Impact Topic Summary for Foundation Requirements

Modified on Mon, 21 Jul at 11:11 AM

The Foundation Requirements lay the groundwork for what it means to be a Certified B Corp. As the first step in the certification journey, they ensure companies meet key eligibility and accountability criteria before diving into the Impact Topics. The Foundation Requirements include eligibility requirements, the B Corp legal requirement, and risk profile.

Why this Matters

The Foundation Requirements ensure B Corps do not undermine B Lab’s Theory of Change, implement a stakeholder governance model by adopting the legal requirement, and align their due diligence approach with their risk profile.

Eligibility

The Foundation Requirements establish the initial eligibility criteria for companies seeking B Corp Certification. Companies must meet specific conditions—for example, they must have been operating for at least 12 months, comply with relevant laws, and agree to transparency about their performance once certified. They must also operate in an industry aligned with B Lab’s Theory of Change.

FR 1 - The company meets the eligibility requirements for B Corp Certification
FR 1.1 - The company meets the entity qualifications to become a B Corp	All companies	Year 0
FR1.2 - The company is not significantly involved in industries that undermine the B Lab Theory of Change
FR 1.3 - The company complies with local and national laws and regulations
FR 1.4 - The company shares accurate and complete information with B Lab
FR 1.5 - The company is transparent about its performance against the B Lab Standard

Legal requirement

Entities applying for the B Corp Certification meet the legal requirement of modifying their governing documents and supporting the shared collective purpose of the B Corp community. This ensures that B Corps remain legally accountable to all of their stakeholders, and allows companies to protect their mission even after capital structure or leadership changes.

FR 2 - The company adopts the B Corp legal requirement and commits to supporting the B Corp community’s collective purpose
FR 2.1 - The company adopts the B Corp legal requirement in its corporate structure or governing documents	All companies	Year 0
FR 2.2 - The company signs the Declaration of Interdependence and commits to the shared collective purpose of the B Corp community

Risk profile

Companies adopt a due diligence approach on issues depending on their risk exposure. This ensures that companies identify, prevent, and mitigate any negative human rights or environmental impacts, while increasing public accountability.

FR 3 - The company creates a risk profile and meets any additional sub-requirements
FR 3.1 - The company creates a risk profile and meets any additional sub-requirements	All Small, Medium, Large, Extra Large, and Extra Extra Large companies	Year 0

Appendix

Key terms and definitions

Term	Definition
B Corp Legal requirement	A component of the B Corp Foundation Requirements, requiring companies to: • adopt a broad purpose to create a material positive impact on society or the environment • modify director's obligations in governing documents to enable stakeholder governance. The legal requirement includes a purpose and a director's clause.
B Lab’s Theory of Change	The idea underlying the mission of the B Global Network and movement — to create a world where business is a force for good, and companies lead efforts to transform the global economy into a more inclusive, equitable, and regenerative system.
Declaration of Interdependence	We envision a global economy that uses business as a force for good. This economy consists of a new type of corporation – the B Corporation – which is purpose-driven and creates benefits for all stakeholders, not just shareholders. As Certified B Corporations and leaders of this emerging economy, we believe: That we must be the change we seek in the world. That all business ought to be conducted as if people and place mattered.That, through their products, practices, and profits, businesses should aspire to do no harm and benefit all. To do so requires that we act with the understanding that we are each dependent upon another and thus responsible for each other and future generations. (B Lab)

Term

Definition

B Corp Legal requirement

A component of the B Corp Foundation Requirements, requiring companies to:

• adopt a broad purpose to create a material positive impact on society or the environment

• modify director's obligations in governing documents to enable stakeholder governance.

The legal requirement includes a purpose and a director's clause.

B Lab’s Theory of Change

The idea underlying the mission of the B Global Network and movement — to create a world where business is a force for good, and

companies lead efforts to transform the global economy into a more inclusive, equitable, and regenerative system.

Declaration of Interdependence

We envision a global economy that uses business as a force for good. This economy consists of a new type of corporation – the B Corporation – which is purpose-driven and creates benefits for all stakeholders, not just shareholders. As Certified B Corporations and leaders of this emerging economy, we believe: That we must be the change we seek in the world. That all business ought to be conducted as if people and place mattered.That, through their products, practices, and profits, businesses should aspire to do no harm and benefit all. To do so requires that we act with the understanding that we are each dependent upon another and thus responsible for each other and future generations. (B Lab)

Further resources

Topic	Resource
Sectors	North American Industry Classification System (NAICS) Codes [EN]
Legal	B Lab Legal Requirement Tool [EN] Consult the company’s local B Lab or Sistema B team [EN] to determine if there are legal structures available in the company’s jurisdiction