“Taking Care in Business” is a Corporate Social Responsibility (CSR) podcast featuring guests from around the United States. Each week, guests ranging from business leaders to CSR professionals join hosts Kathy Pedrotti Hays and Vicki Bohlsen to discuss why it is always worthwhile to take care in business.
Episode 51 features Impact Makers’ Vice President of Community Impact, Rodney Willett. As one of the first 40 Certified B Corporations in the nation, Impact Makers, a management and technology consulting firm, is a leader in CSR – contributing 100% of its net profits to charity over the life of the company and gifting all stock ownership to Richmond, Virginia community initiatives. Vicki and Kathy talk with Rodney about the nuances of being a “100%er” and how their service-based business model is unique to that space. Listen in to hear his advice on how to utilize a business model to transform business value into lasting social impact that creates meaningful change for employees, the community and your business.
Being a “100%er” and Helping to “Raise All Ships”
I work for Impact Makers, a technology consulting company based in Richmond, Virginia, one of just a few dozen companies in the U.S. that have made the ultimate commitment as a social enterprise: contributing all profits to charity over the life of the company. Many people have asked us “how is that even possible?” or, more frankly “why would you give away everything?!” We welcome those questions because the answers, described below, reflect our core mission and values: making a difference in the lives of others through our work.
Impact Makers’ all profits to charity structure is modeled after Newman’s Own – the remarkable foundation and company that Paul Newman started in the 1980s leveraging his name and image to sell salad dressings, pasta sauces, and wide variety of other consumable products. To date, Newman’s has contributed more than $535 million in profits to thousands of charities. We are the professional services version of Newman’s, selling cloud migration and data strategy consulting services rather than gourmet popcorn and coffee but with the same ultimate purpose – using our philanthropy to help other people. Since our inception in 2006, we have contributed more than $3.2 million in cash and pro bono consulting services to charities in our communities. More significantly, those charities have used our support to meet the family health, education, and housing needs of thousands of people.
A few practical notes about our model. Yes, we do retain some earnings in order to fund future growth. But we remain true to our 100% commitment because of this important fact: Impact Makers gifted the ownership of our company to two nonprofits – the Community Foundation for a Greater Richmond (TCF) and Virginia Community Capital (VCC). What that gift means is that when Impact Makers is bought or sold, the proceeds of that sale go to those nonprofits. In turn, TCF and VCC have committed to using the proceeds to fund impact investments in other social enterprises trying to make a difference in their communities.
The success of our social enterprise has inspired at least one other consulting company to copy most of our structure and create a similar, lasting community impact. There has been a broader impact, however, as other types companies have found inspiration from Impact Makers, Newman’s Own, and the other 100%ers to create their all profits to charity endeavors. And still more significant than that, a much larger number of companies have been moved to do more for their communities through financial and volunteer support efforts, even if they are not making the 100% commitment. Are those companies doing more because they now are more concerned about their social impact or just because of pressure to keep up with competitors that have a social impact? Regardless of the motivation of those companies, they have been affected and are doing more: the rising tide of social enterprise led by the 100%ers is causing many corporate ships to rise.
Learn more about Impact Makers’ Business Structure
What is a Certified B Corporation?
Certified B Corporations are businesses that meet the highest standards of verified social and environmental performance, public transparency, and legal accountability to balance profit and purpose. B Corps are accelerating a global culture shift to redefine success in business and build a more inclusive and sustainable economy.
As a society, our most challenging problems can’t be solved by government and nonprofits alone. The B Corp community works toward reduced inequality, lower levels of poverty, a healthier environment, stronger communities, and the creation of more high quality jobs with dignity and purpose. By harnessing the power of business, B Corps use profits and growth as a means to a greater end: positive impact for their employees, communities, and the environment.
What is a Benefit Corporation?
A benefit corporation is a legal designation that establishes a company with a solid foundation for long term mission alignment and value creation. It protects a company’s mission through leadership or ownership changes. A benefit corporation is a traditional corporation that commits to higher standards of purpose, accountability and transparency.
Traditional corporations are expected to make decisions that maximize profits, but this can be a barrier to making a lasting impact on broader stakeholders, such as employees, community, and the environment. Benefit corporations are required to consider all stakeholders in their decisions.
How are B Corps and Benefit Corporations different?
Impact Makers is both a Certified B Corp and a benefit corporation, so they are often incorrectly used interchangeably. The B Corp certification is earned through an assessment of a company’s social, environmental, and community practices. It is like being certified organic but instead of fewer chemicals, it means the company’s processes and policies have been found to support purposes beyond profits. A benefit corporation is a type of for-profit corporate entity where there is protection for a company’s mission and commitments. It is authorized by 34 U.S. states and the District of Columbia as a legal classification, like LLC or S-corp.