B Corp scepticism rises amid greenwashing row
The organisation behind the B Corporations certificate finds itself at a cross-roads, with smaller members demanding major corporations be held accountable for their environmental and social legacies.
Founded in 2006, B Lab is a non-profit organisation is an organisation looking to certify environmental, social and governance standards with corporate entities around the world. To do so, the group created the B Corporation award. The accreditation process was established in order to unite businesses as a ‘force for good’, and analyses a company’s impact in five main areas – workers, community, environment, customers and governance. The team engaged with suppliers and employees across the business to consider the impact their actions have on each of these areas.
Initial uptake from the consulting sector was slow. But increasingly, as the sector acknowledged that it was facing what Re-Set co-founder and B Corp ambassador James Bidwell described as “an existential crisis”, consultants sought to reinvent their public image – rather than resting on their laurels. While consulting firms have long taken a lead when it comes to their own carbon emissions, their high-profile work with industry’s biggest polluters – and ties to state actors who have dragged their feet on climate change – has become one of consulting’s fiercest areas of criticism.
In the last four years, this has seen a growing number of the advisory sector’s biggest names signing up to be evaluated by B Lab, in the hopes of becoming a B Corp. And many have succeeded; Kin + Carta, Bip and 4C Associates, OC&C Strategy Consultants, and Campbell Tickell among them. Each new certification has been heralded with a grand press release, celebrating high scores in environmental and employment practices, or social impact-oriented business models.
But at the same time as this marked rise in the number of consulting firms apparently proving their ESG-credentials, questions have also emerged as to what being a B Corp actually entails. Often referred to in marketing as a ‘movement’, B Lab has come under mounting scrutiny from its membership.
In 2022, allegations of B Lab’s double-standards went public – as a group of B Corp-certified coffee companies alongside Portland, Oregon-based non-profit Fair World Project, wrote an open letter to the organisation, in the wake of Nestlé-owned coffee company Nespresso receiving B Corp designation. The letter pointed to Nespresso's "abysmal track record on human rights" and "extractive business model", they asked for stricter standards across B Lab Global.
Later that same year, B Lab’s processes came under fire again, relating to then-B Corp Brewdog. An open letter from workers at the British brewery cited a "culture of fear" at the company, in which workers were bullied and "treated like objects" – even though Brewdog has achieved its highest scores in the worker-assessment areas during its B Corp evaluation. The fallout saw Brewdog lose its certification, but the damage to the B Lab brand had already been done.
On top of this, in 2023, a number of B Corp marketing agencies began called for B Lab to take a stance on Shell’s $200 million media review. Early in 2024, B Lab finally made headlines when it announced it would launch a formal investigation into the B Corp status of four Havas media agencies relatedly – following the company's controversial multi-million-dollar account with fossil-fuel giant Shell. At the same time, 26 other B Corp advertising firms from Clean Creatives, a collective of media companies cutting ties with fossil-fuel clients, have put pressure on the organisation to strip the subsidiary companies of accreditation.
Amid raging debates about greenwashing and greenhushing, the suggestion of marketing firms potentially helping a fossil-fuel giant to spin its environmental impacts into a positive, without taking meaningful action, has been met with indignation, and some critics suggest it undermines the entire point of B Corps, to help consumers spend conscientiously when they choose to. On top of that, a recent interview with the BBC, Matthew Cotton, professor of public policy at Teesside University, also cast doubt on the methods which B Lab uses to evaluate B Corps in the first place – including its reliance on self-reporting.
Greenwashing allegations
Speaking on the process, Cotton warned, "Academics and ethical consumer action organisations have argued that it makes it relatively easy to manipulate internal reporting procedures or misrepresent findings.”
At the same time, he noted that this model puts the choice of sustainable goals in the hands of businesses. Noting that companies could theoretically prioritise what is easier to implement versus what is better for the environment, he pointed to one example being “prioritising single-use plastic reduction to show their environmental credentials, at the expense of a more urgent need to decarbonise their supply chain". This is something which could mislead consumers in some cases, he noted, suggesting they might be “persuaded by the B Corp stamp of approval to buy products that wouldn't meet their personal ethical standards."
Cotton added, "This may mean that certain companies greenwash their businesses by receiving accolades for their social and environmental performance without actually providing strong benefits to society and the natural environment.”
It is a process which B Lab stands behind, though. B Lab UK executive director Chris Turner told the BBC that companies must re-certify every three years by completing the B Impact Assessment and verification process from scratch. Meanwhile, B Lab added that it takes steps to “verify the self-reported data through publicly available records”.
But whichever side consumers and businesses take on this debate, there are also some who are keen to point out that the discussion hinges on a series of mis-classifications. The idea that B Corps are part of a movement is what seems to be driving their push to police its organisational body – but they pay between £789 to £35,483 to be a B Corp in the first place. According to Jonathan Trimble, CEO of And Rising – a B Corp since 2016 – this means that each B Corp is free to pursue business in whatever way they see fit, “provided they don’t breach their own B Corporation standards” – adding that amid this self-governance, breached “would not be picked up until that company struggled with its score to re-certify (every three years)”.
At the same time, the pressure of smaller members to keep larger operators out might run counter-intuitive to wider B Corp goals. Trimble argued that “B Corporation is not a moral compass. It is a framework for operating a business with consideration for all stakeholders – employees, communities, the planet and shareholders alike”. Adding that the distinction was important as it “helps prevent the misconception that B Corps are infallibly virtuous”, he contended that if Shell itself met the requirements, “it can become a B Corporation, and that might be a positive step.”
Ultimately, this may highlight a contradiction at the heart of B Lab’s core goals. Placing the impetus for change on individual companies for issues which only systemic solutions will really do – such as climate change and widespread human rights violations – can distract from the inherent flaws in the economic and political status-quo that firms are incentivised to exploit. To that extent, nudging corporate players into creating a better world may be putting a band-aid on a far more severe set of issues, that require a very different kind of change.
“Business is business,” Trimble concluded. “Make decisions the best way you can about business. And if you feel the need for systemic change, then seek it beyond B Corps. It's incorrect to use B Corps just to highlight oneself as a positive force, as this undermines the genuine and effective method that B Corps represent for managing businesses. Prioritising appearance over real progress is not the intention behind B Corps. For those in professional services, that’s surely not the priority either.”
