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Legal insights & industry updates

| 3 minutes read

The B-Corp Movement is on a mission to transform the economy

B-Corps are companies which have met high standards of social and environmental performance, transparency and accountability. They are becoming increasingly prevalent in the business community and we have worked with them for a number of years. 

However, you never stop learning so to help our understanding I recently completed the ‘Behind the B: An introduction to the B-Corp Movement’ training delivered by B-Lab, the certified global entity which regulates B-Corps around the world. This article will cover some of my newly found knowledge.

What is a B-Corp?

A B-Corp (or Benefit Corporation) are companies that are verified by B-Lab to meet high standards of social and environmental performance, transparency and accountability. Essentially, the business has to show that they use business as a source of good. They have to be dedicated to transforming the global economy to benefit people, communities and the planet. B-Lab's vision is to create a global economy that uses business as a force for good. Each business must be purpose-driven. There are now more than 1,800 B-Corps in the UK, across 58 industries. Recognisable names include Huel Limited, Graze, Funkin Cocktails and Elemis Skincare.

How to achieve B-Corp status:

The process of becoming a B-Corp is rigorous and comprehensive, which can be very challenging and time-consuming to achieve. Step-by-step::

  • Step 1 – Get serious about the mission. The business will have to put in the effort to meet certain environmental performances.
  • Step 2 – Complete the B Impact Assessment. This is around 200 questions about the positive impact on workers, suppliers, communities and the environment. The certification requires a score of 80 or more.
  • Step 3 – Improve the B-Impact Assessment score. It’s very rare to achieve the required 80 points on the B-Impact Assessment the first time around, and often takes some improvement to continue to the next steps.
  • Step 4- Make the legal change. This is where Harper Macleod can help. Once the B-Impact assessment has been passed, there is a requirement to amend a business’ governing constitutional documents.More on this later.

The B-Impact Assessment (BIA): 

The B-Impact Assessment is the standard businesses need to meet. The assessment structure is tailored to the size, sector, and location of the business. These three factors will influence the types of questions found in each of the assessments, but the structure is similar for any version. The B-Impact Assessment is broken into five distinct impact areas, representing the company’s Governance: Workers, Community Environment and Customers:

  • The workers' area evaluates a business’ contributions to employee financial security, health and safety, wellness, career development and engagement and satisfaction.
  • The community area evaluates a business’ engagement with, and impact on, the communities in which it operates, hires from and sources from. Topics would include diversity, equity, economic impact and supply chain management.
  • The environment area evaluates the overall environmental management practices of a business as well as its impact on the air, climate, water, and biodiversity. This section would also recognise businesses with environmentally innovative production processes and those that sell products or services that have a positive environmental impact. 
  • The customers' area evaluates a business’ stewardship of its customers through the quality of its products and services, ethical marketing, data privacy and security and feedback channels. This section would also recognise products or services that are designed to address a particular social problem for or through its customers.

The scoring within the assessment is designed to allow comparability and to identify and track opportunities for improvements over time.

The legal aspects: 

What has to happen legally to allow certification? There are five steps which must be completed to make the legal change:

  • The Board of Directors must review the legal requirements and ensure they are aware of any changes.
  • The internal shareholders must be engaged. The Directors should circulate the legal requirements to them for review and feedback.
  • This is approved by the Directors through a Board Minute of a meeting that involves the shareholders, where they propose a shareholders resolution.
  • The Articles of Association are then amended by the passing of the shareholders. This needs at least a 75% shareholder majority in order to approve this. However, a company should take legal advice to ensure there is no other constitutional documentation such as a shareholders' agreement or investment agreement that needs to be considered.
  • Finally, all of the relevant documentation should be filed with Companies House. This would include a Form CC04 (which will notify the change of companies’ objects), the amended Articles of Association and the shareholder resolution.


The training was incredibly insightful, allowing me to gain a better understanding of the process of becoming a B-Corp. I gained such additional respect for those organisations that pursue it because of the time and effort that needs to be put in in order to achieve the status – time and effort that is incredibly well-spent. 

The B-Corp movement is on a mission to transform the economy for the better. As one of Scotland's leading advisers of B-Corps, we can assist you on the way, whether you are an already established B-Corp, or looking to become one. 



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