Full time equivalency is the sum of the total amount of work conducted by your workforce as if it was all conducted by full time employees, which allows for a comparable and standardized way to understand the overall scope of a company’s operations. For companies who only employ full time workers, this is easy, as the sum of all workers is the sum of FTEs. It is when a company has workers that work part time, temporarily, and/or have qualifying independent contractors that calculations are more complicated.

Please note that the setup experience does this calculation for you. This article is only meant as a reference for this calculation, should you want to see and understand how this is determined, but this calculation is not required for proper sizing of your business. 

There are two ways to calculate FTE, either through an estimation methodology or via precise data on hours worked.  Given the complexity of calculating based on exact hours, it is generally recommended to calculate using the below estimation methodology:

*For independent contractors meeting the parameters above, they should be considered the equivalent of the closest other employment category.  For instance, if working the equivalent of full time, they should be considered 1 FTE and if only part time, 0.5.

To calculate the appropriate size track of your company: 

(1) Identify the number of employees in the last year, in each category, 

(2) Multiply by the appropriate FTE equivalent ratio, and 

(3) Sum them together for the total FTE 

For example, if a company has 100 Full Time Employees, 30 Part Time Employees, 100 Temporary Part Time Employees, and 20 independent contractors who work on a part time basis, but 20+ hours a week ongoing, their calculation would be as follows:

Alternatively, a company could calculate the exact number of hours worked by each employment category to arrive at an exact Full Time Equivalency if the above estimations do not seem appropriate and the relevant data is available.

For guidance on how to complete metrics and questions related to workers in the assessment itself, see here. 

It is common, and quite natural, for users to complete the BIA in a way that creates an inflated score.  Doing so, however, limits the value of the BIA as a management and improvement tool, and creates significant challenges and inefficiencies in the verification process should a company be pursuing B Corp Certification.  It is thus very important for a user to complete the assessment diligently and with an eye towards accuracy, honesty, and self-reflection. 

Remember, the scoring of the BIA is designed so that no company is penalized for their answers in the BIA, but instead earns points for each positive practice captured. Furthermore, high performance still may represent earning only ~40% of points available. 

As you go through the assessment, here are some tips that will help you conduct an accurate self-assessment and prepare for providing documentation during the B Corp Certification process:

• Pay close attention to the detail and scope of the questions to understand which answer options best apply to your company. For more information on the scope of questions in the B Impact Assessment, click here.

• Identify relevant teammates and data sources to help you complete specific questions or sections. Teams involved could include human resources, purchasing, etc. Documents could include handbooks and policies.   

• To help organize your data on key aspects of the BIA, use the template attached at the bottom.  Most companies pursuing B Corp Certification will be asked to complete this spreadsheet, and it will help to complete it to help you go through the assessment.  

• Make use of the resources for each question, including instructions and definitions, to ensure you have a clear understanding of the question and how to answer.

• When estimating your answers, answer conservatively. If a question is not relevant to your company, answer Not Applicable, Don’t Know or None of the Above.

• Answer only based on current and past performance, do not answer based on plans that your company has in the future.  

• Select answer options only when you have evidence to support your answer. If a question includes the word "written" or "formal" in the question itself OR in any of the answer options, it requires that your company has some form of written policy in order to earn credit. For more information on how to access the list of required documents, visit this page.

• Record notes and a rationale of why you selected an answer so that if asked about it, you will have the ability to recall quickly details about the answer. 

Particularly with regard to Impact Business Models, which are the most common part of the B Impact Assessment to inflate scores:

• Ensure that you are not completing multiple Impact Business Models for the same impact.  For example, if purchasing from Fair Trade suppliers, do not opt into both the Supply Chain Poverty Alleviation IBM in Community and the Economic Opportunity IBM in the Customers section).

• Limit the total number of Impact Business Models you opt into initially to one or two throughout the whole assessment.  Most companies have between 0-2 IBMs, but many companies incorrectly opt in to many more.  This will not only help you get a more accurate score, but will also be more efficient by reducing the total questions you’ll need to complete, and by removing potential confusion by seeing what might appear as repeat questions in each IBM.  To learn more about Impact Business Models, see here. 

