It’s a concept taking hold across the country, including in Alabama, among existing companies and entrepreneurs: how to build successful businesses that blend moneymaking motives with a dedicated mission to do good in the community.
One way is for a business to become a legal benefit corporation or certified as a “B Corp,” which adds a social or environmental mission to a company’s core focus, along with making a profit. State lawmakers in 2020 approved such a structure for Alabama businesses, and interest is mounting among companies – and those looking to start one – about B Corps.
Master of Business Administration students at the University of Alabama have taken an interest in the B Corp model. This past semester, 11 students from the Culverhouse College of Business took a class that paired them with Alabama businesses and startups that see opportunity in becoming a B Corp or strengthening their social mission. During the “B Corp Academy,” students worked with 10 businesses, providing them counsel and ideas for expanding positive impacts in the community. And for those companies involved in the class that are considering getting certified as B Corps, the students helped craft a roadmap for next steps.
Staff from the Alabama Power Foundation, which works with Alabama companies interested in the B Corp model through its strategic initiatives program, helped teach the course.
Mark Bernstiel, who heads the foundation’s impact-investing efforts, which include the B Corp initiative, described the class as an “impact-improvement project” for the businesses that participated and the students who worked with them. Bernstiel was among three experts from the foundation who supported the class.
“This was a mutually beneficial opportunity, for both the students and the businesses,” Bernstiel said, exposing both to the advantages of seeking benefit corporation status, or in seeking other ways to increase social impact.
Among the Alabama businesses in the class were long-established enterprises, such as Birmingham’s Bottega restaurant, and ones just starting, including NIA Benefit Corp., which hopes to fill a gap in access to burn care in many areas of the state through telemedicine. Birmingham-based Filter Coffee Parlor and GoCamp, a female-led, peer-to-peer campervan rental company, also participated, along with several companies involved in the recent Alabama Launchpad Social Impact Competition put on by the Economic Development Partnership of Alabama with support from the Alabama Power Foundation. The participants from Alabama Launchpad were Monthly, Reboot Reforestation, Pearl’s Café, VB Ideas, Kaya and Generational Systems, which are growing businesses focused on societal issues: from providing affordable and sustainable women’s underwear, to helping underserved students boost college entrance exam scores, to providing jobs for the disabled, to sustainable forestry, to expanding 3D printing access, to broadening access to mental health support.
“I had a phenomenal experience with all the students,” said Aiko Pickering, founder of Monthly, who on Dec. 8 was awarded $25,000 as the concept-stage winner in the Alabama Launchpad competition.
“They made me think about things I’ve never thought about – about making sure I’m thinking about social impact from the very beginning,” said Pickering, who intends to seek B Corp status as her Mobile-based company begins to ramp up toward production of sustainable underwear for women.
She said the students, in analyzing her business plan, offered valuable recommendations, such as being thoughtful about the manufacturing process, including where to manufacture her product, as part of her social impact strategy.
Wendy Lawless, of Pearl’s Café in Birmingham, said the interaction with the UA students was valuable. At the center of Pearl’s mission is hiring disabled employees, who are significantly underemployed across Alabama.
“They really helped me think about my vision and about how to get the word out,” Lawless said, including potentially partnering with other nonprofits that work with disabled people.
MBA students Rosemary Neal and Angel Shadd attended the Alabama Launchpad’s live pitch competition to see how some of their “clients” performed. They had worked closely with Pickering during the class.
“It was a unique experience,” Shadd said of the class, which was distinct from many of the more number- and theory-oriented classes that are part of the MBA curricula. “We really got to see the added value that comes from the social impact side.”
While Pickering had “a very clear vision” for her business, Neal said she and Shadd were able to help Pickering articulate it in a revised company mission statement. They helped Pickering refine elements of her business plan to better reflect her passionate focus on the social impact of her business.
“It’s not about profit; it’s about the people,” Neal said about Monthly, which Pickering first considered launching as a nonprofit to help poor women who can’t afford feminine products, but then realized the mission could be more sustainable by creating a for-profit company backed by investors and with a strong, social impact focus.
Neal said it was clear that with Monthly, “it’s less about ROI (return on investment) and more about return on impact.” She said the experience working with Pickering was “refreshing.”
Lou Marino, professor of Strategic Management, department head and the James Nabors Instructional Excellence Faculty Fellow at the Culverhouse College of Business Department of Management, said: “It is critical for our students to recognize the responsibility and privilege they have as leaders to impact society and their communities positively.”
Marino praised Jef Naidoo, associate professor of Management and the Derrell Thomas Teaching Excellence Faculty Fellow, who led the B Corp Academy. Marino also thanked the Alabama Power Foundation for its partnership on the project.
“This innovative experiential learning initiative led by Dr. Naidoo enabled our students to help drive the growth in the B Corp ecosystem in Alabama while learning about this new type of governance structure,” Marino said.
Bernstiel said the foundation is always looking for opportunities to spread the word about the B Corp model. He can also provide information and resources to business owners and entrepreneurs who want to learn more about benefit corporations.
Bernstiel said research shows that women- and minority-owned companies are more likely to pursue B Corp status, which ties into the foundation’s interest in helping expand the number of diverse businesses across Alabama.
To learn more about the foundation’s strategic initiatives program, impact investing and its work related to B Corps, click here.