Empowering Sustainable Growth: Incentivizing Public Benefit and Certified B Corporations in New Jersey
As Governor, I am committed to fostering a business environment in New Jersey that empowers corporations to grow without additional state-imposed regulations. However, we recognize the tremendous value of companies that go above and beyond by prioritizing the well-being of their employees, their communities, and the environment.
To support this commitment, New Jersey will incentivize corporations that transform into Public Benefit Corporations or pursue Certified B Corporation status. These forward-thinking businesses will gain access to state benefits as a reward for their dedication to sustainable practices and corporate responsibility, advancing a brighter future for all New Jerseyans.
A Public Benefit Corporation (PBC) and a Certified B Corporation (B Corp) are two types of business structures that integrate social and environmental goals into their corporate missions, but they differ in how they’re legally defined and certified.
Public Benefit Corporation (PBC): A Public Benefit Corporation is a legal designation available in some U.S. states, including New Jersey. Unlike traditional corporations, PBCs have a stated purpose of creating a positive impact on society, employees, communities, and the environment, in addition to making a profit. The PBC structure requires the company to consider the effects of its decisions on stakeholders (employees, customers, communities) alongside shareholders. This dual-purpose allows companies to legally prioritize social and environmental goals, giving them more freedom to focus on sustainability, ethical practices, and long-term impacts, rather than solely on profit maximization.
Certified B Corporation (B Corp): Certified B Corporation status is a voluntary certification provided by the nonprofit organization B Lab. Companies seeking B Corp certification undergo a rigorous assessment to meet high standards of social and environmental performance, accountability, and transparency. B Corp certification is available to businesses of any structure or industry and requires a company to score well on metrics such as environmental practices, treatment of workers, community impact, and governance. To maintain certification, companies are regularly reassessed to ensure they continue to meet B Lab’s standards.
In essence, while both PBCs and Certified B Corps commit to positive social and environmental impact, PBCs are a legal business structure, and B Corp is a third-party certification. A company can choose to be one, the other, or both, with many B Corps opting to become PBCs to align their legal structure with their mission. Together, these models enable businesses to make a positive impact without sacrificing profitability, supporting the goal of a purpose-driven economy.
Transforming into a Public Benefit Corporation or Certified B Corporation brings a range of benefits to employees, communities, and the environment, creating a well-rounded, sustainable impact. Here’s how:
Employees: Companies that become Public Benefit Corporations (PBCs) or Certified B Corporations are legally committed to balancing profit with purpose. They often adopt fair wage practices, provide better benefits, support diverse and inclusive workplaces, and invest in employee development and well-being. This results in higher job satisfaction, reduced turnover, and a more engaged workforce. By focusing on social goals, these companies help employees feel more connected to their work and the company’s mission, which can also boost productivity and morale.
Community: B Corps and PBCs take an active role in supporting the communities where they operate. This includes initiatives like local hiring, purchasing from small and local suppliers, contributing to local causes, and often giving back through volunteer programs or financial support. These actions strengthen local economies, increase job opportunities, and foster a sense of community pride. Furthermore, they bring valuable resources into under-served communities, addressing local issues and providing meaningful support that contributes to a higher quality of life for residents.
Environment: Both Public Benefit Corporations and Certified B Corporations adhere to environmentally responsible practices, often aiming for carbon neutrality, sustainable sourcing, and waste reduction. They focus on minimizing their environmental footprint through renewable energy usage, ethical sourcing, and green manufacturing practices. This can include lowering emissions, reducing plastic and other waste, and conserving natural resources. By aligning their business models with environmental goals, these companies play an essential role in fighting climate change and promoting sustainability in New Jersey.
By incentivizing this transformation, New Jersey supports businesses that actively contribute to social and environmental well-being, promoting a sustainable economy that benefits everyone involved.
