Another seal of approval for social responsibility? Bah humbug

Are we going to see a competition in triple-bottom-line certification?

I’ve written a lot about the non-profit B Lab and its B Corp. rating process for triple-bottom-line companies.  Businesses fill out a lengthy application with questions about practices in five key areas–environment, workforce, community and so forth–and then are certified as official “B Corp” organizations. The certification shows investors and consumers that the company is a legit social enterprise, first of all. And, by going through the process, businesses pinpoint areas for improvement. B Corp companies also have to include in their bylaws that they’ll take into account the interests of other stakeholders other than just shareholders when making decisions.

Now, a new for-profit company, Iconoclasts, has introduced what it calls the Good Company Seal. Founder Jeffrey McKinney, a former ad executive, says companies interested in proving their socially responsible bona fides will fill out an application that also focuses on five key areas and is assessed by a panel of eight to ten judges.  Those who make the grade will be able to use the seal. It’s specifically aimed at consumers, to help them figure out whether they’re really buying something from a true social enterprise or a greenwasher. And, McKinney says it also could entice companies to raise their corporate social responsibility practices up a notch. Also, they won’t have to agree to change their bylaws.

According to McKinney, there’s room for B Corp. and his thing, because the Good Company seal specifically targets consumers.

That may be true, but what’s the point? While I applaud McKinney’s intentions, for my money, the B Corp rating system is quite useful and effective. Now, it’s tied to a new, global system for institutional investors.  Why on earth do we need two systems?

Plus, there’s something else: Iconoclast’s for-profit status.  This may be one of those times when a non-profit is the way to go. I’ve written before that the mission’s the thing.  The decision to become for-profit or non-profit hinges on the most effective way to address your mission. In this case, I think non-profit is the route. McKinney says  he considered it, but felt the path was too complicated and wouldn’t sustain the organization. So, he plans to make money by charging licensing fees.

But, other successful certification systems, from LEED to Fair Trade, have been controlled by an independent non-profit.  Otherwise, it’s tough to create trust in the organization.

What I’d love to see is for these two organizations to work together in some way.  Perhaps there’s room for a mini-B Corp–a certification that doesn’t require the bylaw change.  But, two possibly competing systems? It’s a waste of valuable energy, time and money.