Can nonprofits become Certified B Corps?

Modified on Wed, 5 Apr, 2023 at 3:35 PM

Certified B Corps and Benefit Corporations are neither nonprofits nor hybrid nonprofits. They are for-profit companies that want to consider additional stakeholders, morals or missions in addition to making a profit for their shareholders.Unlike other legal structures (such as 501c3 and L3C), becoming a Certified B Corp or Benefit Corporation does not keep a company from making profits. In fact, many Certified B Corps are extremely successful along traditional financial metrics.


Nonprofits cannot be benefit corporations or Certified B Corporations, but they could create one. Because of the public benefit purpose provisions, expanded fiduciary duties of directors, and additional shareholder rights created within the model benefit corporation legislation, this structure could be useful to operate and scale the earned-income activities of a nonprofit.


It's up to you whether you want to maintain your nonprofit status or convert to a for-profit entity. There are a few former nonprofits in our community who have moved over for various reasons, mostly because their business models grew to include a for-profit product or service. 


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