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The GreenBiz Interview

B Lab co-CEO Anthea Kelsick: ‘Innovate against your model’ to address systemic racism

B Lab Co-CEO Anthea Kelsick

B Lab Co-CEO Anthea Kelsick

B Lab

Anthea Kelsick, a strategist who started her career in the oil and gas industry, was named co-CEO of the U.S. and Canada operations of B Lab in January — just two years after joining the firm as chief marketing officer.

B Lab is the organization behind the globally recognized B Corporation status. Founded in 2006 by three former university classmates after witnessing the structural challenges of creating, growing and maintaining a responsible business, B Lab today counts over 3,500 companies in more than 70 countries across 150 industries as B Corp certified.

By adopting the B Corp certification, companies are required to consider the impact of their decisions beyond shareholders, and include impact on their workers, customers, suppliers, community and the environment. B Corps pay an annual fee, ranging from $1,000 to over $50,000, according to their revenue.

Many companies choose their certification to lead a movement, build relationships, attract talent, improve impact, amplify voice and protect their mission. In early September, a coalition of multinational companies led by Danone and Natura launched the B Movement Builders, a mentor program for other large global companies interested in pursuing B Corp status.

Kelsick’s work at B Lab is driving corporations beyond business as usual, providing firms with both tools and a community to better serve their customers, employees, shareholders and planet. Under Kelsick’s leadership, B Lab has taken a role in umpiring the more controversial issues in what constitutes a sustainable business as well — from for-profit universities to businesses that profit from mass incarceration. Her words are definitely ones to heed for 2020 and beyond.

I sat down virtually with Kelsick to discuss her journey, the role of racial justice in sustainable business strategy, why large companies should pursue certification and how corporations should respond to all that is the year 2020.

Following are excerpts from our conversation, edited for clarity and length.

Marilyn Waite: You’ve studied something that I find fascinating, partly because of the way it has challenged economic theory: psychology. Why did you choose to study psychology and what if any role does psychology play in your work as co-CEO of B Lab?

Anthea Kelsick: I grew up in a multicultural, multiethnic, multigenerational household. My mother’s side of the family were ethnically white but multicultural — being part of the Royal British Army, my mother’s siblings lived in Egypt, Canada, France and the U.K. My father’s side of the family is from Dominica; he spent most of his life in the Caribbean, attending the University of the West Indies where he met my mother. I was born in Vancouver, Canada, and later moved to the South Side of Chicago where my father had family.

I had the joy of being a perpetual outsider. It was the only thing that I knew, and I view the outsider perspective as positive.

Needless to say, I had the joy of being a perpetual outsider. It was the only thing that I knew, and I view the outsider perspective as positive. This way of being made me very curious: How do people think, behave and make decisions? How and why are people different? These questions led me to the field of psychology. I wanted to understand people and how they make decisions.

After graduating with a degree in psychology, I moved to France where I had family. At that time, I was just looking for a job. I found a position as a research analyst, which is all about how companies make decisions, and it happened to be in the oil and gas industry. I enjoyed uncovering the right data to influence someone else’s perspective. My entire career from then was in professional services and consulting, which later led to branding, marketing and advertising.

Waite: What’s the history of B Lab? What was the first B Corp certified company? Is there a concentration in the types of sectors or industries attracted to B Lab?

Kelsick: There were three founders of B Lab, all college friends. Two of them founded a company together that was acquired by a large corporation. During the acquisition, they saw how their model of sustainability, including taking care of employees, was decimated. The two teamed up with another classmate who, while working in private equity, came to the conclusion that the "source code error" of capitalism was shareholder primacy.

The three founders incubated a series of tools, one of which is a mechanism called the Benefit Corporation whereby companies can opt into a legal structure around social and environmental — or wider stakeholder — returns. That Benefit Corporation legal structure exists in over 38 U.S. states, as well as four countries: Ecuador, Italy, Colombia and (British Columbia,) Canada. The charter, or a version of the charter should the Benefit Corporation legal framework not be available in a certain jurisdiction, is a prerequisite for B Lab’s Certified B Corporation.

There was no singular first B Corp but rather a cohort of 20 pioneering companies that spanned many industries, including Oakland-based Numi and Green Retirement. Historically, certified B Corporations have been in the consumer product industry, but as we’ve grown, we have a 50/50 split between B2B and B2C companies.

