GIIRS is a wholly-owned subsidiary of B Lab.
B Lab Background and History
In 2006, Jay Coen Gilbert, Bart Houlahan, and Andrew Kassoy founded B Lab. B Lab is a nonprofit organization dedicated to using the power of business to solve social and environmental problems. B Lab achieves this objective through three interrelated initiatives: 1) building a community of Certified B Corporations; 2) accelerating the growth of impact investing through use of B Lab's GIIRS impact rating system; and 3) promoting supportive public policies. We envision a new sector of the economy comprised of B Corporations that are legally recognized by the states, tax preferred by the IRS, and valued by workers, investors, and consumers. As a result, individuals and communities will have greater economic opportunity, and society will have moved closer to achieving a positive environmental footprint.
There is a critical mass of entrepreneurs, investors, consumers, workers and policymakers seeking to create social and environmental impact through business. B Lab's work addresses two systemic problems impeding progress: 1) the absence of transparent standards makes it difficult for each of these stakeholders to support "good companies"; and 2) the legal concept of shareholder primacy makes it difficult for corporations to consider employee, community, and environmental interests when making decisions.
1. Certifying and Supporting B Corps
B Lab develops and promotes the standards used to certify B Corporations. Certified B Corporations: 1) meet rigorous standards of social and environmental performance by achieving a minimum score on the B Impact Ratings System; 2) legally expand their corporate responsibilities to include consideration of the interests of workers, community, and the environment; and 3) build collective voice through the power of the unifying B Corporation brand. As of August 2011, 450 companies in 36 U.S. states, Canada, and Germany have earned the designation of B Corporation (the "B" stands for "Benefit") by earning a minimum score of 80 on the B Impact Ratings Assessment. A marketplace is emerging around the standards used to certify B Corporations. More than 5,000 organizations are using the free web-based B Impact Rating System to assess and improve their social and environmental performance. The standards are being used as membership requirements by sustainable business associations, as listing requirements by emerging social stock exchanges, as eligibility requirements for access to private equity investment, preferred terms for commercial credit, and government tax breaks.
2. Accelerating the Growth of Impact Investing
B Lab is driving mission-aligned capital to entrepreneurs who use business to address the world's most challenging problems. B Lab's Global Impact Investing Rating System ("GIIRS") provide ratings and analytics for companies and funds seeking capital from impact investors and for investors to use to make intelligent impact investing decisions.
3. Developing Supportive Public Policy Innovations
B Lab has overseen the development of a model corporate code in partnership with national law firm Drinker Biddle & Reath. Unlike traditional corporations, Benefit Corporations must create a material positive impact on society and the environment; consider how decisions affect workers, community and the environment; and publicly report their social and environmental performance using established third party standards. In Spring 2010, Maryland and Vermont became the first states to sign Benefit Corporation legislation. Benefit Corporation has subsequently passed in California, Hawaii, Virginia, South Carolina, Illinois, Louisiana, and New Jersey. B Lab is working with three additional states to pass Benefit Corporation legislation in 2012
Government and the nonprofit sector are necessary but insufficient in addressing society's most challenging problems. Business represents 77% of U.S. GDP and is the most powerful force in our society. B Lab creates the standards, legal, public policy, capital markets, and branding infrastructure necessary to scale for-profit social innovation.