Family Businesses and the B Corp Movement
It has long been the case that family business owners derive real value in being able to talk to peers about the challenges and opportunities they are each dealing with at any point in time. Frequently those challenges relate to logistics or resources or competition from larger firms, as well as how the business and family interact through governance structures (or the absence of them). Among the opportunities is the ability to reflect core personal values in how the family business operates, which was the topic of a very interesting gathering recently.
As a member of the Society for Trust and Estate Professionals (STEP), I get the opportunity to regularly interact with a wide range of advisors who work with family businesses. Speaking to the assembled group on this occasion was James Perry, co-founder of COOK, which is a family-owned business providing high-quality ready-to-eat frozen meals. His perspective on family businesses as a means to positively impact society – in their case hiring people recovering from addiction or coming out of prison among their 850 staff – and still run a profitable company struck a chord with many who advise wealthy families that thinking more broadly about the “returns” being sought can prove to be extremely rewarding.
James Perry is also the co-chair and co-founder of B Lab in the UK, helping to lead the UK B Corp movement. While not everyone is familiar with the term “B Corp” yet, the concept is very straightforward and helps identify firms that authentically seek to do more than just maximise profits from those simply seeking to look “green” and be perceived as good corporate citizens. Firms that have become certified as B Corporations have demonstrated how they create value for non-shareholding stakeholders, such as their employees, the local community, and the environment. The non-profit organisation B Lab engages firms in a rigorous certification process to ensure and demonstrate that this is true. The first B Corporations were certified in the US in 2007 and the global B Corporation movement launched in the UK in 2015.
The overarching message was that the evolution of business is towards an increasing realisation that there are multiple relevant stakeholders that are affected by how businesses conduct themselves, and should therefore be explicitly considered in determining how businesses operate. While the owners are obviously interested in the profitability of a firm, how that business functions matters to the staff, to its clients, and to the broader community in which it is based or operates. Classic economists understood that business wasn’t just about the coming together of capital and labour, but had important and material effects on society as a whole.
MASECO is not only proud to be a B Corp, but one of the founding firms in the UK B Corp movement and the first wealth management firm in the UK to be certified. While in many ways this is simply a reflection of attitudes and behaviours which existed here anyway, the certification process and interaction with other B Corps highlights additional ways that we can continue to evolve and improve our ability to increase our “triple bottom line”…having a positive impact on the environment and the world around us, consider the social needs of people involved in and served by the company, and being a profitable and sustainable business.