The Brookings Institution, one of the USA’s oldest nonprofit think tanks, released a paper last week on B Lab and the B Corp movement. Brookings conducts research and education in the social sciences, primarily in economics, governance, and global economy and development.
Authored by B Lab cofounders Jay Coen Gilbert, Bart Houlahan, and Andrew Kassoy, the paper is titled “Impact governance and management: Fulfilling the promise of capitalism to achieve a shared and durable prosperity.” In it, the B Lab cofounders tackle the cultural shift around the role of business in society, the opportunity—and necessity—for businesses to be a force for good, and the institutional and normative barriers in the way. The B Corp movement is profiled as one example of how legal innovation and credible, common standards can transform shareholder capitalism into stakeholder capitalism.
We are in the early stages of a global culture shift that is transforming our vision of the purpose of business from a late 20th century view that it is to maximize value for shareholders to a 21st century view that the purpose of business is to maximize value for society. Significantly, this transition is being driven by market-based activism, not by government intervention. Rather than simply debating the role of government in the economy, people are taking action to harness the power of business to solve society’s greatest challenges. Business—what we create, where we work, where we shop, what we buy, who we invest in—has become a source of identity and purpose. … The important question is not whether or not the culture is shifting, but “what can we do to increase the chance that this culture shift is meaningful and lasting?”