G is for Governance (Not Greenhushing)

Companies continue to increase budget and take on staff to tackle social and environmental impacts but they’re no longer sharing their progress. This is known as Greenhushing. At Junxion we know that momentum towards Social Purpose is building and success stories help to build the Purpose Economy. If we don’t have public representation of companies disclosing their data and stories of how they are tackling their impact then we have a void where indifference breeds. Standardized governance plays a critical role in balancing power structures within businesses in relation to social and environmental impact on stakeholders. Not only does the B Corp Certification provide a way to assess standardized performance but it has also created a movement of businesses stepping out to tell their stories together, now 1000 strong in the UK alone.

Good governance ensures an organization’s ethos and its stated values permeate individuals’ behaviours, shared beliefs, and decision-making. The B Impact Assessment (BIA), the rubric that underpins the B Corp certification, assesses an organisation’s governance in terms of its mission, engagement, ethos and transparency. The linchpin of B Corp certification is the Mission Lock—a legal commitment to hold all stakeholders equal to shareholders. 

This may sound like a stretch for the average company but consider the alternative. What happens when governance of social and environmental impact isn’t written into job descriptions and executives are not incentivised for their impact efforts and consideration of all stakeholders? PwC recently surveyed 704 Board Directors with “only around half having discussed climate change or carbon emissions at this frequency (“substantially” or “somewhat”) over the past 12 months, fewer than a third discussing human rights, and only 30% discussing corporate political activity”.

Indeed, on Monday 11 October 2022, British Cycling announced Shell as their new corporate partner. The response from members, staff and commentators was swift and merciless. Hundreds of members, partners, employees and other stakeholders publicly eviscerated British Cycling; “brazen sportswashing” was in The Telegraph’s sub-line. On 31 October, the CEO stepped down. Given how tone-deaf the decision appears to be, one wonders what governance was in place when each of the levels of approval at British Cycling considered the impact on their stakeholders of this elite bike racing sponsorship deal. 

Don’t even get me started on FIFA’s decision to award Qatar the World Cup host. (More on that in an upcoming Junxion post.)

Just like Ace & Tate eyewear, who communicated their brand new B Corp certification with the headline: Look, we f*cked up, before sharing a list of the bad moves they made and the policies and processes they’ve put in place to improve their impact.

Five Key Governance Practices Aligned to the B Corp Certification

1. Appoint an Advisory Board or put an Independent member on to the Board of Directors. These should be demographically diverse, independent advisors, that could be professionals with specific expertise, a staff member to represent employees, or a loyal customer with deep experience of your product or service. These stakeholders bring different perspectives and expertise that can illuminate risk or impact opportunities that you might not have recognized or assessed. 
2. Include social and environmental responsibilities in job descriptions and link executive pay to social and environmental targets. Embed your strategic approach to your impact into every part of the experience of being an employee. This ensures there are no mixed messages––it’s in your job description and your remuneration is linked to delivery of these objectives. 
3. Put policies and processes in place to create Justice, Equity, Diversity and Inclusion. For example, ensure your job adverts can be seen by people outside your own network, and redact identifying information from applicants’ CVs. Build relationships with diversity-related organisations and across stakeholder groups so you can identify a broad representative of networks to publish job adverts. 
4. Align your governance to your purpose and mission. You don’t have to become a B Corp to align your interests with wider society and the environment. Public companies in the UK and their directors can weigh and advance the interests of all stakeholders by signing up to the Better Business Act (BBA).
5. Tell your story. When you become a B Corp, it’s a requirement that you publish an impact report every year. But it’s also a pivotal part of any company’s public and internal accountability and transparency. Be consistent with your narrative and data, be humble and acknowledge your failures. 

Policies and processes can easily become greenwashing if organisations are not willing to actively listen, hear and collaborate. When you’re confident you’ve done these things then there is no reason not to shout your stories from the rooftops.