Waite: I’ve noticed the trend of more banks and financial institutions becoming certified B Corporations. What has led to this uptake? What does certification offer to a bank?

Kelsick: At the outset, we witnessed smaller banks, community banks, community development financial institutions (CDFIs) and private equity firms as first movers among financial institutions.

These institutions have generally been attracted to the B Corp status as a way to differentiate themselves. Once they are in the B Lab community, they find the tools to be an incredible management advantage and a tool for continuous improvement.

B Corporations achieve a minimum verified score on the B Impact Assessment and make this impact report transparent on bcorporation.net. They also amend their legal governing documents to require their board of directors to balance profit and purpose.

Bank executives like Keith Mestrich, president and CEO of Amalgamated Bank, also point out that B Corp certification is important for attracting and retaining talent, and from an internal management standpoint. We have not yet tracked closely the trends in the financial services space, but we are keen on exploring this further.

Waite: In addition to banks, why should large, public companies become B Corp certified?

Kelsick: Traditionally, the primary reason that companies have been driven to B Corporation status has been differentiation. In general, we see an uptick in certification demand in those sectors where consumers are becoming more conscious; that has meant fashion and apparel, whose emissions come second to oil and gas in terms of carbon footprint, as well as insurance and banking.

We are seeing a lot of large private and public companies, such as Danone, approach B Lab. Transforming such large corporations requires a lot of time, investment and most importantly, a visionary leader. CEOs are coming to us because there is external demand. 2020 has exceeded our predictions; we have seen a 25 percent increase in B Lab assessment submissions globally. That’s pretty dramatic.

Waite: You’ve written a manifesto on Tackling Racism As Accountable Business Leaders. How can businesses dismantle racism and white supremacy?

Kelsick: I’m personally exhausted yet optimistic. The desire for change, especially in how businesses impact Black communities, is heading in the right direction. We have to watch out, however. This is a moment in time when all of the initiatives can easily become one-off, as opposed to the first step in changing the way we work over the long run. We don’t need any more Band-Aids.

At B Lab, we are developing a coalition with policy leaders, academics and businesses to create a systemic anti-racist playbook. I propose a three-pronged approach to the business community for becoming truly committed to ending racism.

First, have a look inside of the company. Progress starts at home. We hold on to principles of white supremacy because we are born into them. Don’t siphon diversity and inclusion off to the departments in charge of people and culture only.

Look at all practices. Have you set targets to hire, pay and promote a diverse workforce? What does the board look like? Are you paying a living wage in your supply chain? Do we have pay equity everywhere? Have a look at the wage situation of your Black and Indigenous employees — that’s likely a good place to start. Be specific and focused.

This is a moment in time when all of the initiatives can easily become one-off, as opposed to the first step in changing the way we work over the long run. We don’t need any more Band-Aids.

Second, have a look outside of the company, in the community. The infrastructure that enables your business to run exists somewhere on the planet, whether through headquarters, affiliate offices or supply chains. Are you using your power and influence to positively impact the community? Are you working to change policy outcomes that benefit people, especially communities of color, and the planet?

Third, have a look at how your company can impact broader systemic structures. A company’s voice can certainly extend beyond its own consumer and worker base. I’m excited to see companies showing up and talking about race, using terms like white supremacy to explain systems that hurt people and planet and ultimately the bottom line. Use your brand as a means to shift public opinion; for example, invest in efforts that support mask wearing during COVID.

Think: What’s the civic duty of a company? Companies must become accountable members of society and use their efforts to go beyond their own brand advocacy. Step up as conscious members of society and use lobbying dollars to reverse climate change, create equitable health outcomes and dismantle white supremacy.

Waite: Our readers are chief sustainability officers and other members of the C-suite across various industries. What’s the one lesson that you want them to take from all that has happened in 2020?

Kelsick: The biggest lesson is to grab hold of the opportunity that the current crises have created for us. Innovate against your model. Well before the current moment of racial injustice reckoning, companies knew about and were active in perpetuating wage disparities. Ask yourself: What are you specifically doing?

Ben & Jerry’s, in addition to releasing their own manifesto on racism, started a new podcast as one way of using their voice to enact change. Sundial Brands, which owns Shea Moisture, has created several funds to invest in Black women entrepreneurs, including in the wake of COVID. Become policy activists for solving our most pressing challenges.

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