Can Benefit Corporations Work? →
Why would any company tie its hands this way? Neil Blumenthal, one of Warby’s co-founders, told me, “We wanted to build a business that could make profits. But we also wanted to build a business that did good in the world.” That sounds pretty, but it’s a kind of goal that can be easily discarded when running a for-profit business. Becoming a B corp raises the reputational cost of abandoning your social goals. It’s what behavioral economists call a “commitment device”—a way of insuring that you’ll live up to your promises.
Fascinating idea. Makes me glad (one of many reasons, actually) to have purchased several pairs of glasses and sunglasses from Warby Parker. It also raises the notion that perhaps there is a flip side to the Corporations-are-people mindset. Maybe the person that corporations model themselves after doesn’t have to be Scrooge McDuck.