In recent years, consumers have begun to expect more from retailers in regard to environmental and social support. They are keeping track of green initiatives, actions taken to uplift the community and employees, and are making more of an effort to shop at stores that align with their beliefs. According to our recent proprietary survey of 1,920 consumers fielded in late May and early June of 2020, more than 2 in 5 American adults agree that finding a retailer whose values align with their own is critical to choosing where they shop. This has been especially evident lately as social media users have been calling to boycott companies. Many corporations are aware of heightened consumer demands and have thus started marketing their green practices and charitable donations. In a blog from early June, ACTION REQUIRED, we discussed several retailers’ responses or lack thereof to the Black Lives Matter Movement and consumers perceptions of them. Unfortunately, some companies do not practice what they preach or are participating in greenwashing, a practice in which companies use green marketing to deceive the customer. How then can a consumer trust that a company is actually environmentally and socially conscious? Luckily, there are a variety of certifications that validate these claims including the prominent Benefit Corporation (B Corp) Certification.
A Certified B Corp is a for profit company that has met the difficult standards of social and environmental performance, accountability, and transparency according to the nonprofit, B Lab. To become certified, the company must undergo a rigorous process in which they are evaluated on their impact on their workers, community, customers, and the environment. They must also provide documentation to support these claims and recertify every 3 years.
Our research indicates that people want to shop at stores that are socially and environmentally responsible, but have not yet connected those ideas to B Corps. In our survey, 64% agreed that brands have a responsibility to serve the local communities they operate in; when taking the B Impact Assessment, companies are evaluated on their contribution to the economic and social well-being of the communities they operate in by answering questions on diversity and inclusion, job creation, civic engagement and philanthropy, supply chain management, and more. Additionally, 62% of respondents agreed that retailers need to address the negative impact they have on the planet; Certified B Corps are evaluated on how they manage their environmental impact in areas such as climate, water use and sustainability, and impacts on land and life. Lastly, 74% agreed that retailers should ensure a positive and safe working environment for all qualified people regardless of age or disability, gender, race, religion, or sexual orientation; the B Impact Assessment evaluates companies based on how well they treat their employees, including their compensation practices, benefits, training, worker ownership and work environment. Despite the connections between stated consumer desires and Certified B Corps, only 54% of consumers indicated that attaining certification made a brand more appealing in their eyes. However, some cohorts demonstrated greater receptivity toward B corps certification, such as those who identify as women, those living on the West Coast, urban residents, and those with a college or advanced degree. And, strikingly, 64% of younger consumers ages 18-24 felt that B corps certification made a retail brand more appealing.
The disconnect between consumer shopping preferences and the appeal of Certified B Corps lies in the lack of awareness and understanding of them. Despite the fact that there are over 2,500 Certified B Corps in 50 countries, many consumers are not aware of their existence. When customers buy a pint of Ben & Jerry’s ice cream, for example, they may know they are supporting a socially responsible company with flavors that highlight important causes like Pecan Resist which celebrates activists who resist oppression, harmful environmental practices and injustice. However, they may not know they are buying from a Certified B Corp because the logo is not displayed on their products.
Other Certified B Corps attempt to more publicly market their status such as Athleta, a women’s athleisure company that uses window space to explain their Certified B Corp status, or New Seasons Market, a grocery store chain in the Pacific Northwest that was the first grocery store to certify and displays a large sign outside each store displaying their pride. Despite these notable attempts, many shoppers do not take the time to stop and read the windows or signs. Even if a customer does see a company is a Certified B Corp, many of those we surveyed reported that they found the concept confusing and did not see why they should trust the certification. It is important that consumers understand the validity of B Lab, the nonprofit that certifies businesses, which was founded in 2006 with the goal of enabling businesses to use their power to solve problems like wealth inequality, climate change, and social unrest. Lastly, customers may shy away from Certified B Corps in fear they are more expensive, which may be true depending on the product; but the markup ensures that employees are being paid well, the products are being sourced responsibly, and the community is being supported.
Along with B Corp Certifications, there are many other environmental and social certifications for companies and products including Fair Trade, Leaping Bunny, and EWG. Fair Trade is commonly used to certify coffee and chocolate products that are made according to rigorous social, environmental, and economic standards. The Leaping Bunny Certification, on the other hand, is used for cosmetics, personal care, household, and cleaning products and guarantees they are not tested on animals. Lastly, EWG Verified products are certified by toxicologists, chemists, and epidemiologists to not contain any ingredients that are harmful to people or the planet, to list all ingredients on the label, and to be safely manufactured. While all these certifications may overwhelm the consumer, B Corps are important to highlight as they certify the entire company as opposed to just a product.
Consumers are more interested than ever in supporting companies that align with their values on social and environmental issues with 59% saying it is best for retailers to take an active part in social, environmental, and political issues. However, they have a hard time figuring out which brands are genuine. By increasing the awareness of Certified B Corps, customers can feel confident in their support of businesses. Certified B Corps are a nascent trend and are picking up speed among the younger, urban, and highly educated population. We predict that the number of consumers interested in supporting businesses that align with their values will continue to grow in the coming years and the support of Certified B Corps will follow.