Summary
Corporate social responsibility (CSR) is a broad term used to describe a company's efforts to
improve society through its operations. Despite the growing body of literature on this concept,
findings surrounding its financial effects on a corporation are inconclusive. This paper
investigates a new, fast-growing type of organization - called a certified B Corporation (B Corp)
- to build on the scholarship that assesses the relationship between social and financial
performance within organizations. Specifically, the aim of this thesis is to 1) to add to the
research on the relationship between social performance and financial performance by examining
it within B Corps, 2) to weigh the value of different definitions of CSR, and 3) to discuss the
conditions under which the B Corp certification can add value to firms. Empirically, this paper
statistically tests the association between the B Corp certification and annual revenue, along with
analyzing extensive interviews with B Corp employees. This study finds that certified B Corps
have a stronger, more positive correlation with corporate financial performance than regular,
matched, non-certified corporations. The interviews further reveal a selection effect among B
Corps that suggests the certification itself may not be a cause for heightened financial
performance. However, the certification is found to produce advantages of continuous
innovation, passionate job applicants, and entrance into a community of like-minded businesses.
Finally, skepticism and rejection of the concept of CSR by B Corp employees leads to the
conclusion that truly socially responsible companies do not use the term. While CSR is generally
understood as a separate department within an organization, for these certified B Corps, socially
responsible practices are ingrained into every aspect of the business.