Social vs Sustainable vs For-Profit vs B-Corporation
Sometimes I’ve found it confusing to differentiate between social entreprises, sustainable businesses model, certified B-corporations and business as usual (plain for-profit companies). This is why I made this infographic. Just some comments:
- We shouldn’t confuse a sustainable business with a business that has developed a sustainability strategy. Granted, sustainable businesses usually have a sustainability strategy (which is their business strategy), but the other way round has proven not to be true (some unsustainable businesses have developed well known sustainability strategies). Implementing the Pathway for Sustainable Business, developed at BwCS (Business with Common Sense), would ensure that your business is on its way to become a sustainable business model, and that you can have a score to prove so.
- B-Corporations are companies that hold a B Corp certification (also known as B Lab certification or B Corporation certification), which is a private certification issued to for-profit companies by B Lab, a global non-profit organisation. To be granted and to preserve certification, companies must receive a minimum score on an online assessment for “social and environmental performance”, and integrate their commitments to stakeholders into company governing documents. (Source Wikipedia).
- The social business in this infographic follows Muhammad Yunus’ definition: they need to be economically self-sustainable (be a non-loss business), address a social challenge and also be a non-dividend company. Charities don’t fall into this description.
- The infographic does not contemplate charities, benefit corporations (a legal figure existing in part of the USA), other similar legal forms and cooperatives.
- The connecting lines are “must” lines, not “should” lines. That means: a social business must be a non-loss, non-dividend company, among other requirements. And it could also be a sustainable business.
Like I said once, a company that produces shoes in a sustainable way (sustainable business) is not the same as a company that produces shoes in order to address a social need (social business).
Please feel free to comment if you think information is wrong or missing. I’m always happy to correct and learn.