BUSINESS NEWS FROM THE FOUR-COUNTY REGION SEPTEMBER 10, 2010 Benefit corporations aim to promote sustainability by Christina Williams Sustainable Business Oregon EDITOR A nonprofit organization in Pennsylvania is working to spread acceptance of a new type of business corporation that emphasizes triple-bottom-line principles and good corporate citizenship: the benefit corporation, or B corp. for short. But while the B corp.’s founding principles were influenced in part by some Oregon sustainable business pioneers — clothing company Nau Inc. and invest- Chen ment firm Upstream 21 — the certification hasn’t found a legal foothold inside Oregon. “Our slogan is that we’ve never had an original thought,” said Jay Coen Gilbert, one of the founders of B Lab, the nonprofit behind the B corp. movement. “These were two of the innovators we looked to for cutting-edge corporate governance work.” What B corp. strives to do is formalize the requirements a company should follow to become a certified benefit corporation. Blended in with the legal requirements for standard business incorporation — such as S corps., C corps. and LLCs — are other requirements such as high standards for fair employment practices, benefits to consumers and benefits to the environment. There are 327 companies that self-identify as B corps. nationwide, including 19 in Oregon. In order to spread the gospel of the benefit corporation even further, B Labs is working on the policy front on a state-by-state basis. This spring, both Maryland and Vermont passed legislation to legally recognize B corporations alongside other types of business organizations. Coen Gilbert said there’s no legislation in the works in Oregon to do something similar, but B Labs is working through other channels. This summer, the team met with staff from Portland Mayor Sam Adams’ office to discuss the possibility of setting up a tax incentive structure for certified B corps. The city could also implement a preference for B corps. into its procurement practices. “Folks have wanted to create a sustainable business procurement program, but the problem was always been: Who qualifies?” Coen Gilbert said. “The B corp. gives a credible third party to rely on.” Late last year, Philadelphia became the first city in the country to formally approve tax breaks for B corps. But the B corp. is not the only path to sustainable business. In 2007, Oregon Gov. Ted Kulongoski signed House Bill 2826 into law, officially allowing a company’s articles of incorporation to include a provision “authorizing or directing the corporation to conduct the business of the corporation in a manner that is environmentally and socially responsible.” “That moved the ball forward for Oregon,” said Jeff Wolfstone, a shareholder with law firm Lane Powell. “Oregon has a strong entrepreneurial spirit and has quite a focus on things sustainable. It’s an important place for things like B corps. to develop, whether they are actually labeled B corp. or not.” Regardless of whether Oregon joins other states and gets official with its B corp. recognition, at least one Oregon company has its eye on the process. Portland-based Equilibrium Capital, a registered B corp., has two slots on the B Labs advisory team. Kipp Baratoff, an Equilibrium partner, sits on the group’s financial services industry working group. Dave Chen, Equilibrium’s founder and managing director, serves on its board of directors Reprinted for web use with permission from the Portland Business Journal. ©2010, all rights reserved. Reprinted by Scoop ReprintSource 1-800-767-3263.