In order to help users more clearly understand questions and  improve their impact performance, supplementary information is provided in the B Impact Assessment platform at the question level in order to guide users through the question, provide definitions, and link to external sources. To access this information for a specific question, click the “Learn” button below the question’s title. 

Once in this section, you will see one or more of the following:

• Explanations: This section provides definitions of terms used in the question or answer options, and/or specific instructions to help you answer the question more accurately. It may also include alignment with other third-party impact resources, like the UN Sustainable Development Goal targets.

• Examples: This section provides examples of businesses that are already practicing this topic, so that you can see what this question looks like in practice.    

• Implementations: This section provides a rationale for why the practice is deemed important to implement. This section may also provide links to best practice guides and implementation tools to help your staff put this topic into practice.

Users will also see an option to leave feedback on the questions themselves as well as explanations, definitions, and examples. This feedback is specifically about the standards content. Please share how we can improve the questions in future versions, share resources that you think would be valuable, or even your own best practices that we could include as examples. If you have a query about how to apply the question to your company, or about the purpose of the question, please submit a ticket to the Support Portal instead.

Key Highlights: 

• Identify the “current date” for which your current practices apply based on the date you started your assessment

• Then, identify what time period is relevant for questions referring to the “last twelve months” (reporting period)—looking from the “current date” back to that same date one year ago

• For “last fiscal year” questions, use the fiscal year that closed most recently from the “current date” and for which financial reports are available

• Make sure to submit the B Impact Assessment within 6 months of starting it to keep reported information current 

It’s important to identify an appropriate and consistent time period for your answers to the B Impact Assessment (BIA), as it provides a “snapshot” of a company’s social and environmental performance at a given point in time. Since the objective of the BIA is to capture a recent and accurate snapshot of your company’s performance, companies are highly encouraged to submit the assessment within 6 months of starting it. This is to ensure that the reported information is not outdated at the time at which it is reviewed for verification. 

This article discusses the  three types of time periods that should be used for different questions in the B Impact Assessment. 

Current/Present-Day 

Questions that do not mention a specific time period are meant to  assess the current policies and practices that are in place at a company. Answer these questions according to the policy or practice in place at your company at the time of completing the B Impact Assessment. If new policies or practices are adopted from the time the BIA is submitted to the time your company is in Verification, you may ask your Verification analyst to update your response to get a score improvement. 

Examples of questions answered using present-day time period

Reporting Period - Last 12 Months 

Many questions in the B Impact Assessment aim to assess the company’s performance over a period of time and specifically refer to the last 12 months. Any questions with references to “12 months ago” or “last 12 months” should be answered using the time period that began 12 months prior to the date you started the B Impact Assessment (also known as the “Reporting Period”).  For example, if you started the assessment on June 1, 2023, you should answer the question “Job Growth Rate” based on new jobs created between the reporting period of June 1, 2022 and June 1, 2023. 

Examples of questions answered using the Reporting Period

Last Fiscal Year 

Certain questions in the B Impact Assessment refer to the “last fiscal year” and should be answered according to the fiscal year that most recently concluded at the time of beginning the assessment, and for which financial data is available.  For example, if you are beginning the assessment on January 15, 2024, and your company’s fiscal year runs from February 1 to January 31, you may use data from the fiscal year that ended January 31, 2023. However, if financial statements for the fiscal year that ends on January 31, 2024 are finalized before you submit your assessment, you may choose to update your responses to questions referencing the last fiscal year. This is optional.

Examples of questions answered using the last fiscal year 

Recognizing that the B Impact Assessment is completed over a period of time, and that all of these time periods are designed to provide an appropriate measure of a company’s “current” performance, some flexibility is allowed for time periods to shift minimally as the company progresses through the BIA. However, after significant periods of time have lapsed (typically if the reported data is over 18 months old when the BIA is submitted), it is recommended (or in the case of B Corp Certification, required) that companies recalibrate their responses in the BIA to ensure their answers are consistent and appropriate measures of current performance.

