As The Body Shop stands to lose its B Corp status, Retail Week looks at whether the certification makes any difference to commercial success
When The Body Shop was founded in the 1970s, it laid the path on which many ethical and sustainable brands walk today.
Following decades of activism, the chain was awarded its B Corp certification in 2019, which cemented its reputation as a trailblazer in sustainable beauty.
It became one of the largest global B Corp companies and the largest B Corp beauty chain outside Latin America.
Now, just five months after being bought by private equity firm Aurelius, the beauty chain in administration stands to lose the stamp of approval that helped it stand out among a sea of brands.
But as a brand at sea itself, will losing the accolade make a difference? Retail Week speaks to a Body Shop insider to find out if the certification impacted its commercial success, and what it stands to lose if it finds itself outside the B club.
Does a B Corp billing help pay the bills?
In the four years from 2017 to 2020, UK B Corps saw an average turnover growth of 26% compared with the national average of 5%, research by B Lab UK revealed.
But a source with inside knowledge of The Body Shop says there was no commercial difference to the chain’s performance when it was awarded B Corp status in 2019, adding that a vast majority of consumers choose to buy products for their quality, with being B Corp-certified an added bonus.
The source says: “It’s the whole problem of why are consumers choosing to buy products? Are they buying them because they’re ethical and because they’re low environmental impact? Or are they buying them because they’re good products?
“The fact is that the vast majority of people are buying them because they are good products. And they just want reassurance that they’re not doing the wrong thing, that they’re not buying a product from a company that’s abusive in some way. They just see a badge but don’t really know what the badge means.
“There are a very small number of people who will recognise the logo and be curious about what it represents. But the vast majority don’t.
“So I think, in terms of commercial value, there’s a job that has to be done by B Lab in explaining how companies that are B Corp are better than non-B Corp companies. I don’t think that message is getting through.”
What is a B Corp?
The UK has 2,000 certified B Corps, ranging from fashion retailers such as Fat Face to global news organisations like The Guardian, making it home to nearly a quarter of the world’s 8,400.
In simple terms, it’s a measure of sustainability. B Corp certification signifies that a business is meeting high standards of performance, accountability and transparency across the business. These include aspects such as employee benefits, corporate governance, charitable giving and supply chain practices.
With global events such as COP engaging countries to set environmental standards and address climate change issues, there has been a growing conversation about how businesses can do their part for the planet.
B Corp certification helps businesses move in that direction. A spokesperson for B Lab UK, which assesses companies seeking B Corp status in this country, told Retail Week: “The social and environmental challenges we’re facing are urgent, and the UK public expect more from the brands they shop from and the organisations they work for. And so more and more companies are looking to B Corp certification.”
All businesses seeking to become a B Corp must complete an impact assessment, which challenges businesses to look at every aspect of their operations and evidence how they consider people and the planet alongside profit.
The spokesperson added that ”every single business that becomes a B Corp changes their legal articles — also known as their corporate governance — so that this decision making and expanded duty of care is locked in for the future”.
The Body Shop’s future
The B Corp review is an added difficulty for The Body Shop, whose fall into administration and subsequent store closures and redundancies have already sparked many controversies.
Will the loss of its ethical badge lessen the struggling retailer’s chances of getting saved from administration?
The source says it is hard to say if that alone will reduce its chances of being rescued, but it does raise questions about The Body Shop’s future.
“That’s a company that holds itself to the highest standards,” they say. “And it’s not achieving those standards any more. That’s really a shame for the business.
“And it does make you question what its future will be. Because if it differentiates on social and environmental justice and it’s no longer considered to be among the best companies in that area, then really what’s the point of The Body Shop? That’s the big question.”
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