Appendix 1: About B Corporations

While there are many rating systems for social performance available, the B Survey seemed particularly well-suited for the CFEs studied here. Ideally, a third party evaluates a company’s practices, top to bottom, but in practice this kind of evaluation is very slow and exceedingly expensive (one well-known socially responsible company has spent over $1 million per year for this). For most CFEs, this level of expenditure is wildly unrealistic. Moreover, so few companies undertake such a comprehensive inventory, or do so with similar metrics, that it’s almost impossible to glean meaningful information about their relative performance. This is a classic instance of the perfect being the enemy of the good.

The B Survey, designed by a non-profit called B Lab, emphasizes the value of creating metrics that are quick, low-cost, and informative. The Survey is a web-based tool that is designed to be comprehensive yet user-friendly. Most businesses can complete it within 90-120 minutes. It is free and open to the public. With these features, all kinds of companies, large and small, can participate. In the first year of its existence over 3,500 businesses and consumers have registered to use the B Ratings System. Many companies use it to benchmark their performance and set internal goals, while other organizations are repurposing it to screen investments, customers, or suppliers. Several sustainable business networks also make the assessment a requirement for membership.

Participation in the B Survey process makes it possible to measure performance year after year and see progress, both relative to one’s self and relative to other companies generally, in your community, and in your market niche. A weakness, of course, is that the survey depends on self-reporting. But the survey works on an honor system, and any company found in breach will get enough bad publicity to discourage willful misrepresentation.

Performers that achieve B Corp certification are able to use it in their advertising. Already there are over 150 Certified B Corporations from over 30 industries, representing $1 billion in collective revenues and $6 billion in capital under management. To earn the certification, B Corporations not only have to meet the 80-point bar on the B Ratings System, but they also must undergo a variety of credibility and assurance tests. Each company must go through the Survey Review process with a B Lab staff member to make sure that all answers accurately reflect the intention of the question. It must submit documentation for approximately 20% of their survey answers. And one out of five companies must submit to auditing during a two-year period.

Version 1.0 of the B Survey was developed over the last three years and has been reviewed by 600+ entrepreneurs, investors, thought leaders, and academics, all of whom have had the opportunity to offer line-item critical feedback. It uses the best available open-source performance standards and impact metrics from numerous sources, including the Global Reporting Initiative, Wiser Business (a project of the Natural Capital Institute), and the Social Venture Network. The B Survey is governed by the Standards Advisory Council (SAC), an independent body of nine members, each with a deep industry or stakeholder expertise. Version 2.0 is now undergoing a year of public beta testing.

We found the 1.0 B Ratings System better suited to private corporations than to cooperatives and nonprofits (the 2.0 B Ratings System will fix this). B Lab also is overhauling its surveys to be much more specific to different industries, with food cutting across many of them.

For more information on the B Survey, check out the website of the organization behind the survey, B Lab, at www.bcorporation.net/.

Detailed Discussion of Enterprises that

Anna Marie Seafood: Did not pass B Survey

According to the B Ratings System established by B Lab, Anna Marie Seafood had strong scores for “leadership” (high marks in governance/accountability), “practices” (very strong scores in conducting business as if people matter, and strong scores in moving toward a positive environmental footprint and providing opportunities to those traditionally without), “employees” (work environment) and “community” (local economy benefits). Anna Marie Seafood ultimately did not qualify due to a general lack of formalized social and environmental policies and procedures, along with low scores in “practices” (low marks for not engaging in direct service, which offset higher scores mentioned above), “profits” (low marks for not distributing wealth through broad ownership and not supporting the community through charitable giving, which offset higher marks in compensating employees fairly), and “products” (low marks for not delivering a product that is inherently beneficial to society, which offset higher marks for using a beneficial method of production). Further, it is worth noting that the B Survey is not well-suited to measuring positive environmental impacts from a small fishing operation.

