The Impact of B Corp Certification on Growth
We empirically test whether B Corp certification affects the short- and medium-term growth rates of sustainable enterprises. These businesses are growing in popularity and prevalence but, due to their hybrid nature, often suffer from external credibility issues and competing internal logics. Because...
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doaj-a77c45eadbda4b91b3207025293da5052021-07-15T15:46:56ZengMDPI AGSustainability2071-10502021-06-01137191719110.3390/su13137191The Impact of B Corp Certification on GrowthValerie Paelman0Philippe Van Cauwenberge1Heidi Vander Bauwhede2Department of Accounting, Corporate Finance and Taxation, Ghent University, 9000 Ghent, BelgiumDepartment of Accounting, Corporate Finance and Taxation, Ghent University, 9000 Ghent, BelgiumDepartment of Accounting, Corporate Finance and Taxation, Ghent University, 9000 Ghent, BelgiumWe empirically test whether B Corp certification affects the short- and medium-term growth rates of sustainable enterprises. These businesses are growing in popularity and prevalence but, due to their hybrid nature, often suffer from external credibility issues and competing internal logics. Because of the rigorous and time-involving audit procedure, B Corp certification potentially sends a credible signal about the sustainable nature of the enterprise to its stakeholders. In addition, the B Corp label could help to straighten out internal tensions and align the company towards its dual purpose. Hence, B Corp certification could contribute to company success. We observe 129 firms that were certified between 2013 and 2018 over a period between six years prior and five years post-certification. Using propensity score matching, we identify 129 non-certified matching companies. On this sample, we conduct a difference-in-differences panel regression analysis to investigate the effect of certification. Our dataset allows us to study how the effects of B Corp certification evolve over time, which was previously untested. Our study documents a positive effect of B Corp certification on turnover growth and also that this effect increases with the time since certification, implying that certification requires some time for its full effect to become apparent.https://www.mdpi.com/2071-1050/13/13/7191hybrid enterprisessustainability certificationimpact measurementB Corp certificationsustainable enterprisesgrowth |
collection |
DOAJ |
language |
English |
format |
Article |
sources |
DOAJ |
author |
Valerie Paelman Philippe Van Cauwenberge Heidi Vander Bauwhede |
spellingShingle |
Valerie Paelman Philippe Van Cauwenberge Heidi Vander Bauwhede The Impact of B Corp Certification on Growth Sustainability hybrid enterprises sustainability certification impact measurement B Corp certification sustainable enterprises growth |
author_facet |
Valerie Paelman Philippe Van Cauwenberge Heidi Vander Bauwhede |
author_sort |
Valerie Paelman |
title |
The Impact of B Corp Certification on Growth |
title_short |
The Impact of B Corp Certification on Growth |
title_full |
The Impact of B Corp Certification on Growth |
title_fullStr |
The Impact of B Corp Certification on Growth |
title_full_unstemmed |
The Impact of B Corp Certification on Growth |
title_sort |
impact of b corp certification on growth |
publisher |
MDPI AG |
series |
Sustainability |
issn |
2071-1050 |
publishDate |
2021-06-01 |
description |
We empirically test whether B Corp certification affects the short- and medium-term growth rates of sustainable enterprises. These businesses are growing in popularity and prevalence but, due to their hybrid nature, often suffer from external credibility issues and competing internal logics. Because of the rigorous and time-involving audit procedure, B Corp certification potentially sends a credible signal about the sustainable nature of the enterprise to its stakeholders. In addition, the B Corp label could help to straighten out internal tensions and align the company towards its dual purpose. Hence, B Corp certification could contribute to company success. We observe 129 firms that were certified between 2013 and 2018 over a period between six years prior and five years post-certification. Using propensity score matching, we identify 129 non-certified matching companies. On this sample, we conduct a difference-in-differences panel regression analysis to investigate the effect of certification. Our dataset allows us to study how the effects of B Corp certification evolve over time, which was previously untested. Our study documents a positive effect of B Corp certification on turnover growth and also that this effect increases with the time since certification, implying that certification requires some time for its full effect to become apparent. |
topic |
hybrid enterprises sustainability certification impact measurement B Corp certification sustainable enterprises growth |
url |
https://www.mdpi.com/2071-1050/13/13/7191 |
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