IBMs – what are they, why do they matter, and how to get one

B Corps are businesses that do more than make profit. 

They’re businesses which meet high standards of social and environmental performance, alongside profit. 

The founders of the B Corp movement, who were entrepreneurs themselves, designed a framework, the B Impact Assessment (BIA), to help businesses develop a better way to do business: better for workers, better for communities, and better for the planet.  

The movement has come a long way since its inception in 2006, and there are now over 7,000 B Corps across the globe, including c1,700 in the UK.  The number of B Corps continues to grow rapidly. 

Why? Research shows that 78% of people in the UK believe that businesses should be legally accountable for their impact on people and planet alongside profit (B Lab, 2022), and the B Corp framework is an impactful, structured, transparent way to build a better business. 

As the founders of B Corp recently said in their note ‘Passing the torch’: “The influence of the global B Corp community has redefined success in business.” 

That means forward-thinking business leaders are using the B Corp journey to adapt to the rapidly changing needs and expectations of people and our planet. 

Achieving B Corp certification is no mean feat.  

It’s a rigorous process and takes courage and commitment to consider and improve the impact of your business decisions on all your stakeholders – not just optimising profits for shareholders.  

Embarking on the B Corp journey is the beginning of the road to continuous impact improvement. A journey where you consistently consider how to be the change the world needs. 

And that’s why many B Corp leaders are turning to Impact Business Models as a way of creating real change. Change that is specific, material, verifiable, long-lasting and extraordinary. That’s the definition of an Impact Business Model. 

An Introduction to IBMs 

An Impact Business Model is intentionally designed to create a specific positive outcome for one or more of its stakeholders - such as workers, community, environment, or customers. 

It’s the difference between doing things a bit better and doing better things. 

In total, there are over 20 B Corp IBMs, and as companies become more aware of the responsibility and opportunity to improve their impact on people and our planet, they’re turning to IBMs as a framework to help them. 

IBMs can be based on a product, a particular process, or the business as a whole. 

In the coming weeks, we’ll be looking at a range of IBMs you may find relevant to your business, and we’ll begin by considering the Designed to Give IBM which is in the Community section of the BIA. 

Designed to Give (Charitable Giving) 

As its name suggests the Designed to Give IBM recognises formal written commitment to provide significant portions of company profits, revenue, equity, or time to charitable causes. 

So what does this mean in practice? 

To achieve this Impact Business Model B Lab requires evidence of one or more of the following: 

1) 20% or more of the company is owned by a non-profit organisation,  

2) The company has a formal commitment to donate more than 20% of profits to charity each year,  

3) The company formally committed to donate the equivalent of 2% of revenues or more to charitable partners each year (including in-kind product donations) or 5% in the case of a service-based company. 

 4) The company is formally committed to donating the equivalent of 5% or more of its time through pro-bono services,  

5) The company has created and provides the majority of funding for a non-profit foundation, of which at least 10% of company profits (or 2% of sales) are donated each year. 

If you do not currently have a formal donations commitment, you may apply to achieve this IBM if you can verify that your company has met one of these giving thresholds, in practice, for at least the last 3 years. 

There are an increasing number of businesses that are formally committing a significant percentage of their profits to support local charities and have Designed to Give IBMs. 

Let’s take a look at some you may recognise: 

Naked Sprout – the UK’s “most sustainable toilet roll” scored a whopping 21.5 points for its Designed to Give IBM. 

Working in partnership with the charity Just a Drop, Naked Sprout makes a donation for every box of loo rolls they sell.  

Take a look at the Naked Sprout website to see just how much this partnership is amplifying their impact. It’s impressive. And as a long-standing Naked Sprout customer, it’s good to know that every loo roll, kitchen roll and box of tissues I buy is making a difference to underserved communities across the world. 

Elvis & Kresse  - Elvis & Kresse's highly skilled craftspeople make beautifully designed bags and homeware. 50% of Elvis & Kresse's profits are donated to charities related to their raw materials, 50% of their profits from the fire hose range go to The Fire Fighters Charity. As a loyal customer and huge fan of E&K I’m delighted to see their impact journey grow each year.  

And last but not least, let’s have a look at Earthly a great example of a service business with an Impact Business Model. Earthly is a platform that helps drive investment into high-quality nature-based solutions that remove carbon, restore biodiversity and support local communities. Earthly partners with game-changing projects, across ecosystems, around the world, from kelp farms off the UK coast to regenerative farming in Tanzania to rainforests in Peru.  

Like Naked Sprout, Earthly is a great example of how finding well-aligned partners can amplify your impact. It’s the Aristotle principle: the whole is greater than the sum of its parts

Next time we will take a deep dive at a Customer-focused IBM. Until then, please do contact us if you want to explore how you can get impact on board and make more of a difference to the world.