Because the BIA offers companies a “snapshot” of their social and environmental performance, over time a company’s score may fluctuate slightly due to normal changes in operations, even if they have not made any substantive changes to their impact management approach. You can think of this similarly to a student who takes a test multiple times—you wouldn’t expect them to score exactly the same each time, even if their fundamental knowledge of the subject remains the same.

When going through the B Impact Assessment, you’ll encounter questions that may affect the content that appears later in the assessment or how a company scores in other assessment questions.  These questions are designed to  focus your attention on relevant practices and make the assessment completion process more efficient, and each question will have specific guidance describing how it works.

Gating Questions

These questions will enable or disable other questions or impact topics in the assessment based on a company’s response. They are designed to ensure that users see questions that are most applicable to them. 

You can identify gating questions by reading the guidance underneath the question text— all gating questions will state, “Your answers determine which future questions in the assessment are applicable to your company” (or something similar). You can also view all of the gating questions in your assessment by navigating to the Question Filter and selecting the “Gating” option under Question Type.

For example, a company might be asked this question about its supplier screening practices: 

If they respond “Yes” to this question, follow up questions will appear that ask about the specific social and environmental screening criteria and evaluation practices that are in place. If they respond “No,” the follow up questions will be disabled.

In addition to enabling and disabling specific follow up questions in the assessment, gating questions are also used to determine whether Impact Business Models are applicable to a particular company. These gating questions are found in the “Introduction” impact topics under Workers, Community, Environment, and Customers.

Calculated Questions

Calculated questions are most prevalent in the Impact Business Model sections of the assessment, which often combine attributes of a company’s business model with a measure of intensity (such as % of revenue from beneficial products) in order to calculate a score. Additionally, because there is an internal back-end calculation, the scores in this section will not be visible in the  downloaded Excel version of the BIA; for this reason among others it is recommended that companies work primarily within the BIA platform itself. The “Points Available” in these questions appears as 0.0, but they do affect a company’s score through the calculation. This will be specified in the guidance text that appears underneath the question:

B Lab’s Credible Certification Process

• Any third-party certification that is a full member of ISEAL automatically receives credit in the B Impact Assessment. 

• Our team looks for the following to determine if a certification is eligible to receive credit in the B Impact Assessment:

  • Governance: 

    • The structure of the organization is made transparent (Is information about the composition of the governing body, how it operates and makes decisions available on the website (e.g. funders, owners, governance system, members, its business model and funding sources)?

  • Standards:

    • The standards setting organization has a clearly defined, public-facing mission statement or vision statement that focuses on a specific social or environmental issue/area/practice of concern

    • The standard setting organization has a clear statement on the objective of the certification and the information it is claiming to verify

    • The organization has a mechanism in place to manage conflict of interest

    • Transparency: 

      • The standards (questions) are available to the public 

      • There is a minimum performance required to achieve certification (minimum score or separation of certified and non-certified entities) 

      • There is a clear explanation of the requirements to achieve certification (what is the minimum score, how does scoring work)

  • Verification:

    • The information in the assessment is verified for accuracy by the certifying organization or an approved third party

    • Comprehensive information about the verification requirements is publicly available (interviews, documentation, etc.)

Some examples of certifications that receive credit in the B Impact Assessment, for specific topics, are:

If your company has another product or practice that is certified by a different third party certification, we may be able to conduct research internally to determine if that certification can earn credit within the B Impact Assessment. Until that review is complete, we recommend answering any questions conservatively. 

Completing Worker Metrics

Completing Questions in the Workers Impact Area

A company’s overall job quality as offered to its workers is a core pillar of the B Impact Assessment’s approach to measuring social and environmental performance. A company’s offerings to its workers may vary substantially throughout its own workforce, however, for instance by providing varying benefits, competitive pay, and career development for full-time workers but not part-time workers, or for workers in specific locations. To provide a comprehensive measure of performance, worker questions in the BIA generally take an inclusive approach of a company’s overall workforce (including qualifying independent contractors), but individual questions specify particular scopes of the types of workers to include in both the questions themselves and question instructions.

