B Corps Catching on in Taiwan

The launch event for B Lab's Business for Good platform. Photo: B Lab Taiwan

The private certification program helps companies develop core values and policies that benefit all stakeholders.

A growing worldwide trend for companies to certify their commitment to sustainability and accountability has also been gaining traction in Taiwan. Within the past three years, 27 Taiwanese companies have received B Corporation (also known as B Corp) certification, more than any other country in Asia.

Among the perceived benefits of the process is to increase companies’ ability to attract and retain talent from among Taiwan’s youth, helping to stem the tide of young Taiwanese leaving the island for higher salaries and more promising career paths abroad.

B Corp certification is administered by the U.S.-based non-profit B Lab. The organization uses an impact assessment score to determine the level of an applicant company’s dedication to social and environmental sustainability while still striving to be profitable in adherence to the three bottom-line principle of “people, planet, profit.”

The B Lab Taiwan member organization was established in 2016 by a group of founders with backgrounds in the non-profit, impact investment, and business consulting fields. Chloe Huang, the organization’s secretary general, views companies as fitting along a spectrum. “At one end, you have traditional companies, only looking to make money, and on the other side there are non-profit organizations, for whom money is secondary.”

She sees B Corps as coming squarely in the middle, offering what is called an “impact business model” based on the notion that sustainability and profitability should both be part of a company’s core values. “We can have a good heart, but also make money,” says Huang.

B Lab Taiwan’s founders have promoted the program by holding seminars and workshops and reaching out to their connections in academia, government, and industry. They have persuaded a wide array of different businesses to take their Corporate Social Responsibility (CSR) efforts to the next level by becoming certified B Corps.

The companies featured in this report represent the diversity of industries and corporate structures that have become part of the growing B Corp community in Taiwan. O-Bank is a large public financial services corporation specializing in online banking; Winkler Partners Attorneys at Law is a full-service law firm based in Taipei; and Greenvines is a producer of green personal care products made from an extract of living sprouts grown by its R&D team.

Challenging process

Taiwan’s feat in hosting more B Corps than any other country in Asia is not totally surprising. The “economic miracle” in Taiwan was mostly attributable to strong government incentives and the hard work of small- and medium-size enterprises, many of them family-owned. As the founders of those companies now pass the torch to the next generation, their successors are looking for ways to renew the value of the companies and attract younger talent.

Some of these enterprises have begun implementing more employee- and community-friendly policies and initiatives, such as free childcare for employees and waste-reduction and energy-saving programs.

Harris Cheng, co-founder and CEO of Greenvines, says that many Taiwan-based start-ups already have mission statements and goals that are similar to the B Corp vision of using business for social good. “There are two kinds of B Corps,” Cheng notes. He refers to the first kind as “natural-born” – startups that are already imbued with the B Corp ethos and for whom “it’s much easier to get certification quickly.” The second group consists of more traditional companies that need to make some significant changes before they can qualify.

Although Taiwan has long had a culture of extensive working hours, often without overtime pay, working conditions in Taiwanese companies are notably better than in most countries in the region. Laws and regulations, such as the Act for Gender Equality in Employment, help to promote equitable, inclusive workplaces, even if they are not always consistently enforced.

Nevertheless, obtaining B Corp certification can be immensely challenging for potential applicants. The impact assessment includes 200 questions for use by reviewers to assess a candidate’s suitability. The assessment covers four major areas: corporate governance, work force, environment, and community. Questions explore such areas as workplace diversity, transparency of information and decision-making, the type and amount of environmentally friendly products offered by a company, and employee compensation, benefits, and training.

James Hill, who is in charge of communications at Winkler Partners, notes that sections of the assessment focus on an applicant company’s entire supply chain, and that the information supplied has to be detailed and meticulously organized. “The emphasis is on buying local and our accounting system didn’t distinguish where we spent money” by locality, he says.

Another issue is that the questionnaire is entirely in English and the answers must be entered in English as well. The questions can be quite complicated and thorough, making completion of the assessment difficult even for native English speakers.

