Every benefit corporation is required to publish publically an annual benefit report that includes "an assessment of [its] overall social and environmental performance against a third party standard."
This transparency requirement is intended to help the benefit corporation, its directors, its shareholders, and the general public determine whether the benefit corporation has met its statutory corporate purpose to "create a material positive impact on society and the environment, taken as a whole, assessed against a third party standard."
A third party standard is defined as "a standard for defining, reporting, and assessing overall corporate social and environmental performance" that meets the criteria listed here.
- Government has no role in determining whether a selected third party standard is acceptable or whether the benefit corporation has met its benefit corporation purpose to create a material positive impact;
- Benefit corporation legislation does not require benefit corporations to adopt any particular third party standard in preparing its annual benefit report; and
- Benefit corporation legislation does not require the annual benefit report to be audited or certified by any third party standards organization.
Click here to view a listing of third party standards that assess companies' social and environmental performance. It is up to the benefit corporation, its directors, and ultimately its shareholders, to judge whether any particular third party standard fits the statutory definition. B Lab does not take any position on whether a given standard would be deemed acceptable.