Here is a set of overall guidance for answering questions in the Worker Section:  

Completing Worker Metrics

The Workers Introduction section begins with a set of Worker Metrics used to collect data on your workforce in the present and one year prior, and should be used by your company as overall framing for completing the rest of the assessment.  Answer each worker metric on a headcount basis for each relevant worker category.

Full-Time Workers

Full-time workers work year-round on an ongoing basis and typically work 35-50 hours per week. Different countries have different standards regarding what qualifies as full-time work; while 35+ hours can be used as general guidance, companies can use the relevant classification for their context when available (e.g., in the Netherlands a person working 32h/week is still considered a full-time worker, while in Japan a person working 38 hours a week is considered a part-time worker).

Part-Time Workers

Part-time workers work year-round on an ongoing basis and are on your company’s payroll but do not meet full-time equivalency standards (typically working less than 35 hours a week). 

Temporary/Seasonal Workers

Typically, temporary or seasonal workers are those who have a temporary employment contract, are directly on the payroll of your company, and who work for a short duration, such as 2-5 months in a year. Seasonal workers are common in agriculture and retail.

In a case when a company has temporary employees each year (e.g., a coffee bean plantation), capture the total number of temporary employees in the last 12 months, but do not count the same individual twice as they may have been hired for two different working periods during the same year. For example, a farming company may hire seasonal workers twice per year - when crops are planted and for harvesting crops.  If the same workers are hired to conduct both activities, they should each be counted once as temporary workers.

Independent Contractors

Individual independent contractors who work greater than 20 hours per week for your company over an indefinite period or longer than 6 months count toward your number of workers and should be considered in the scope of workers-related questions in the Workers Impact Area.
Individual independent contractors outside these conditions should be regarded as suppliers in the B Impact Assessment.

Salaried Workers
Salaried workers receive a fixed amount of pay for regular work that is not dependent upon the time worked. This is usually quantified on an annual or monthly basis.

Individual independent contractors who work greater than 20 hours per week for your company indefinitely or for longer than a 6-month period count toward your number of workers and should be considered in the scope of workers-related questions in the Workers Impact Area. If those individuals receive a fixed amount of pay for regular work that is not dependent upon the time worked those workers should also be included in the salaried worker count. 

Hourly Workers

Daily/hourly employees are those that are paid dependent upon the amount of time worked, and are either contracted on a daily basis or or paid for the amount of hours worked in a given time period. 

Working Owners

Working Owners are founders or partners who work at the company and have 10%+ ownership in the business. If a company’s workers consist only of founders or partners who own 10%+ of your company, then your company’s track size should be 0. This means there needs to be 1 FTE on payroll beyond the working owners/founders to move from the 0 to 1-9 track.

- If a Working Owner is payrolled and they have additional non-Working Owner staff, then the Working Owner should be included in the Worker metrics.

- If a Working Owner is NOT payrolled and they have additional non-Working Owner staff, then the Working Owner should not be included in Worker metrics.

Examples:

- Company A: Working Owner with 10% ownership but not on the payroll and no staff beyond Working Owner 

Result: 0 Worker track.

- Company B: Working Owner with 10% ownership AND is on the payroll but no staff beyond Working Owner.

Result: 0 Worker track.

- Company C: Working Owner with 10% ownership but not on the payroll and 1FTE additional staff beyond Working Owner.

Result: 1-9 track, Working Owner NOT including in Worker metrics since they are not payrolled.

- Company D: Working Owner with 10% ownership AND on payroll and 1FTE additional staff beyond Working Owner.

Result: 1-9 track, Working Owner ARE included in Worker metrics since payrolled.

*Note that the inclusion of qualifying independent contractors in the worker section is new to Version 6 of the B Impact Assessment.

