The Cost of B-ing Good

Read any article enumerating the current or emerging trends in restaurants and retail and you will see ideas of health and wellness, environmental sustainability, and brand authenticity coming to the fore. These trends are driven by Millennial and Gen Z consumers, who are more willing to pay a premium for sustainable products; those consumers also tend to be more online and acutely aware of the impact of business practices on the lives of people and the future of the planet. 

B Corp Certification, a credential bestowed by the non-profit organization B Labs, is a way for businesses to address those concerns and more as they undertake an in-depth auditing process, and come out with a seal of authenticity around their sustainability and social responsibility claims and a branding kit to help promote it. 

If certified B Corps are getting what they’ve invested in, you may have seen the logo and associate it with some of the most notorious “do-gooder” brands: Patagonia, Ben & Jerry’s, Toms, and Thrive Market. And you are hopefully starting to associate the circled “B” with businesses that you seek to support for their mission and ESG (environmental, social, & governance) commitments as much as their product. 

But is B Corp certification something restaurants should pursue?

B Corp Restaurants

As of early 2024, almost 150 restaurants around the world have achieved the certification, from fine-dining independents to fast-casual chains, with hotels, breweries and food delivery companies also dotting the list. 

Restaurants like Hawksmoor, a steakhouse chain in the UK and NYC, Hog Island Oyster Company in California, and Just Salad, an East Coast, fast-casual chain, have all been vocal in recent years about the work – and pride – of becoming a B Corp as a restaurant. I have been fortunate to work with Sleepy Bee Cafe since its founding in 2013. We are a breakfast and lunch concept in Cincinnati, Ohio and we have been B Corp certified since January 2023. Being assigned to help the brand achieve B Corp certification was incredibly exciting – and a project that dominated a lot of my time over the last three years. The assessment is exhaustive and, for restaurants, it has to be done within the boundaries of the business model, which are not particularly flexible.

At Sleepy Bee, our work towards B Corp certification began in the summer of 2020, a time when many of us in the industry were wondering, “What are we doing here?” as our ability to staff a kitchen and invite guests into our dining room was replaced with whatever pandemic-friendly forms of food service our creativity could conjure. 

B Corp was one of a few certifications or collectives we investigated to find guidance and validation for the way we do business, particularly our long-standing sustainable sourcing mission. Green Restaurant and Slow Food were others we considered. But it was the pivots in the pandemic that pointed us toward B. Our pandemic priority was people, more than food, and we were able to instate employment policies and HR standards that are radical for the industry, but caused few waves in the chaos. And B Corp was the only one looking at both environmental and social scorecards. 

Because it aligns with UN Sustainable Development Goals and remains broad enough that a range of businesses can be certified, B Corp is the most holistic and comprehensive measure of business sustainability out there. 

Doing the Work 

Aspiring B Corps have to submit data and policies to prove how they measure up in the categories of Governance, Workers, Community, Environment, and Customers. A combined score of 80 out of 200 is required. Initially you will submit a self assessment of what practices or policies are true for your organization. Once that is submitted you are subject to a thorough review. For Sleepy Bee, we submitted our assessment in June 2021, entered the review process in March 2022, and completed it in November of 2022.

Governance – 20 points

To meet governance qualifications, the most important thing you need to do is put a B Corp mission statement into your official business filing and operating agreement documents:  “The purpose of the company shall include, but is not limited to, creating a material positive impact on society and the environment, taken as a whole, from the business operations of the company.”  Additionally, you will speak to or put in place written policies around employee and manager expectations and a code of ethics.

Workers – 40 points

To address employee concerns, you will be asked to discuss pay structures and scale, benefits packages and distribution and speak to the health and safety of your operation. In general, questions are broken out into a) what would you claim is true about your businesses policies and practices and b) your methodology for and frequency of measuring that they are indeed in place. During the pandemic, we implemented a whole-house tip pool and instituted an internal $15 minimum wage. We measured our pay differentials by position, pre-2020 vs. 2023, and we have leveled the playing field between front and back of house employees (previously a >$10/hr gap) and to ensure everyone is making an individual living wage. 

Community – 70 points

This category is the largest and offers the most room for a business to gain points, with 70 available, so it’s not surprising that the majority of restaurants see the bulk of their points related to community efforts, with typically around 24-36 points gained. 

There are questions about DEI efforts in the workplace and what civic engagement or charitable giving you might champion, but the biggest section dives into your supply chain management and local economic development. How much you choose to source from local suppliers (for food, packaging, retail items, etc), the ways in which you hold your larger suppliers accountable to their impact, and how specifically you are committed to serving the communities in which you operate are all factors that will be considered. 

Environment – 45 points

For environment, you will look specifically at your management of materials and space. Greenhouse gas emissions data may not be readily accessible for most restaurants, but by working with programs like Energy Star Portfolio Manager, you can measure and set goals for energy and water use. 

Waste management programs like recycling, composting, and any food-waste reduction measuring done can also help in this category. At Sleepy Bee, we found a lot of success in working with our chefs individually, to aim their purchasing decisions towards our local and preferred suppliers and to conduct week-long food waste audits to better understand what our food waste streams looked like and how to reduce them. 

Customers – 5 points

This is both the smallest category and potentially the least relevant for a restaurant looking to be a B Corp. You can make a case for your product directly addressing a social or economic problem if that feels true for your business, but more likely in this industry, you are trying to serve people delicious and conscientious food, and whatever social or environmental good you are doing with the business is done with the revenue from selling that food.  

Is It Worth It?

Achieving and maintaining B Corp certification is not easy for any business, but restaurants operate with notoriously small margins and even more unpredictable costs, especially since the pandemic. Each choice that could help you earn those 80 necessary points comes with a cost – be that in the labor hours of data retrieval and organization, or the choice to provide good pay with benefits and buy mission-driven products across every part of your operation. 

There are less than 200 food businesses with B Corp certification, and less than 50 are operating a service-oriented restaurant. Those restaurants that make it are barely breaking the point threshold, with an average of 82 points. And recertification happens every 3 years, so businesses that hit enough marks for initial certification need to continue and evolve those policies in order to maintain it. Hog Island Oyster Company, a proud ambassador of B Corp certification in a 2019 Food & Wine article, has since let go of the certification. They remain a benefit corporation in the state of California (a corporate entity designation available in 36 states). This could indicate many things, but leaves question in my mind to whether or not there is enough of a return on investment from this (or any) “seal of sustainability.”

For Sleepy Bee, we will continue to keep B Corp certification and the principles it represents embedded in the foundation of our business, but choosing to do so may require change. As we wrestle with margins in a post-pandemic restaurant world, our choices may only be justifiable with investment in other revenue sources. We have and will continue to creatively challenge the notion of restaurants: How they work, how we experience them and who they really serve. 

But if we strive to stay a B Corp, we may have to decide: Will we continue to be a restaurant business or a business that has restaurants?