What’s the bottom line?
Though its products may not reach the neediest consumers and ownership of the enterprise is consolidated, we believe Anna Marie Seafood’s strong innovations in environmentally-sensitive fishing methods and gear (especially in an industry most often criticized for its environmental impacts), its pioneering and entrepreneurial use of onboard freezing, and achievements in direct marketing in an American market dominated by foreign farmed shrimp, make Anna Marie Seafood worthy of being considered a “community food enterprise.”


Indian Springs Farmers Association: Did not pass B Survey
According to the B Ratings System established by B Lab, Indian Springs Farmers Association had excellent scores in “practices” (high marks for providing opportunity to those traditionally without, conducting business as if people matter, and engaging in direct service) and “leadership”(high marks for governance/accountability and transparency/reporting), and “employees” (high marks for work environment). They also earned strong scores in “community” (diversity/broad ownership and local economy benefits). Ultimately, Indian Springs did not qualify due to a general lack of formalized social and environmental policies/procedures, and due to low scores in “products” (delivering a beneficial product or service, using beneficial methods of production), “profits” (okay marks in compensating employees fairly offset by low scores in supporting your community through charitable giving), and “consumers”(serving those in need). Further, it appears Indian Springs was harder on itself when judging the inherent societal benefits of its products than were some of our other enterprises when self-reporting.

What’s the bottom line?
Although Indian Springs Farmers Association is quite informal when it comes to book keeping and does not stipulate particular production or business practices to its members, its achievements in providing equitable and profitable economic opportunities for small farmers and farmers of color, and its long history of supporting other cooperatives and incubating innovations locally and in sister countries in the developing world, make it worthy of being considered a “community food enterprise.”


Cabbages & Condoms: Did not pass B Survey
According to the B Ratings System established by B Lab, Cabbages & Condoms had strong scores in “profits” (perfect scores for supporting community through charitable giving, and high marks for compensating employees fairly), and “leadership” (high marks for transparency/reporting and governance/accountability). But Cabbages & Condoms did not ultimately qualify due to low scores in “products” (delivering beneficial products or services), “practices” (okay scores in conducting business as if people matter and engaging in direct service offset by lower scores in serving those traditionally without), and “employees” (strong scores in compensating employees fairly and compensation and benefits offset by low marks for not distributing employee ownership).It’s worth noting the B Survey was not able to fully or effectively measure this business model, given that ownership was necessarily consolidated in order to direct all profits to the linked NGO.

What’s the bottom line?
Although the average Thai person may not frequent Cabbages & Condoms restaurants and resorts, they are certainly well-served as employees and as recipients of a wide range of public health, community, and environmental programs made possible through profits from these enterprises. Given the entrepreneurial innovations of this business model—finding a sustainable and replicable solution for the typical grant-reliant nonprofit—and the enterprise’s fundamental commitment to serving its communities, we believe Cabbages & Condoms is worthy of being considered a “community food enterprise.”


Sunstar Overseas Limited: Did not pass B Survey
According to the B Ratings System established by B Lab, Sunstar had excellent scores for “leadership” (high marks in governance, accountability, transparency, fair trade, and supplier code of conduct), and strong scores on “environment” (corporate office and manufacturing facilities) and “practices” (conducting business as if people matter, and moving toward positive environmental footprint). But Sunstar did not ultimately qualify due to low scores in “community” (lower scores in broad ownership and charity/direct service, which offset high scores in support to the local economy), “consumers” (low scores regarding providing a beneficial product and serving those most in need), and “profits” (higher marks for compensating employees fairly, but lower marks in charitable giving and for not distributing ownership).

What’s the bottom line?
In the case of Sunstar, though its products may not reach the neediest consumers and ownership of the enterprise is consolidated, we believe its achievements in fair-trade, the boost it provides to the local economy via significant local purchasing, its environmental advancements, progress toward a more balanced portfolio of export and domestic markets, and entrepreneurial creativity are noteworthy, and make Sunstar worthy of being considered a “community food enterprise.”