Each of these worker categories (Full-time Workers, Part-time Workers, Temporary/Seasonal Workers, Independent Contractors, and Working Owners) will be considered in the questions in the rest of the Workers section, including only “working owners" included in Workers metrics (see the definition and examples for "working owners" above).

In the B Impact Assessment, interns are not considered workers, thus do not count them in the total number of workers or on workers-related questions (unless explicitly mentioned in the question). 

In the case of workers that are officially on a third-party/outsourcing agency payroll (e.g., employer of record or HR back-office that manages administrative functions like payroll and benefits), but are considered part of the company staff (i.e., the company does the recruiting, performance evaluations, career development, etc.), the workers should be count toward the total number of workers and be evaluated within the Workers Impact Area. If your company does not have control over the terms of employment, and employee management and development, the workers should not be included in the worker section. In this case, they are should be included as suppliers. Click here to learn more about outsourcing staffing services suppliers and how they are considered in the Community Impact Area. 

Completing Questions in the Workers Impact Area

The rest of the Workers Impact Area provides a roadmap and measurement of job quality for the workforce defined in the Impact Area Introduction, with different scopes and applications depending on the question. If not otherwise specified:

·       A question should be considered with all categories of its workforce in mind (full-time, part-time, temporary, qualifying independent contractors, and qualifying Working Owners), and 

·       An answer should only be selected if it applies to at least 80% of the specified workforce, on either an FTE basis or a headcount basis (unless another scope is specified in the question).

While a full-time equivalent calculation is recognized as the best way to comprehensively assess job quality across a company’s workforce, the BIA also recognizes that the complexity of such calculations presents limitations to efficient data collection, analysis, and verification. With that in mind, there are different approaches that a company can take to complete these questions, ranging from the most conservative estimation methodology (headcount), to an estimation of employment categories as full-time equivalents (FTE estimations), to precise data collection of hours worked to arrive at exact figures of full-time equivalency (exact data).  See here to learn how to apply the FTE estimation methodology.  Note that, while a headcount calculation is allowed in completing the BIA, it may present a conservative estimate of your performance and therefore limit a company’s score.  Identifying areas for a more precise calculation, therefore, is one opportunity to improve your company’s score.

If possible, it is also recommended that your company try to apply a consistent methodology (Full-time equivalency or employee headcount) across questions. If your methodologies vary by question, depending on the data available and where you would like to prioritize analysis, it is recommended that you use the Comments section under each question to document which methodology is used.

Many questions in the Workers Impact Area will include more specific application guidance regarding the type and scope of workers to consider:

·       Some questions may only consider certain types of workers based on their employment relationship and/or working hours. These designations might include full-time workers, part-time workers, full-time and part-time workers, salaried workers, hourly workers, temporary/seasonal workers, etc.  

·       Some questions may include instructions to select policies and practices that apply to “all workers” (100%), “a majority of workers” (>50%), or “any workers” (at least one), instead of the general 80% threshold.

Here are some examples of how these guidelines appear in different assessment questions:

Healthcare Plan - Your company's healthcare plan available to all full-time workers includes...

Benefits for Seasonal Worker - What benefits are offered to all seasonal-only workers on your farm?

Worker Flexibility Options - Does your company offer any of the following job flexibility options, whenever feasible, in writing and in practice for the majority of workers?

Paid Primary Caregiver Leave for Salary Workers - Which of the following describe the primary parental leave policies for salaried workers, either through your company or government programs?

If you have any questions as to how certain workers should be captured within the BIA, please submit a ticket to our B Lab Global Support team via our KB Portal detailing the nature of their employment (hours per week worked, months per year employed by contract) and an analyst will be able to assist you.

Because of the cross-cutting nature of managing a company’s supply chain impact, questions regarding suppliers are included in both the Community Impact Area and Environment Impact Area. The focus of general supply chain management is, however, centered in the Supply Chain Management goal in Community, recognizing that both suppliers themselves (and the impact a company has on them), and their workforces, are members of the broader global community in which a business operates and impacts. 

