Better Business: How the B Corp Movement Is Remaking Capitalism
Christopher Marquis
Yale University Press (September 2020)

Why shareholder primacy is “the cancer that’s killing American competitiveness” and how to cure it

Briefly, founded by a nonprofit called B Lab, “the B Corp movement is focused on creating a new kind of company that has a triple bottom line — people, planet, and profits — baked into its DNA. At the enter of this work is a rigorous assessment whereby companies’ performance is judged not just on earnings but on contributions to society and the environment.”

Christopher Marquis duly acknowledges that “when it is properly regulated by governments, capitalism can also be a tremendous force for good. The technological innovations and economic development it has spurred have lifted hundreds of millions of people out of poverty. In this volume,  he explains how and why Jay Coen Gilbert, Bart Houlahan, Andrew Kassoy, and their associates have — since 2006 — embraced that challenge “while also protecting individuals and society from its negative aspects.”

In or near the central business district of most major cities, there is a farmer’s market at which (at least until COVID-19) several merchants offer slices of fresh fruit as samples of their wares. In that same spirit, I now offer a selection of brief excerpts from Chapters 1-5 that suggest the thrust and flavor of Marquis’ perspectives:

Co-founders Coen Gilbert, Houlahan, and Kassoy “came to the conclusion that three fundamental pieces of [B Lab’s] infrastructure Are required to develop capitalism into a force in the world: objective standards on what a ‘good business’ is, a legal framework that recognizes stakeholders, and a collective voice to spread those ideas throughout the world. Thus was the B Corp movement set in motion.” (Page 46)

According to Houlahan, “we kinda added up  all the business associations and put them into a bucket and [said], ‘How big is the bucket?’ We came in at minimum( of thirty thousand to forty thousand businesses that were self-declared triple bottom line [i.e. people, planet, and profits] companies. When you started to look at the size of that universe and then put it in the context of what type of awareness there is about that universe, there was a total disconnect and there seemed to be a need for a collective voice.” (63

“If the community of B Corps was meant to reflect the diversity of the country and eventually of the world, this would require a “:sustained, significant, and intentional effort since the pool of business leaders already in the responsible business movement were already overwhelmingly led by white males.” (82)

“To overthrow shareholder primacy, there needs to be a fundamental change in the legal foundation of corporations. Benefit corporation legislation is an important step in that direction…But moving forward, it’s crucial that benefit corporations are required to comply with the transparency requirements in the law. Without vigorous enforcement, there is a risk that the ideas behind the law will lose legitimacy and detract from the larger movement.” (106)

“As more and more multinationals and institutional investors come on board, the B Corp movement will move closer to its tipping point, when the dominant ideology of shareholder primacy is replaced with a more humane and sustainable form of capitalism” (127)

It remains to be seen what the nature and extent of impact COVID-19 will have on the B-Corp movement. Will that virus be the “event” to which Christopher Marquis refers in the Preface, one that “connects the dots and leads to greater awareness and a steeper growth trajectory?” I am unqualified to make that determination. However,  he has convinced me of the need for a new corporate form — the benefit corporation — one that “encodes social and environmental benefits into corporations’ DNA.”

The B-Corp movement must succeed or the human race probably cannot survive its self-inflicted wounds.