It all started about five years ago when I had just become a new father and going through a period of 'climate anxiety'.
Climate anxiety is the feeling of panic when you realize the true implications of climate change and you feel like there is absolutely nothing you can do to stop it, no matter how hard you try.
I am probably not the only person to become a father and start thinking more seriously about the future, but rather than being excited for my new daughter's life to come, I was worried. I felt alone. After some panicking I resolved to get properly educated and see if I could do something about it.
I wanted to find other people who cared as much as I did to turn the course of our future...no matter how awkward it became when I'd bring up climate change at a baby shower or some other social gathering, I just kept talking about it.
If you ask enough questions, you will find answers. What I found turned into a lot more than I expected.
WHAT I DIDN'T KNOW
I was the Director of Operations and Sustainability for Grace Farms Foundation when someone first told me about Certified B Corporations. It was explained simply that, "a B Corp is a business that 'does good' in the world, you know, like Patagonia."
Of course, I knew about Patagonia, its founder Yvonne Chouinard, and that it was one of the most responsible companies out there, but I didn't know that they could actually be 'certified for doing good'.
It was around this same time that I'd also just heard about the United Nations' Sustainable Development Goals, seventeen goals that 193 countries agreed to which are the blueprint for a more sustainable future. I began to understand that sustainable development was much more than just climate change and the interconnectedness of social and environmental priorities.
I knew relatively very little about B Corps or the Sustainable Development Goals, but my anxiety had met its antidote: there was a global community of people who cared as much as I did. I was determined to join the community and do my part.
You can imagine how delighted I was to find that my part-time MBA program at NYU offered a class called Social Entrepreneurship and Sustainable Development. (Taught by the amazing Susan Davis who would go on to become my mentor and friend.)
One of the readings for the class was the actual B Corp Handbook, a guide published by B Lab, the not-for-profit organization that created the B Corp Certification.
The Handbook lays out the argument that business can be a solution to the world's problems by being 'force for good'. The creators of the certification, Bart Houlahan, Andrew Kassoy and Jay Coen Gilbert, created criteria across a number of categories by which a business could be evaluated on what is now called 'Corporate Social Responsibility' or 'CSR'.
The B Lab created the Business Impact Assessment (BIA) which is an extensive questionnaire across the categories of: Governance, Workers, Community, Environment, and Customers. Based on the answers provided, points can be earned on a scale of 0 - 200. B Corp certification requires a minimum score of 80. The median score for all companies that complete the assessment is only 51 points.
It was during that semester when I first stumbled upon a recent change in the IRS code called 'The Philanthropic Enterprise Act' also known as the 'Newman's Own Exception'. The small, but very consequential change to IRS code 4943(g) stated that not-for-profit foundations could now own 100% of for-profit-companies. This change was a result of Newman's Own, the famous food CPG company that is owned by Newman's Own Foundation following the death of the company's namesake and founder, Paul Newman.
I wasn't sure what exactly this change would mean for business, but I knew it was going to important.
WHAT WE DID
I started sharing everything I was learning with Sharon Prince, Grace Farms Foundation's Founder and CEO. Sharon is one of those rare leaders who is willing to hear even the craziest ideas and even if there isn't a clear way to get there she is willing to go on the ride.
I suggested that Grace Farms create a new coffee and tea company that could be 100% owned by the Foundation, taking advantage of the new change to the IRS code. However, we wouldn't just create any coffee and tea company, we would create what the IRS calls a 'functionally related business', a company that actually furthers the charitable purposes of the business through its business model.
By this time the pandemic was beginning and we decided we would create a new company called Grace Farms Foods, LLC with three goals:
1. Share the experience of Grace Farms through Grace Farms' signature coffees and teas
2. Demonstrate and educate about ethical and sustainable supply chains
3. Give back 100% of profits to support Design For FREEDOM™ by Grace Farms
From the beginning we knew that the business needed to become a Certified B Corp™, so we created the company as a Public Benefit LLC, one of the legal requirements to become certified.
While we were designing the initial products, setting up our operations, and figuring out how to talk about Grace Farms as a coffee and tea brand, we partnered with a small women-led consulting group based in nearby Westport, CT called Impact Growth Partners. The team specializes in guiding companies pursue B Corp certification by helping complete the Business Impact Assessment, document its policies, and work with the B Lab review team.
Rebecca Coffey became my partner in helping me shape what kind of company we would be. She shared resources with me and in particular a book called Better Business by Christopher Marquis which details the history and potential positive implications of the B Corp movement.
As a new small business, we could create the policies of the company however we wanted, so we figured we would just align them with the BIA whenever possible.
After completing the BIA we were classified as B Corp Pending, a status given to first year companies that intend to become certified after a full year of business. This period gave us time to document all the steps we were taking that aligned with the BIA like a supplier tracking sheet, our supplier code of conduct, and even an employee satisfaction survey for a small two person team.
Frank Kwei, Grace Farms' resident tea master, created new tea blends and we worked with our importers to source the finest ethically sourced ingredients.
We worked to cement our partnership with Fairtrade America to become the first US-based tea company to source Fairtrade audited, traded, and certified ingredients.
We travelled to India to visit the organic tea gardens where we source our black teas from and have lunch with the tea pickers and factory workers.
We climbed the mountains of Colombia to meet the female farmers we source our coffee from and tour their small, biodynamic farms.
We shared our tea and coffee and more importantly we began to share our story.
B CORP CERTIFICATION
We began our formal review starting in August of this year (2022). We were assigned an incredibly smart and thorough account manager who carefully reviewed all our documentation and interviewed us.
We worked through questions together to better understand the intention and how points were qualified. We found some areas where we didn't qualify for points, but also found others where we earned points back.
Our final score was a 102.2 out of 200 possible points. Far exceeding the minimum threshold of 80 points and our goal of 100 points.
Our company profile is now available for public view on B Lab's website for the whole world to see.
We have been beyond delighted to become part of the B Corp community and found fellow B Corps to be very open and supportive already. Furthermore, B Lab has developed a strong relationship with Fairtrade and has a tool called the SDG Action Manager which helps businesses track their progress and contributions toward the Sustainable Development Goals.
CONCLUSION AND WHAT'S NEXT
B Corp recertification takes place every three years. Where we will be then, I don't really know, but I do know that thanks to the B Corp certification process we are in a more resilient position to accomplish our mission despite the headwinds that face any small business in highly competitive categories like coffee and tea. We have the support of getting to be at the table with fellow brands like Greyston Bakery, Allbirds, and of course, Patagonia.
We were even more delighted to see that Patagonia too, has now become a 100% not-for-profit owned company. A tip of our hat to you, Mr. Chouinard. Well done.
We are excited to share even more with the Grace Farms community that now stretches from Connecticut to California with every delicious sip and drip. We invite you to fill up your cup and join us on the next chapter of this exciting adventure in 2023.
About the Author
Adam Thatcher is the Co-Founder and CEO of Grace Farms Foods. Prior to this role, Adam served as the Director of Operations and Sustainability for Grace Farms Foundation and the Director of Food and Beverage for two major ski resorts in Lake Tahoe, California. Adam lives in New Canaan, CT and is a passionate skier, traveller, husband, and father of two children and two miniature sheep. He loves connecting with people, helping out, and sharing. Adam can be reached at firstname.lastname@example.org.