Corporate social responsibility: The new business as usual
Corporate social responsibility (CSR) is a company’s voluntary initiative to integrate responsibility for its environmental and societal impact into its business model.
Several key trends are driving CSR into mainstream business practices, among them:
- Increased globalization of markets, labor, and supply chains
- Increased pressure for transparency from investors and consumers
- The need to reduce costs and improve sustainability
- More competitive recruitment and retention of top talent
Business leaders and consumers alike are recognizing that Corporate Social Responsibility provides clear benefits to the business, its employees, consumers, communities, and investors.
Corporate Social Responsibility strategies tend to be concentrated in three domains: environmental impact, philanthropic giving, and ethical labor practices. Each company’s CSR program is unique to its mission, goals, challenges, and customers. With such diversity in CSR, some in the business community recognized the need for standards and formal accountability and reporting, as well as legal protections for business leaders who are committed to the “Triple-Bottom-Line — People, Planet and Profit.” A leading nonprofit organization, B Lab, was instrumental in driving legislation across the U.S. to create the benefit corporation, a new statutory corporate entity that provides just such accountability and protections. Learn more in CT’s article, Understanding Benefit Corporations.
Benefit corporations: Entities structured for profit and for good
The benefit corporation is becoming the statutory entity type of choice for corporations that provide clear and measurable public benefits in addition to making profits. If you’re considering forming a benefit corporation, see CT’s full roster of services.
States are adopting benefit corporation legislation at a pace even faster than that of the LLC. As of Q3-2014, 27 states including D.C. had passed legislation, with 19 more states pending. A new milestone was reached when the State of Delaware enabled benefit corporations in August 2013. Home to 64% of the Fortune 500, Delaware’s move will certainly accelerate public benefit corporation formations.
Businesses of all sizes may consider converting to benefit corporations or creating new spin-off benefit entities, and many attorneys are now specializing in benefit corporations. If you are evaluating whether to become a benefit corporation, or your represent a client who is, read CT’s article, Understanding Benefit Corporations.
Benefit corporations and certified B corporations – what’s the difference?
“Benefit Corporations” and “Certified B Corporations” are often confused. A Benefit corporation is a legal status administered by the state. A Certified B Corporation is a certification conferred by the nonprofit B Lab. Read our article to learn more about the important differences between the two. Visit B Lab to learn more about their certification, and to access their free impact assessment tool.
When you’re ready to incorporate as a benefit corporation, see CT’s full roster of services.