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What is a B-Corporation?

To B-Corp or Not to B-Corp?

October 31, 2018

What is a B-Corp?

A B-Corporation or Benefit-Corporation is a for-profit company that has baked social and environmental responsibility into the core of its business model - including legal documents - and it's usually recommended to be certified by B Lab. It basically puts making money on the same level as doing good by people and the planet in terms of resources, decision-making and priority. 

Is Diefendorff a B-Corp?

To date we have not gone through the process of being certified as a B-Corporation. The reasons for this are that I wanted to hold off on this process in part because, frankly, I had enough to do in starting the business and I'm just one guy (so far), after all. Also there are costs associated with certifying and, while they're not terribly prohibitive, each dollar matters in starting a business. 

So what are you doing then?

One of the key parts about being a certified B-Corporation is creating legal protections into a company's bylaws that says the company sees its purpose as being socially and environmentally responsible. Here is a direct, real screen shot of Diefendorff's bylaws that state so: 

The Purpose of a Corporation is to do more than make money

In addition, it was important to us to create the legal protections for our Board of Directors. This makes it possible for the Board to require executives of Diefendorff, Inc. to balance social, environmental and financial returns. Here, too, is a real deal screen shot from our bylaws:

Board of Directors that require social and environmental responsibility

Why is this important? All of this matters so that we can state clearly that we are company that does thing differently. But also so that we create the legal protections so that the "fiduciary duty" of our executives and Board of Directors includes social and environmental considerations. Lastly, in the event that we bring on an investor or several, these provisions are baked into the core of the legal founding of the company and are rather hard to reverse. 

Want to know more? 

There are more announcements to come, this is just the beginning.



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