For the purposes of the B Impact Assessment (BIA), suppliers are vendors of products or services that account for your company’s expenses, including expenses within a company’s cost of goods sold. Suppliers' expenses (in the BIA) exclude pay-rolled salaries and bonuses, rent, and utility costs (water/energy/gas//internet/garbage collection, etc.). 

Costs from labor benefits (e.g. private health insurance supplier), however, should be included. Independent contractors that are not considered workers (do not work indefinitely or greater than 20 hours per week indefinitely or for greater than a 6 month period) should be included. Outsourced staffing service providers are also considered suppliers. 

While the notion of supply chain impact is often associated with companies who buy and sell physical products, all businesses, including service companies, have suppliers, and thus can have a positive impact on their supply chain through management practices. Service companies might have suppliers that include graphic designers, office supplies, public relations, or independent contractors/freelancers. While service companies are still asked about their suppliers in the BIA, however, these questions are less detailed for their circumstances and less heavily weighted in your company’s overall score to recognize that the impact is not as material as other sectors. 

Supplier Terms

Significant Suppliers are vendors of products or services who collectively represent approximately 80% of your company's purchases in currency terms (excluding salaries on payroll and bonuses, rent, utilities, and taxes). Significant Suppliers can include both suppliers of physical items and service providers like accountants and web designers. 

For Service companies with 0-9 FTE workers, Significant Suppliers can be considered as the 5 largest suppliers in currency terms. If your organization is a cooperative, members are not considered as suppliers. 

Local suppliers are owned and operated within the same community of your company or the relevant facilities in which it is used. While the size and distance of a community may vary by context, they should generally be based on a small-scale economically and culturally connected area like a metropolitan area, or in rural settings the county, as well as its surrounding vicinities (usually within 50 miles). This does not include a local branch of a company headquartered elsewhere.

Independent suppliers are privately owned (i.e. not publicly traded), are not a franchise of another company, and are not a wholly- or majority-owned subsidiary of another company.

Individual independent contractors may count as suppliers in the B Impact Assessment. Individual independent contractors who work greater than 20 hours per week for your company over an indefinite period or longer than 6 months count toward your number of workers and should be considered in the scope of workers-related questions in the Workers Impact Area.
Only Individual independent contractors outside these conditions should be regarded as suppliers in the B Impact Assessment.

Outsourced staffing services are functions that a company outsources to an external third party instead of using the company's own employees. Therefore, the workers are not directly employed by the company to which they provide their services. 

In some cases, it might not be straightforward to identify if a company should include certain suppliers as outsourced staffing service providers. Outsourced staffing services fill internal operational functions that a company could hire employees to perform instead of using a multi-party employment relationship. It refers exclusively to staff, therefore usually the service does not involve the provision or use of other physical assets from the supplier (e.g., using a contract manufacturer that owns its own facilities and equipment would not be considered an outsourced staffing service). Typically, workers employed by outsourced staffing providers are dedicated almost exclusively or mainly to the company to which they provide their services. 

Examples: 

• Customer support services outsourced to an external provider; 


• Temporary jobs filled by an agency (where the temporary workers are employed by the agency and not directly by the company); 


• Factory staff hired through a third-party staffing agency that works at your company's own manufacturing facilities; 


• Everyday cleaning and security services outsourced to an external provider;

In the case of workers that are officially on an outsourcing agency payroll (e.g., employer of record or HR back-office that manages administrative functions like payroll and benefits), but are considered part of the company staff (i.e., the company does the recruiting, performance evaluations, career development, etc.), the workers should be count toward the total number of workers and be evaluated within the Workers Impact Area. See Click Defining the Scope of and Completing the Workers Impact Area to learn more about how to define the scope of workers in your company for completing the B Impact Assessment.