Lastly, due to the comprehensive nature of the assessment, a large company or conglomerate will need to decide whether to start by certifying each of its subsidiaries and affiliates separately or instead apply directly for a single certification covering the organization as a whole. O-Bank opted for the latter approach.

According to Joy Siew, the bank’s senior vice president and head of corporate communications, all wholly or majority-owned subsidiaries needed to be included in the scope of the assessment, and a weighted average score of 80 was required for certification. She notes that for O-Bank, a multinational publicly listed company, this process required significant interdepartmental communication and cooperation, as well as alignment of all subsidiaries on various social and environmental initiatives. Even though O-Bank was successfully certified, only the parent company is entitled to use the certification in connection with its business. Individual use of the B Corp name by its subsidiaries would require them to undergo separate certification processes.

Despite the difficulty of becoming certified, Siew says that aspects of the application process, such as the business impact assessment, are valuable tools for enabling a company to “do well by doing good.” Since the assessment is updated regularly and recertification is required every three years, both new applicants and certified companies are able to “use benchmarking to track their progress and determine which areas are in need of improvement,” she notes.

Looking for improvement

Improvement in one area or another is usually necessary for recertification. For companies in Taiwan, that has primarily involved increasing the level of transparency and information-sharing among different departments. At Wink-ler Partners, partner Peter Dernbach says that one of the notable changes at the firm was formalizing a number of B Corp-friendly policies and rules that had long been in place but not documented in writing.

Chloe Huang of B Lab says that local Taiwanese companies tend to score well on the community portion of the assessment, but tend to fall short on environmental initiatives. She mentions that to improve in this area, one company implemented an employee incentive program that rewards workers who ride their bikes to work or use environmentally sustainable consumer goods. The program was considered successful in that it not only enhanced the company’s overall assessment score, but also encouraged broad employee participation in the effort.

Assistance is readily available for companies looking to undergo the certification process. Cheng of Greenvines notes that becoming a B Corp allows applicants and newly certified companies to tap into a local and global community network, through which they can exchange ideas about best practices and give pointers on how to boost scores on the impact assessment.

Chloe Huang also calls attention to the Business for Good platform, a training program and online resource launched in late July this year. The platform has partnered with both certified B Corps and large corporations such as Cathay Financial Holdings and Carrefour. “As long as a company is thinking about its sustainability, it’s welcome to join,” says Huang. “We have experts and mentors who can support businesses with developing sustainability strategies and formulating their impact business models.”

Business for Good also arranges for Taiwanese university students to help companies applying for B Corp certification collect and organize the necessary data and complete the assessment. For the students, it is a valuable opportunity to be exposed to sustainable business concepts and gain practical work and internship experience.

Among the benefits of becoming a B Corp are the development of greater transparency in corporate governance and promoting a better brand image, thereby creating more consumer trust in the company’s products or services. Another potential benefit, and one that is very pertinent to Taiwan, is the role of the certification in helping to attract and retain talent, especially with regard to the younger generation.

Taiwan has faced an exodus of young talent leaving the island in search of better salaries and more attractive career opportunities abroad. This brain drain has been exacerbated by incentives provided by the Chinese government designed to attract recent graduates from Taiwan. By moving to China, young Taiwanese working in certain sectors can sometimes make three or four times the salary available in Taiwan.

Young people who are socially and environmentally aware may factor those considerations into their employment choices. Siew of O-Bank says that many of the company’s new recruits and interns have cited its B Corp certification and environmental, social, and governance initiatives as key reasons for their decision to work there.

At Greenvines, Cheng says the company has attracted a number of talented young Taiwanese who “are motivated by the company’s mission and the career prospects” there. In addition, the turnover rate is quite low and the level of employee engagement is high.

Dernbach of Winkler Partners notes that B Corps are engaged in introspection in how to make work more meaningful. “We’re asking: How can we be more of a purpose-led, mission-driven organization? How can we make more of a contribution? How can we use our business for good?”

Disclaimer: the author was previously employed by Winkler Partners.

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