The Number of B Corps in the U.S. Keeps Climbing. Here's Why

Certifications for factors such as environmental sustainability are increasingly important to consumers, more than half of whom say these types of designations help them make shopping or employment decisions. That could explain why so many companies are increasingly turning to organizations like B Lab and its B Corporation certification for validation.

In 2023, 2,385 companies across the U.S. and Canada achieved B Corp certification — a jump of about 16 percent from the 2,057 certified B Corporations in the previous year. And a record 328 new companies joined the ranks in 2023, according to B Lab's 2023 Annual Report.

Globally, the number of certified B Corporations has climbed more than 30 percent year-over-year for the past two years, totaling 8,051 in 2023.

B Corp certification indicates that a company has met certain standards of social and environmental performance, transparency, and accountability — and that these claims have been evaluated by B Lab, the global nonprofit behind the certification. In its 2023 report, B Lab found some 56 percent of consumers surveyed either "agreed" or "strongly agreed" that certifications for factors like environmental and social business practices assisted them with decision-making when considering which businesses to buy from, or even which to work for.

A separate survey of 2,000 Gen-Z and Millennial shoppers from Tom's of Maine, a certified B Corporation, and OnePoll found that 80 percent of that cohort base buying decisions on a company's mission and 74 percent are willing to boycott for ethical reasons, according to the New York Post.

While it can be increasingly difficult to parse reality from smooth marketing, Wren Montgomery, associate professor of management and sustainability at Ivey Business School and co-founder of the anti-greenwashing research organization Greenwash Action Lab, says certification programs can help companies cut through the noise and reach consumers.

"A known certification allows consumers to trust that a third party — someone with much more time and knowledge than we have while standing in a retail aisle! — has investigated and confirmed that the company meets their standards," Montgomery wrote in an email. She also cautions consumers to be wary of "very loose or even fake" certifications that have emerged in recent years as companies get wise to consumers' taste for transparency.

B Lab was founded in 2006 and certified its first 82 companies in 2007. Although the program has grown steadily ever since, the past few years have seen a surge in certified B Corps — a trend B Lab's head of external affairs and interim co-lead executive, Sarah Schwimmer, says unexpectedly accelerated in 2020. Schwimmer attributes some of the growth to "converging crises" in the world such as the climate crisis.

With that, there is "increasing awareness and recognition of the role that the private sector does play," she adds. "We have an impact and we have an opportunity to tell the story and to step into, in some cases, a void of leadership."

Plus the program comes with clear benefits. Certified B Corps are able to proudly display the logo on their websites and products, and gain access to a community of global companies and the expertise they possess. The program does have annual fees that range from $2,000 to $50,000, based on revenue, and companies can incur costs when attempting to get compliant. Despite this, B Lab says certified companies typically see neutral or positive financial impacts, and over time tend to outperform in terms of revenue growth.

"Companies that have a strong sense of purpose and really consider their workers as important stakeholders in their success tend to have a more engaged and effective workforce," Schwimmer says.

Des Moines-based coffee company BLK & Bold (2023 Inc. 5000, No. 61) offers just such a success story. The premium coffee company, founded by Pernell Cezar and Rod Johnson in 2018, donates 5 percent of its revenue to organizations that help underserved children gain access to computers, healthy food, and career development, among other things.

The founders tried for B Corp certification in 2019 and ultimately achieved it in 2020. When the company was recertified in 2023, its score on the B Impact Assessment, the rubric used to determine whether a company qualifies, improved by about 20 points.

"They absolutely lift up the hood and examine all aspects of the business, from your suppliers to the health care packages that you offer, to the demographic of your employees, staff," says Rod Johnson, BLK & Bold co-founder and chief values officer.

Johnson says that in addition to all the marketing perks, the company has access to a community with valuable knowledge that has helped the team improve the business, as well as opened doors for collaboration, like the company's partnership with fellow certified B Corp Ben & Jerry's on a cold brew, brownie, and marshmallow swirl ice cream called "Change Is Brewing."

"There is increased prioritization from consumers to shop their interest and to shop their passions," Johnson says, adding that the B Corps certification is "that differentiator between us and other brands [and] was what ultimately convinced many consumers to shop with us versus the many other options that they have in the coffee aisle."

As the ranks of the B Corp certified have swelled, the organization has taken heat that the quantity of certified organizations could undervalue its exclusivity. Other critics have called out B Lab for certifying brands like Sanpellegrino, owned by multinational giant Nestle.

Schwimmer says that every certified company has been through the exact same vetting process and B Lab "stand[s] behind the certification." She also says that tension between perceived exclusivity and the swelling ranks of certified companies is "understandable."

"Everything we do is rooted in our mission and our need to move toward impact. And for us, that means creating an inclusive community of B Corps that have met the standards, and therefore can be torchbearers for what good business looks like," she says.

Plus, the organization is in the midst of updating its evaluation standards with input from thousands of stakeholders in order to "raise the bar of what good business looks like." B Lab aims to finalize and publish its new standards this year.

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This article was written by Chloe Aiello from Inc. and was legally licensed through the DiveMarketplace by Industry Dive. Please direct all licensing questions to legal@industrydive.com.