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.
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.