Cost Terms

Cost of Goods Sold (COGS) typically appear on the financial statements of your company. The below definition provides an indication of which costs may be included in the calculation: 
Cost of Goods Sold (COGS) represents the direct costs attributable to the production of goods sold by a company. It includes various costs directly associated with the production or acquisition of the goods that a company sells during a specific period. These costs typically include:
- Direct materials 
- Direct costs of production
- Manufacturing overhead
- Direct labor (COGS does not include salaries and other general and administrative expenses; however, certain types of labor costs can be included in COGS, provided that they can be directly associated with specific sales. For example, a company that uses contractors to generate revenues might pay those contractors a commission based on the price charged to the customer. In that scenario, the commission earned by the contractors might be included in the company’s COGS, since that labor cost is directly connected to the revenues being generated.)
- Freight and shipping costs (but not the cost of shipping products to customers)
Source: Investopedia

Total cost of materials include spending on all physical raw materials, components and/or finished products and packaging, for products that the company sells. The transformation (e.g. manufacturing) and transportation costs are excluded.
The total costs of materials must include supplier expenses for all products that the company sells.
The financial concept that captures the inclusion of transformation (e.g. manufacturing) and transportation costs is Cost of Goods Sold (COGS).  

While the questions included in your B Impact Assessment are customized by your overarching  geographic markets—Developed Market United States, Developed Market Global, and Emerging Market—it is important to understand how to incorporate your local context into your answers to the BIA.

In some circumstances, questions have been designed to allow for flexibility in how a definition is applied in order to accommodate local context while maintaining overall standardization and comparability. For example:

• The definition of “full-time” employee  is not based on a specific number of hours per week in order to accommodate working hour norms that vary by country.

• The definition of “local” allows some flexibility in defining a “small-scale economically and culturally connected area” to accommodate varying geographic realities of what constitutes a local community.

• Questions that refer to “underrepresented populations”specifically instruct companies to consider the barriers to economic opportunities in their specific geographic context when determining what groups are considered underrepresented, recognizing that this will vary around the world.

Because of the assessment’s structure, it will also cover topics that frequently intersect with local laws and regulations, which could either prohibit or require policies or practices assessed in the BIA. For example:

• Questions about healthcare, caregiver leave, and other benefits available to your workers may be influenced by the government-sponsored benefits in your country.

• Questions about diversity in the workplace may not be feasible to answer if you operate in a country that prohibits tracking the demographics of your workforce.

• The status of benefit corporation legislation in your country or state influences the type of legal requirement available to company’s pursuing B Corp Certification.

Companies should answer questions, unless otherwise specified, about what is actually done, even if it is mandatory by law.

To learn more about the B Impact Assessment’s approach to universal standards and localization, see here.  

Though the B Impact Assessment is customized based on a company’s size and therefore has specific content for small and mid-sized businesses, the principles of the BIA still require a degree of formality and documentation that in many circumstances is challenging for small businesses and startups.  All companies should therefore answer questions based on the ability to provide formal evidence for any of their answers, both for the purposes of verifying their performance (for the purposes of B Corp Certification), as well as to recognize the important role that formalization provides in embedding best practices within a company.  Below are some points outlined to specifically guide small and medium sized companies through the B Impact Assessment:

• For small and medium sized businesses, we recommend that you begin by taking a first pass through the assessment and estimating some of your answers so that you can get an initial score. 

  • The first pass will help you understand what the data that must be collected, which people/teams should be engaged to collect this data, and to organize and gather the information itself. It will also help you identify areas for improvement and give a baseline score to benchmark against other companies that have used the BIA.

• During the first pass through the B Impact Assessment, we recommend that you be conservative in any estimated answers to avoid an inflated score, and then use the “Bookmark” function to flag questions you will need to return to in the future. You can use this function by clicking on the bookmark logo located on the upper right hand corner of the question.

• After gathering information, you should go through the assessment a second time and answer questions based on the evidence your company has available.

There may be questions that are not relevant to your business, or that you are not able to earn credit in. This is to be expected, as the B Impact Assessment is intentionally designed to include a wide variety of positive impact indicators. Even high performing companies will not earn points in every question.

