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- B Corp movement growing as more companies aware of ESG responsibilities but still not many in Aussie finance sector
- MoneyMe achieved B Corp certification in August, changing its constitution to reflect commitment to positive impact
- In 2014 Australian Ethical Investment became Australia’s first publicly listed company to gain B Corp certification
The global B Corp movement is growing as more companies become aware of their Environmental, Social and Governance (ESG) responsibilities and customers increasingly seek out purpose-driven businesses.
B Corp certification is granted to companies that uphold the highest standards of responsibility concerning their environmental and societal impact.
The movement was initiated in the US in 2006 by three friends who aspired to harness the power of business for the greater good.
The “B” symbolises “beneficial,” signifying that certified organisations willingly adhere to specific criteria encompassing the ‘triple bottom line’ – social, environmental, and financial aspects.
Presently, there are ~6000 B Corp accredited businesses operating worldwide.
Attaining and sustaining a B Corp certification involves a rigorous process, necessitating active participation from various departments within a company.
In Australia and NZ, more than 450 companies are Certified B Corporations, representing industries from waste management to accounting.
Based in Perth, Moodle is a platform for online learning that enables educators to create online courses, add assignments, and keep an eye on a student’s progress.
However, trailing behind in B Corp Certification are Australian finance providers. According to B-Lab just 13 have the coveted credentials. These two are on the ASX.
MME Applied for B Corp Certification in August 2022, and achieved it in August 2023. MME says it adopted the B Corp framework, to ensure that it allocates time and resources to sustainability initiatives that genuinely generate value and prevents any deceptive or insincere sustainability claims (greenwashing).
The company says this is achieved through the framework’s demands for external validation and transparent public reporting.
MME managing director and CEO Clayton Howes says in November last year the company changed its constitution to reflect its commitment to positive impact.
“Our environmental and social impact is no longer a second thought, or a nice to have, for our business. It’s a requirement,” Howes says.
“The overwhelming support we received from our shareholders to do this gave us confidence in the importance of driving change from the top.”
Howes says achieving B Corp Certification is a critical element of its wholehearted commitment to society and the environment.
“Our hope is that, through leading by example, we will inspire others in our industry to join the movement and prioritise sustainability and positive impact,” he says.
Commenting on MME’s certification, B Lab Australia & Aotearoa New Zealand CEO Andrew Davies says achieving its high standards for environmental and social performance, transparency and accountability is challenging for any business.
“For a publicly listed enterprise like MONEYME, an added layer of complexity comes in gaining shareholder endorsement of our requirement to embed a purpose and stakeholder governance approach in the company’s constitution,” Davies says.
This foundational change protects the company’s mission for the long term, and creates powerful alignment of shareholders, directors, founders and management.
LFG operates throughout both Australia and New Zealand. According to its B Corp page, the company strongly believes that fostering financial inclusion plays a pivotal role in nurturing thriving and cohesive communities. Since its inception in 1997, LFG says its has maintained a commitment to responsible lending, serving individuals and small businesses across a diverse spectrum of backgrounds and industries with a clear sense of purpose.
The company emphasises its comprehensive evaluation of a customer’s ability to repay loans and offers an array of loan options covering homes, cars, businesses, and personal financial needs, alongside consumer credit and general insurance solutions.
LFG says a fundamental principle underlying every loan or insurance policy is that it should provide tangible benefits to the customer; and for unexpected life challenges, the company has an in-house support team dedicated to providing assistance.
While not a lender, in 2014 the superannuation and managed funds provider, became the first publicly listed company in Australia to gain B Corp certification.
AEF says its fundamental commitment revolves around investing in a way that not only ensures financial security for their clients but also brings about positive societal and environmental change.
The cornerstone of their investment approach is their Ethical Charter, which acts as a guiding compass, dictating what they actively seek to support and what they conscientiously steer clear of investing in, with their portfolio aligning closely with prevailing global trends and emerging growth sectors, such as addressing the pressing issue of climate change.
AEF strategically invests in areas like renewable energy and energy efficiency, groundbreaking advancements in healthcare, the expansion of global connectivity through innovative technology, and sustainable solutions.
The company says it diligently avoids investments that have a detrimental impact on people, animals, or the environment and recently reported that funds under management (FUM) grew 48% YOY in FY23 to reach $9.2 billion, while customer numbers also increased 54% YOY.
Chief strategy and innovation officer Marion Enander told Stockhead AEF’s high certified B Corporation score reflects its commitment to operating all areas of the business ethically, transparently and with consideration of all stakeholders.
“The purpose of B Lab’s certified B Corporation aligns with our ethical charter to do right by people, animals and the planet, which has been the driving force behind all business decisions, and most importantly how we invest our members’ and investors’ money, since Australian Ethical was founded in 1986,” she says.
The MME, LFG, AEF share price today:
Among finance providers not listed on the ASX include:
Member-owned BankVic was established in 1974 to service Victorian police members. Formerly the Police Credit Co-operative, BankVic was renamed in 2013.
Over the years it has expanded its membership to emergency services and in 2020 gained its B Corp certification.
According to its B Corp page BankVic exists to strengthen the communities which it serves and to build healthy communities that are financially, socially and environmentally sustainable.
Social Enterprise Finance Australia (Sefa) was established in 2011 when it was chosen by the Australian Government to receive a $10 million grant from the Social Enterprise Development and Investment Fund (SEDIF).
The funding was supplemented by an additional $10 million obtained from equity investors and lenders.
In 2016, Sefa expanded its impact by establishing Sefa Partnerships as a public benevolent institution to enhance financial resources available to social enterprises dedicated to assisting disadvantaged communities throughout Australia.
According to its website Sefa offers direct lending, co-investment, blended deals and advisory services to under-resourced sectors including not for profits and other enterprises with social, cultural or environmental objectives.
Sefa achieved its B Corp certification in 2015.
At Stockhead we tell it like it is. While MoneyMe is a Stockhead advertiser, it did not sponsor this article.