August 29, 2022
Recognizing the ongoing conflict in the region and the continued complex questions that it raises for evaluating businesses’ responses, B Lab’s Board of Directors has approved the extension of the moratorium on new B Corp Certifications for companies operating in Russia and Belarus until 2023. In 2023, it is expected that more detailed standards will be developed that all B Corps will be required to meet in response to the conflict.
In March 2022, B Lab imposed a moratorium on certifying companies operating in Russia and Belarus. During the moratorium period companies operating in Russia and/or Belarus are required to suspend their operations (defined as any business activity) in those locations while also avoiding the negative potential impacts of their decision by maintaining their support for their key, non-complicit stakeholders in Russia or Belarus, by for example continuing to financially support their employees and not terminating their contracts. More details about the initial moratorium and its rationale can be found in B Lab’s formal statement.
Since the implementation of the moratorium, the invasion has continued, with untold loss of life and human rights violations. Many companies have spoken out and taken action in response, both in supporting humanitarian efforts in Ukraine and condemning the actions, and even making divestments from Russia. At the same time, human rights experts have acknowledged continued need for more action from the business community, highlighting the difficulty in interpreting the degree to which companies are taking appropriate action in response, the degree and impact of those decisions, and even the need to reevaluate what should be expected from businesses in such circumstances.
These complexities signal the need for more thorough standards to be established for both existing B Corps and those who are interested in pursuing B Corp Certification moving forward. The moratorium will be in effect until those standards have been developed.
While all businesses, and B Corps, are called on to take action in accordance with their obligations to their stakeholders, the details of the moratorium are not intended to be a judgment about a company and their actions in the absence of the standards that will be developed in the future. Without such established standards however, it is not yet possible to comprehensively evaluate a company and determine whether they are qualified to be a Certified B Corporation under current circumstances.
Companies who have been and are interested in pursuing B Corp Certification and who have had operations in Russia and/or Belarus have been required to submit information to B Lab to determine whether their actions fall within the scope of the moratorium. For further information, read B Lab’s initial announcement of the moratorium from March 2022.