Benefit Societies and B Corporations: Commonalities and Differences

Many companies are reflecting on the meaning of what they do, what we call 'purpose'. It is crucial to understand the ultimate reason why a company was created and what role it plays in society. This is an important starting point for embarking on a path towards sustainability. It is important to distinguish the purpose from the mission and vision of the organisation. The mission describes the activities and short- and medium-term goals of the company. The vision, on the other hand, defines what the organisation wishes to become in the future, e.g. its contribution to the development of the industry. Purpose, finally, concerns the ambition to create value and contribute to the well-being of society. It is the reason why the company was founded, its 'why' and its purpose. The purpose acts as a compass, guiding the company's decisions, enabling it to distinguish itself from other players in the market and to reach the hearts of customers.

Benefit societies are a specific form of legal structure that has been introduced in some countries. The first state to introduce legislation on benefit societies was Maryland in 2010. Since then, the concept of Benefit Societies has spread to other countries, such as the United Kingdom, Italy, Colombia and Australia. Italy introduced the legal form of 'Benefit Societies' with the llaw no. 208 of 28 December 2015, which came into force on 1 January 2016. Also known as the 'Benefit Company Act', this legal form requires companies to include one or more common benefit objectives in their articles of association (either in the memorandum of association or by amending an existing one). The common benefit objectives must be specific, measurable and achievable. In addition, Benefit Societies are required to monitor and evaluate effectiveness by providing an annual report documenting results and progress towards achieving the set objectives.

Born in the United States in 2006, B Corporations (Benefit Corporations) are companies that are committed to pursuing positive social and environmental goals in addition to financial profit. The B Corp movement was founded by B Lab, a non-profit organisation. Companies wishing to obtain B Corp certification must pass a detailed assessment that examines several areas of their operations, such as governance, employees, community impact and the environment. Once certified, B Corporations must undergo a periodic audit to maintain high performance standards. In Italy, the B Corp movement took shape in 2013 thanks to the interest of a group of entrepreneurs, professionals and activists. In 2015, an official B Lab Italia was established, with the aim of promoting and supporting B Corp in the country. Currently, the B Corp movement in Italy is growing, with over 200 certified companies in 2021.

The main difference between Benefit Company and B Corp lies in the fact that the Benefit Company is a legal form whereas the B Corp is a certification issued by a third party (in this case the B Lab). In Italy, in order to become a B Corp it is necessary to also be a Benefit Company and therefore one must first align oneself at the legal level. These two models arise from the fusion between the concept of profit and non-profit. Until a few years ago, in fact, organisations were distinguished into these two very different macro-worlds: the profit companies, whose sole purpose was to achieve profit, and the no-profit companies, which instead pursue one or more environmental/social goods but have no interest in profit. In essence, Benefit Societies are born from the desire to combine the best of both worlds, combining profit generation with a strong commitment to the common good, creating a business model that aims to balance financial sustainability and positive social impact.

What does it mean for a company to make sustainability a cornerstone of its business model? What are the models of organisations that seek to balance social or environmental goals with the pursuit of profit? To answer these questions and more, we have launched the project Pillole dall'Oasi: la Digital Academy by 3Bee for Sustainability Professionals, realised in collaboration with Neutralia and Italian Tech Academy. A course composed of 12 modules dedicated to training on topics related to business sustainability, with the involvement of 23 experts from the world of research, innovation, business and finance. An opportunity not only for training, but to join an exclusive community to receive monthly updates on news from the world of sustainability. Do you want to make your commitment to protecting the environment tangible and ensure the best training for your employees?