Performance Requirement for Pending B Corps

Guidance on Meeting the Performance Requirement for Pending B Corps

In order to graduate from a Pending B Corp to a Certified B Corporation, a company must have a verified score of at least 80 on the assessment within 12 months after achieving Pending status.  

The purpose of the verification process is to ensure that every published B Impact Score is an accurate portrayal of the company’s current practices and that each individual company’s assessment is based on the same interpretations of the assessment.   

The steps to get a verified score are as follows:

A)  Update and Submit Your Provisional B Impact Assessment

See below for tips on how to fill out your provisional BIA accurately.

B)  Complete an Assessment Review

On the phone with a B Lab Standards Associate, you will review questions from the assessment that may have been difficult to answer or were unclear.  This will enable you to refine assessment answers so they fit the intent of the questions and to make sure your score accurately captures the unique impacts of your business.  On average, review calls take about 60-90 minutes. 

Because the B Impact Assessment is an imperfect tool, score changes nearly always result from the review call.  The greatest score changes often occur in the Impact Business Model section of the Assessment (please read below additional information on the IBM section of the Assessment).  While the average score change on the full Assessment is -7 points, the range of score changes can often be -30 points to +15 points.     

C)  Submit Supporting Documentation

If at the end of the Assessment Review the company’s score is 80 or above, the Assessment will randomly select 8-12 affirmatively-answered, often heavily-weighted, questions and ask you to upload documentation that demonstrates evidence of those practices. The B Lab Standards Team reviews the submitted documentation to verify the selected answers.  

Score changes during document review average -2 points.  

Tips for Completing a More Accurate Provisional Assessment

Because of the potential for significant score changes during the verification process, it is possible for an initial self-assessment score of over 100 to result in a final verified score below the minimum score of 80 required for B Corp certification.  The best way to minimize the variance between a self-assessed score and a verified score is to consider the following:

(1)    Answer questions objectively:  All answers should be based on objective evidence and must be verifiable.  Ask yourself, if documentation were requested for this question would it be possible to provide sufficient evidence?  If no, answer negatively.  This means that informal practices do not receive credit in the assessment.  

Example: If managers provide periodic conversational feedback to employees regarding performance, the company should not get credit for having a formal performance review process.

(2)    Use only the appropriate time period: Answers should refer to the current time, or if more appropriate the most recent 12 months or last fiscal year.  If something was not done in the specified time period, either because it was done years before or will be done some time in the future, answer negatively (for the time being).  

Examples: If the company used to have an independent board member, or is planning on appointing one in 6 months, the company should not select that they have an independent board member.  If a company does not have earned revenues, the company will not receive any “beneficial product” credit because the impact has not yet accrued.  (See section below on Impact Business Models.) 

(3)    Limit the scope of the assessment to the company itself:  Questions apply only to the operations of the company, and, when specified, the practices of the company’s suppliers.  Answers should not be based on the activities of individuals affiliated with the company but acting outside of the company itself.  

Examples: If the founder/CEO of the company donates money to charity in her name, this amount should not be included in charitable giving calculations.  Also, if employees bike to work by their own choice, the company should not get credit for a program incentivizing employees to bike to work.  

(4)    Don’t double count.  Remember that each question is intended to ask about a distinct impact/best practice, and should therefore be answered distinctly and independently of other questions in the assessment.  

Examples: Allowing workers to take time off for community service should not be counted in both “worker benefits” questions and “community service” questions.  

(5)    Be conservative.   When uncertain, answer questions in a way that is least likely to overstate impact.  

Examples: If you know that somewhere between 30% and 50% of significant suppliers are owned by women or underrepresented populations, answer 30%.

Impact Business Models:    

The “Impact Business Models” section is one of the unique elements of the B Impact Assessment (BIA).  The BIA not only assesses the impact of a company’s operational practices typically covered by standard ESG, sustainability, and CSR tools, but also attempts to capture specific sets of intentional business models designed to create social and/or environmental impact through a company’s products or services, target customers, value chain, ownership or operations.  

It is important to note that Impact Business Models are rare.  Many companies do not have an Impact Business Model.  Even among those that do, they often receive credit for one or two, and that is often partial.

Impact Business Models are determined by company mission/intention, particular stakeholder groups and populations targeted, measurable and measured outcomes, and third party certifications.  Examples include: certified organic food products, education products for low-income schools, “Buy One Give One” charitable giving programs, Fair Trade certified products, etc.   Keep in mind point (5) above and review further potential Impact Business Models with the support of your B Lab Standards Associate.  

Within an Impact Business Model, be sure to answer based on the particular stakeholder group being referred to.  For instance, a company should only answer that their product promotes economic opportunity if the economic opportunity is being delivered to the customers that are purchasing the product (i.e. job placement services).  If the company is purchasing from fair trade suppliers, do not select “economic opportunity” in the product section; instead, select beneficial supply chain.  

Within product Impact Business Models, revenues from products should not exceed 100% (and credit will only be given for one primary impact PER product line).  For example, a nursing school should not select 100% of revenues for education AND healthcare.  If on the other hand, a company provided two distinct products—an education program about cancer and a cancer treatment drug—then include the % of their revenues from sales of the education program in Education and the percentage from sales of the drug in Health.  

For a more in depth examination of the Impact Business Models, please review the Impact Business Model section of the assessment itself, the Assessment methodology page, as well as the attached appendix which includes more examples and hypotheticals to enable you to project better how the B Lab Standards Team is likely to view your company’s Impact Business Models.