Benefit Corporation Certification

You have done your research and you have decided to incorporate a Benefit Corporation or you have decided to convert your for-profit corporation into a Benefit Corporation. Congratulations. You may have also read or heard about becoming a certified b-corp. You may ask: Is this b-corp or Benefit Corporation Certification necessary and what will a certification do for your corporation?

Plain and simple, obtaining a b-corp certification is not part of the legal requirements in incorporating or becoming a Benefit Corporation. So, why obtain a b-corp certification?

A b-corp certification will allow you to market and advertise that your Benefit Corporation has gone over and above the bare legal minimum in becoming a beneficial corporation. This could provide your corporation with a competitive advantage when it comes to attracting and retaining employees and the ability to differentiate you from your competitors.

A benefit of the certification process is that a Benefit Corporation’s internal governance and decision making will be reviewed against an impact assessment. This assessment will provide a score and feedback as to the effectiveness of the implementation of a Benefit Corporation’s beneficial purpose. The Benefit Corporation will also receive information if additional measures should be taken in order to ensure that the Benefit Corporation’s non-shareholder stakeholders are receiving the maximum beneficial benefit from the corporation’s decision making and performance.

A b-corp certification is not necessary or appropriate for every Benefit Corporation but it would be a good practice for every Benefit Corporation to at least conduct due diligence in order to determine if a b-corp certification should be sought.

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Chris Corpus

Founding Partner at Corpus Law Inc

This article does not provide legal advice or create an attorney-client relationship. If you have any questions or would like to learn more about this topic or if you have other legal questions, do not hesitate to contact Chris Corpus, Esq. of Corpus Law Inc at 216-973-2475. Copyright Christopher A. Corpus 2016.