 120 in the pipe­line. The 2017 B Corps Asia con­fer­ence, Con­verge for Im­pact, was held at the end of Au­gust in Taichung in western Taiwan, with speak­ers in­clud­ing am­bas­sadors from

China, Ja­pan, Korea and In­done­sia, and from multi­na­tion­als in­clud­ing Danone, which this year be­comes the world’s first pub­licly traded B Corps.

There are a wide va­ri­ety of agen­das among cer­ti­fied B Corps, from the or­ganic and fair trade choco­late brand Al­ter Eco, to the in­te­grated ar­chi­tec­ture and con­struc­tion com­pany South Moun­tain along with B Corps-cer­ti­fied heavy­weight multi­na­tion­als such as Brazil­ian cos­met­ics brand Natura, Unilever, Danone, Camp­bell’s Soup, Sun­corp and Ban­colom­bia (one of the largest banks in Latin Amer­ica). To­gether, they are all seek­ing to de­velop the cer­ti­fi­ca­tion process for pub­lic and multi­na­tional com­pa­nies.

There are also straight­for­ward le­gal firms and ac­coun­tan­cies with B Corp cer­ti­fi­ca­tion, such as Tai­wanese law firm Win­kler Part­ners. The firm recog­nises that its col­leagues and com­mu­nity are es­sen­tial to pro­vid­ing qual­ity le­gal ser­vices in the long term, so it nur­tures them with a rooftop gar­den in down­town Taipei, on­site care for its em­ploy­ees’ chil­dren, and on­go­ing ed­u­ca­tional op­por­tu­ni­ties for em­ploy­ees.

So far, Hong Kong has four cer­ti­fied B Corps: the so­cial en­ter­prises Ed­u­ca­tion for Good and Di­a­logue in the Dark, co-work­ing space The Wave, and my sus­tain­abil­ity con­sult­ing com­pany, PIE Strat­egy. The city now also has its own B Corps Con­sult­ing Group, a train­ing and net­work­ing com­mu­nity led by pas­sion­ate change­mak­ers, in­clud­ing Dr KK Tse of Ed­u­ca­tion for Good and my­self.

B Corps make sense for so­ci­ety and busi­ness, and the process speaks to the bot­tom line for at least three good rea­sons. Firstly, B Corps com­pa­nies ex­pe­ri­ence re­mark­ably low staff turnover, thanks to the em­pha­sis on work­force well­be­ing. This trans­lates into di­rect sav­ings on the cost of hir­ing and train­ing, as well as guard­ing against loss of pro­duc­tiv­ity due to low mo­ti­va­tion and morale in high turnover en­vi­ron­ments. Se­condly, high lev­els of in­ter­nal trans­parency sup­port ef­fi­ciency and ex­pose op­por­tu­ni­ties for in­no­va­tion. Fi­nally, the global B Corps com­mu­nity of­fers a fast track to pi­o­neer­ing col­lab­o­ra­tion. B Corps mem­bers are ded­i­cated to im­ple­ment their vi­sions, so why not work to­gether?

It all adds up to a new, bet­ter way of do­ing busi­ness.

SINCE THE FIRST B CORP COM­PANY WAS CER­TI­FIED IN 2006, OVER 2,200 COM­PA­NIES FROM 50 COUN­TRIES AND 130 IN­DUS­TRIES HAVE BEEN CER­TI­FIED

Natalie Chan is man­ag­ing di­rec­tor and prin­ci­pal sus­tain­abil­ity con­sul­tant at PIE Strat­egy, one of Hong Kong’s first cer­ti­fied B Corps.

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