How do the new B Corp standards impact companies with clients in controversial industries? In this episode of Beyond the B, Ryan Honeyman dives into the November 18, 2024, updates released by B Lab. These updates introduce a framework to evaluate companies working with clients in sectors deemed controversial or ineligible. Ryan breaks down the implications for businesses aiming to align with the B Corp movement’s values.
Ryan explores the new classifications, pathways, and thresholds outlined in the standards. These include a nuanced approach to categorizing industries, the three levels of involvement (associated, linked, and contributing to adverse impacts), and how revenue thresholds influence B Corp eligibility. Throughout, he provides examples and discusses the challenges of applying these rules in practice.
Key Points From This Episode:
- The distinction between controversial and ineligible industries in the new standards.
- Explanation of the three levels of company involvement: associated, linked, and contributing to adverse impacts.
- Examples of controversial industries: recreational marijuana, nuclear power, and debt collection agencies.
- Examples of ineligible industries: fossil fuel production, gambling, and tobacco.
- Pathways to B Corp certification based on client industry and involvement level.
- The rationale for the 1% revenue threshold for clients in ineligible industries.
- How these updates align with international due diligence frameworks like the UN Guiding Principles on Business and Human Rights.
- Potential challenges and unanswered questions within the B Corp community about applying these standards.
- Feedback for B Lab on improving communication and phased rollouts of major updates.
Quotations:
- "We must think ahead: do we want to continue working with these industries in 5–10 years?" — Ryan Honeyman
- "Recreational marijuana’s inclusion as a controversial industry has sparked debate—is it any worse than alcohol or bottled water?" — Ryan Honeyman
- "The 1% revenue threshold provides some wiggle room but challenges companies to align with the movement’s values." — Ryan Honeyman
Links Mentioned in Today’s Episode:
- B Lab's New Guidance for Companies with Clients in Controversial Industries: https://www.bcorporation.net/en-us/standards/companies-with-clients-in-controversial-industries/
- Ryan Honeyman on LinkedIn: https://linkedin.com/in/ryanhoneyman
- Lift Economy: www.lifteconomy.com
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