---
title: "What Is B Corp?"
term: "B Corp"
description: "A B Corp is a company certified by B Lab for meeting verified standards of social and environmental performance, accountability, and transparency. Certification is separate from legal benefit-corporation status but often paired with it."
source: https://venturecapitaltracker.com/glossary/b-corp
---

# What Is B Corp?

> A B Corp is a company certified by B Lab for meeting verified standards of social and environmental performance, accountability, and transparency. Certification is separate from legal benefit-corporation status but often paired with it.

A **B Corp** is a for-profit company certified by the nonprofit B Lab after completing the B Impact Assessment and meeting a minimum score, with legal commitment to consider stakeholders beyond shareholders.

## How it works

The company completes B Lab's questionnaire covering governance, workers, community, environment, and customers. Scores above the threshold lead to certification, annual fees, and recertification every three years. Many certified B Corps also amend corporate charters to become benefit corporations where state law allows, embedding purpose into fiduciary duties.

Certification does not replace normal venture financing mechanics — preferred stock, liquidation preferences, and standard board duties still apply unless charter language explicitly expands stakeholder obligations. Some impact funds prefer B Corp or benefit corp status; traditional funds may ask whether certification constrains future sale options or dividend policy.

Consumer brands use B Corp status in marketing; B2B startups may certify to meet procurement or ESG vendor requirements from enterprise customers. Recertification every three years forces operational proof, not one-time marketing copy.

## Why it matters

- **Founders:** Budget time for assessment and documentation. Align certification with authentic operations, not greenwashing that fails recertification.
- **Investors:** Diligence whether stakeholder provisions create conflicts in an exit where maximizing shareholder value is the default goal.
- **Operators:** HR, supply chain, and environmental policies need evidence trails for auditors during recertification.

## Common mistake

Assuming "B Corp" and "benefit corporation" are the same. Benefit corporation is a legal entity type; B Corp is a certification any corporate form can pursue if it qualifies.

## Related ideas

Benefit corporation, ESG, impact investing, and stakeholder governance.

**By:** [Venture Capital Tracker](https://venturecapitaltracker.com/editorial-policy)

**Editorial note:** AI tools assisted with research, structure, or drafting. Venture Capital Tracker retains human editorial responsibility for factual accuracy, relevance, and source quality before publication.

---
Source: https://venturecapitaltracker.com/glossary/b-corp