| dc.description.abstract | The urgency of the climate crisis and global inequality demands the action of all, including the private sector. While smaller, mission driven companies have initially led the corporate sustainability transition, moving towards a more sustainable economic system and remaining within planetary boundaries requires the participation of large companies as well. Increasing pressure from sustainability-oriented competitors and societal expectations are driving more companies to participate in a voluntary transition to more sustainable business models. This research uses the case study of the B Corporation (“B Corp”) certification facilitated by the nonprofit B Lab to investigate the transition that large European companies must undergo in order to successfully become a certified B Corp, including the driving motivations and the core challenges that they experience in the process. The results will contribute to literature on large enterprise pursuit of corporate sustainability and transitions to a sustainable hybrid business model.
The results of this research find that large companies are motivated from both external sources, including a desire for external recognition and verification and an increased competitive advantage; and internal sources, including an ambition for an internal transformation, interest from senior leadership, or to join a supportive community of businesses working on impact; but tend to evolve over time from an initial interest in external brand recognition and a collective, systems change ambition. In this transformation, large companies undergo several stages of transition, beginning with an Initial B Corp Certification which includes internal mobilization, resource allocation, documentation policies, engaging the entire company, and stakeholder governance changes. Then, companies embark on a long-term Impact Improvement Journey where they improve internal operations, connect impact to their long-term strategy, adopt a continuous improvement mindset, and celebrate successes. Finally, companies engage their value chain and join collective action initiatives Systems Change Ambassador in a mature B Corp phase. In the process, large companies experience challenges related to B Lab timelines, pricing and standards; internal challenges including a culture shift, prioritization, data management, and governance changes; and external challenges due to lack of awareness and supply chain complexities.
Understanding how large companies can transition from conventional business models towards a sustainable hybrid business model, with the example of B Corp certification, highlights the areas of investment that are necessary to make impactful changes in corporate behavior related to social and environmental impacts and ultimately address the Sustainable Development Goals. | |
