Every March, the global B Corp Community join together to celebrate what it means to be a B Corp. It’s great timing, because coincidently March also marks the anniversary of our B Corp certification.
Over the coming weeks we’ll be going “Behind the B” to tell you all about what being a B Corp means to Octopus. I thought I’d start at the beginning with an overview of the movement for anyone who isn’t familiar with B Corp.’ Stay tuned on our LinkedIn channels for more updates over the next few weeks.
Going back to where it all began
If you ever want a case history in how to build a great company, the history of the Cadbury business is a good place to start. It was a Quaker family enterprise with a sense of community deeply ingrained through every bit of its DNA.
It led the way in terms of employee welfare. It paid high wages, introduced days off, provided vitamins and free healthcare as well as pensions and unemployment benefits. It even created ‘Cadbury villages’ where workers, their families and the local community all benefited from improved living conditions.
The notion that capitalism was a form of self-enrichment would have been deeply offensive to the Cadbury family. Wealth creation, in their eyes, was for the benefit of everyone – their workers, the community and broader society. They even rejected advertising as a form of ‘puffery’ – the quality of the product was all that mattered.
Cadbury’s form of capitalism proved extraordinarily successful. Adopting the same community-based business model, other Quaker families ended up running 74 banks and more than 200 other businesses in the UK, helping to shape the industrial revolution that was to come.
A turning tide
Sadly, however, something happened during the industrial revolution that changed how businesses gauged their success. Profit became everything. In fact, companies became so preoccupied with making money that they lost sight of helping others. As they scaled (and got further from their customers) their morality declined.
All of this explains why when you ask people which of the 200 million companies in the world they’d like to be friends with, the answer is almost always the same. Silence. Cadbury, by comparison, would have had friends aplenty.
And while I think businesses are starting to wake up to just how poorly they’ve behaved, I don’t think they’re actually doing very much about it. Too much puffery and not enough action, as Cadbury would say.
A few years ago, I was reading about a modern-day Cadbury. The active wear brand, Patagonia. Their approach to business has so many parallels to Cadbury, and they achieve this through a commitment to all their stakeholders and not just their shareholders. I learned that they’d gone one step further by enshrining this approach into their business by becoming a B Corp.
What is a B Corporation (B Corp)?
A B Corp, I learned, is the equivalent of a Fairtrade coffee stamp, but for companies. B Corps are profit-making companies certified to meet very high standards of social and environmental performance, accountability, and transparency. Long story short but our team was so taken by the B Corp movement that, in 2019, we started the process ourselves. It was a long journey but at the start of 2021 we got there. We certified as a B Corp with a score of 94.2 (the average score for a typical company is 52.5 and you need to achieve a score of 80 to meet the B Corp threshold).
While we were delighted to meet the necessary standards, there’s been plenty for us to improve. Last year we focused on ‘environment’, taking a big step forward when we signed up to the B Corp Climate Collective, targeting net zero by 2030.
This year, we’re building the B Corp framework into our approach to managing money. And once it’s up and running we’ll share it with the rest of the investment community to help investors understand whether, beneath all the puffery, their investments really are building a better future.
If I’ve got one message for any companies thinking about becoming a B Corp, it’s that there’s no longer a trade-off between ‘doing good’ and ‘making money’. Purpose-driven companies, which understand what it means to make the world a better place, will deliver enormous financial returns for their investors over the coming decades. The Cadbury brothers, and the team at Patagonia would all back me up.