Building Businesses That Matter

It's election season and that means we're once again hearing passionate cries about the virtues of American SMBs (small and medium-sized businesses). Candidates are right, of course, to focus their attention on a sector that's creating 64 percent of new jobs and paying 44 percent of the private payroll.

It's not just the financial contribution, however, that SMBs make to the economy that deserves attention. They are enormous forces for good in their communities. They are most often privately held and operated by people who are driven by something other than quarterly profit and shareholder value. At Free Range, we've been working with these organizations since 1999; we've seen time and again that building a business that matters, to their employees, to their communities and to the world, is what drives the majority of these business leaders. Perhaps this is why so many of the most innovative and effective examples of business as a force for good have come from SMBs, or at least companies that started that way. King Arthur Flour is a 200-year old employee-owned grain company, often recognized for its positive impacts. As is Oaklandish, an Oakland-based lifestyle brand focused on spreading "local love" in our East Bay community.

While these businesses may share a commitment to do good, they also share enormous challenges in maximizing the impact of that commitment. Small businesses have far less room for error and the effort necessary to scale their impact is exponentially higher. These leaders don't have the luxury of employing Corporate Social Responsibility teams to measure impact or ROI for their efforts. And unlike larger corporations with enormous advertising budgets, it can be hard for an innovative, small business to get noticed for their efforts.

Our organization spent years wrestling with these challenges. We were an agency with a mission to help do-good organizations tell their stories. Everything we created was with the intention to make the world better. But what we created was only half the battle. How we operated was equally, if not more, important. We knew to live our story out, we had to be at our best when it came to sustainability, employment policies and community engagement. Yet, we struggled with where to apportion our resources. Even worse, we had no benchmarks through which to measure progress and no way to expose our blindspots.

Back in 2008, B Corps helped transform us from intention to meaningful action. By going through B Corp's audits, we got immediate feedback on where our efforts were paying off and where we were floundering. We found, for instance, that while our benefits were top notch, our supplier policies were out of line with our values. And we got enough detail to know how to correct it. We got connected to other like-minded businesses on similar missions and learned how to push past blocks in ways that we could actually implement. And as we worked, year after year to improve our ratings, we had validated claims we could share with our clients and employees proving that we were in fact a business that mattered to the world.

As more social impact driven companies have joined, our community has amassed the best practices, case studies and failures to know what it actually means to be a business that creates positive social impact. The community has been willing to take strong positions on issues like climate change and worker's rights which means the B Corp definition of doing good has teeth rather than being a PR exercise. When a B Corp like Patagonia, RSF or Beneficial State Bank has come to us looking for help telling and evolving their social impact, we know right away that we're working with the raw materials of authenticity and commitment to community impact.

For more than a decade, I've heard small business owners speak proudly of their operations and their impact while lamenting that competitors or other large corporations don't seem to share their values. As B Corps, we're tackling this problem head on. By creating the Benefit Corporation, a new kind of legal entity, B Corp has been giving big businesses the license to operate like the best small businesses. Benefit Corporations can bake stakeholder interests into their charters, allowing them to operate for both social impact and profit.

From today until November 8, we'll hear more and more about businesses and their impact on America. The next day, the chatter will stop. But millions of businesses leaders will head to work continue to build businesses that matter. In our experience, the more that become B Corps, the more will succeed.

The B Corp Life is a new blog series geared towards exploring what it's like to work at a benefit corporation. Why do b corps matter, and what does the future hold for them? Let us know at or by tweeting with #TheBCorpLife.