Version 6 of the B Impact Assessment

A Year in Review
By B Lab Global
March 2, 2020

Released just over a year ago, Version 6 (V6) of the B Impact Assessment marked the culmination of B Lab’s most extensive stakeholder engagement and testing process in the assessment’s over 10 year history, including input from Regional Advisory Groups, alpha and beta testing, and a public comment period that was available in multiple languages for the first time (English, Spanish, Portugeuse, French, and Italian).

Used by over 70,000 companies around the world, the B Impact Assessment is B Lab’s free and confidential online tool for businesses to measure and manage their impact on their workers, community, environment, and customers. The assessment is updated every three years in order to accommodate new and innovative practices, respond to the feedback of its users, more accurately assess the impact of all types of businesses, and ultimately move us towards an economy that works for everyone. 

While the addition, removal, and revision of content is centered around continuous improvement, it inevitably results in score fluctuations for users. This presents a challenge for those looking to understand how a company’s performance compares across different versions of the assessment, or what the implications of a new version might be on a company’s score.

In order to provide clarity around how these changes will affect users, here are responses to some of the most frequently asked questions about V6 based on early insights from a full year of scoring data.

How are companies performing on V6 of the B Impact Assessment?

At the highest level, average scores for V6 are slightly lower when compared to V5. Currently, the V6 average of 90.9 points is approximately 3 points lower than the average score on V5. 

This average is based on the B Impact Assessment scores of B Corps—those that have been reviewed and verified by B Lab as part of the B Corp Certification process—in order to control for accuracy of scores. B Corp Certification requires companies achieve a minimum verified score of 80 points, which means that the average score reported here is higher than that of a typical B Impact Assessment use.

Is this score change different from previous versions?

According to historic assessment data from V3 until now, the average B Corp score has decreased with each new version. With this context, the difference in average score between V5 and V6 (-2.89 points) is consistent with what we would expect.

Does this mean the B Impact Assessment is getting harder?

The bar graph above would indicate that the B Impact Assessment is getting more rigorous with each new version. While producing a lower average score is not an objective of the version development process, improving the assessment involves removing or revising questions that do not differentiate company performance to better reflect current best practices, which continue to raise the bar.

We also attribute this trend to a shift in the types of companies completing the B Corp verification process. As the number of companies has grown with each of the previous three versions, we have noticed an increasing proportion of companies that are at an earlier stage in their impact improvement journey, and tend to score lower than early adopters.

What is the expected score change for companies moving from V5 to V6?

If you’re a current B Impact Assessment user you might be wondering, “How will V6 affect my score?”

Despite the average score for each version decreasing over time, B Corps tend to see an increase in score from version to version if they were previously certified. The average change in score from V5 to V6 was +1.03 points among previously certified B Corp assessments, similar to the average changes from V4 to V5 (+1.46 points) and V3 to V4 (+1.24 points).

It stands to reason that more active users of the B Impact Assessment, such as B Corps, will tend to improve on new versions, given that it is designed to be both educational and aspirational. For example, the assessment offers users customized improvement reports, best practice guides, and the ability to set improvement goals for specific questions as they move through the assessment. While more analysis is needed to explore whether the average increase score among B Corps is a result of real performance improvements or other factors, this initial analysis is encouraging.

Another key observation is that the range of score changes that an existing B Corp might experience is quite large. A handful of companies have seen fluctuations of plus or minus 30 points, but of the 108 B Corps that have been certified on V5 and V6 thus far, most companies do not see a change of more than 10 points. This degree of variability is not abnormal—the average absolute change from V5 to V6 (10.9 points) is comparable to the same metric from V4 to V5 (10.0 points).

We understand that score fluctuations may pose a challenge for B Corps recertifying on a new version. For this reason, B Lab offers remediation opportunities for B Corps that fall below the 80 point performance requirement during their recertification process, allowing them to implement improvements and maintain their certification.

Why did my score change on V6?

While it is relatively straightforward to analyze how scores are changing, it is more challenging to understand why. We have observed a number of factors that might affect a company’s score on V6:

1) New and revised assessment content Revisions to questions in the B Impact Assessment naturally cause score fluctuations between versions, and will affect some users more than others depending on the company. For example, V6 introduced new criteria for when independent contractors should be considered “workers,” expanded the breadth of supply chain and governance questions for large companies, and changed the requirements for when a company’s Board of Directors earns credit in the assessment. A summary of all of the changes in V6 can be found here.

2) Changes in structure and question score weighting V6 has a new goal structure, which is more aligned with other relevant initiatives like the Sustainable Development Goals and the Global Reporting Initiative. As a result of this change, the point worth of certain questions may fluctuate from V5 to V6, even if the question itself remains identical. We conducted extensive analysis during the development process in order to minimize this type of change—in fact the average expected change was approximately 1 percent—but it is still a relevant factor that may affect a company’s score.

 

3) Real changes in company performance The B Impact Assessment is updated every three years, and a lot can change at a business during that time. A company may launch or retire product lines, change the benefits package offered to workers, open offices in new countries, or adopt new environmental management policies. Any of these changes could have a significant impact on a company’s workers, communities, customers, and the environment. The B Impact Assessment is designed to help measure these changes over time, so that companies can manage their impact on all stakeholders as they evolve.

What’s next?

B Lab’s goal is to continuously improve the B Impact Assessment while simultaneously balancing continuity for our users. We’ve started with this quantitative analysis of V6 in order to offer more transparency about the scoring implications of new versions. We will be working on several projects to improve the clarity of the B Impact Assessment throughout 2020, including adding to our online knowledge base and improving detailed guidance on how to answer questions in the assessment.

Later this year, we will also kick off projects to review the substantive feedback that we’ve received about the content in V6, and re-evaluate our standards per the recent global climate commitment announced by 500+ B Corps to achieve net zero carbon emissions by 2030. As part of this ongoing work, we’d love to hear your feedback both on V6 of the B Impact Assessment and how we can continue to improve our standards. You can leave feedback on individual questions directly in the Assessment by using the “Feedback” button, or send general feedback to  standardsmanagement@bcorporation.net.

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