Companies wishing to become a Certified B Corp will need to have or adopt governing documents which include a commitment to a 'triple bottom line' approach to business. In practice, for a typical business, this is likely to mean having an objects clause which states that it exists to promote the success of the business for the benefit of its shareholders but also to have a material positive impact on society and the environment. The governing documents of B Corps will also need to state that the board members of the company need to consider a range of 'stakeholder interests' - including shareholders, employees , suppliers, society and the environment - when making decisions and, critically, that shareholder value is not the supreme consideration but is one factor amongst the many stakeholder interests which board members need to take into account when running the business.
The value of meeting the legal requirement for B Corp certification is that it bakes sustainability into the DNA of your company as it grows, brings in outside capital, or plans succession, ensuring that your mission can better survive new management, new investors, or even new ownership.
The benefits of the legal requirement:
1. Give legal protection to directors and officers to consider the interests of all stakeholders, not just shareholders, when making decisions
2. Create additional rights for shareholders to hold directors and officers accountable to consider these interests
3. Limit these expanded rights to shareholders exclusively
What's the Process?
Determine whether you will need to amend your governing documents to meet the legal requirement for certification for your country of incorporation and corporate structure. See more details below for companies incorporated in Europe
If necessary given the results of the above, engage key board members, legal counsel, and investors about the usefulness and implications of adopting these legal changes for raising money, selling your business and directors' liability.FAQ for Directors & Investors
Obtain board approval of your planned amendment
Obtain shareholder approval of your board-approved amendment
If a corporation, file your amended articles with your Secretary of State within 1 year
The following Legal Roadmap provides a clear, step-by-step process to change the DNA of your business by expanding the responsibilities of your corporation to take into consideration the interests of all stakeholders, not just shareholders.
For all other countries
Please contact us at email@example.com and we will work together to figure out next steps.