Below are some additional tips for small and medium sized businesses on how small businesses can improve their score on the B Impact Assessment:

1. Formalizing Policies – As you go through the assessment you will notice that there are a substantial number of questions asking about formalized company policies. While your company may offer paid family leave, recycle, or prefer local suppliers on an ad hoc basis, the B Impact Assessment prioritizes positive practices that are codified in company documents—and thus more likely to be maintained over time. You can improve your B Impact Assessment score by engaging top level management to create organization-wide policies covering all employees or having team leaders document the standards and practices already existing in their departments. Creating a shared folder accessible to all employees or collecting them in a handbook ensures that all policies are at the reach of your employees, should they need them.

2. Tracking Impact Metrics – The assessment is trying to quantify impact in all five impact areas. It will be difficult for your company to gain points if you don’t track metrics like energy use, employee attrition, or waste production. One of the best ways to improve your score is to take a strategic approach towards tracking impact metrics and internal key performance indicators (KPIs), both giving you a clear image of your strengths and gaining you points on the B Impact Assessment.

3. Looking at your suppliers/vendors – An important component of the Community section of the assessment considers your supply chain and vendors. Vendors could include services such as graphic designers, office suppliers, or PR companies. If you aren’t already considering the impact of your company’s supply chain, consider implementing a simple supplier questionnaire, which will give you a snapshot of their policies and inputs. Then, you can take proactive action by creating a formalized purchasing policy outlining minimum requirements for vendors and suppliers.

4. Adopting a mission-aligned governance structure – Meeting the legal requirement of B Corp Certification in advance can get you anywhere between 5 points to 10 points. If none of the specified legal options are available to you, you can still earn 2.5 points by signing the B Corp Agreement. Learn more about how to meet the legal requirement on page 8.

Guidance for Startups

If your company has been in operations for more than 12 months but has not yet completed a full fiscal year, you may use data from the previous 12 months of operations to answer questions that specify “last fiscal year.”

If your company has not yet been in operations for at least 12 months, you can answer quantitative questions with the best estimate that you anticipate for your first 12 months of operations. Please note that companies with less than 12 months of operations are not eligible for B Corp Certification, but may be eligible for Pending B Corp status if they are located in a region that has a legal pathway. See this article to determine when your company’s operations started based on the scope of the B Impact Assessment.

If you have other questions about small businesses and the B Impact Assessment, contact your local B Lab partner or submit a ticket to our B Lab Global Support team via our KB Portal with any questions.  

In order to provide a comprehensive assessment of a company’s social and environmental performance, the B Impact Assessment considers all of a company’s operations even if it operates in multiple locations. In order to allow a business to get a comprehensive assessment of their performance, there are three approaches to completing the BIA that vary based on the structure and complexity of your business:

• In most cases, you should complete one assessment and answer questions based on all company operations across all locations.

• In cases where the company’s structure and operations are particularly complex with distinct business units, it may be appropriate to complete multiple B Impacts Assessments for discrete parts of your operations.

• If your company earns more than $100M USD in annual revenue and is interested in pursuing B Corp Certification, the first step of the process will be to contact B Lab to begin the Discovery process, as you are likely to have a more complex structure that requires a nuanced approach to impact management and verification with the BIA. This process will help determine the best certification approach for your company, including the number of assessments to complete and the appropriate way to structure them. More information is available on our website.

Using the B Impact Assessment across multiple locations can be challenging because specific practices vary by location for a variety of reasons. In order to make the process more efficient while maintaining the comprehensive approach of the BIA, questions include specific guidance  on the scope of a company’s operations that should be considered when answering, particularly in the Workers and Environment sections, as benefits and wages offered to employees, as well as the exact characteristics of facilities, are likely to vary by location.  

When your company has multiple locations, two general pieces of guidance apply:

1. Always take into consideration all locations - do not be selective.

2. Unless otherwise specified, answer questions only if they apply to 80% of your relevant operations, either your workforce or your facilities (i.e. by square feet or square meters)

To see more specific guidance on how to answer questions in the Workers Impact Area, see this article.