Benefit Corp vs. Certified B Corporation: What is the Difference?

Do Benefit corporations, B corps or Certified B Corporations mean the same thing? Benefit corporations and Certified B Corporations are often, and understandably, confused.  Both are sometimes called B Corps by mistake or as shorthand.  They share a mission statement but  have a few important differences.<


Certified B Corporation is a certification conferred by the nonprofit B Lab.  Certified B Corporations have been certified as having met a high standard of overall social and environmental performance.

Benefit corporation is a legal status administered by the state.  Benefit corporations do NOT need to be certified. Only seven states have the Benefit Corporation as an option when incorporation in that state: Hawaii, VIrginia, Maryland, Vermont, New Jersey, California and New York. Four more states are in the process of making it part of their states corporate legal system.

What is common between benefit corporations and Certified B Corporations?

  • Accountability: Directors of both are required to consider the effect of decisions not only on shareholders, but also on other stakeholders, such as workers, community, and the environment.
  • Transparency: Both are required to publish publically a report  assessing their overall social and environmental performance against a third party standard.
  •  B Lab, creator of the B Corp certification also advocates for such benefit corporation legislation!

What are the differences between benefit corporations and Certified B Corporations?

  • Performance: Each Certified B Corporation has achieved a verified minimum score on the B Impact Assessment (80/200).  While benefit corporations are required to publish an annual report assessing their overall social and environmental performance against a third party standard, that report is not required to be verified, certified, or audited by a third party standard organization.
  • Support: Certified B Corporations have access to a portfolio of services and support from B Lab to help them with marketing,  sales, raising money, saving money, learning from and doing business within the community of Certified B Corps.
  • Availability:  Benefit corporation is a corporate status legally recognized by 7 states as of now.  Certified B Corporation is a certification available to businesses in all 50 states and around the world.  Today, there are 517 Certified B Corps from more than 60 industries.

So what do you all think? Does this cause confusion? The best way to think about this is that a benefit corporation is a simpler version of the Certified B Corporation.

About the Author

Hi there! I am Priti and I specialize in strategy and communications for impact organizations that aim to create social, environmental and economic wealth for all stakeholders. Working from the ground up, I help these do-gooders craft effective programs for community engagement, outreach and profitability. Follow my work covering do-gooders, cleanweb, start-ups and Web 2.0 businesses on Ecopreneurist and at Crowdsourcing Week. I enjoy traveling with my boys, cooking up a gourmet meal from scratch and entertaining! Join my community for Social Entrepreneurs on G+ Follow me on Twitter, on LinkedIn and Google+