Riding the New Economy’s Ethical Wave

What would the world look like if capitalism wasn’t just all about the bottom line?

A whole lot more hopeful, say a growing number of business owners across the United States, and, to prove their point, they’re turning their companies into “for benefit corporations.” The designation — which requires a simple rewriting of a company’s articles of incorporation and is now recognized by 17 states, including California and, most recently Delaware, home to many large corporations — establishes a public benefit purpose for a business, thereby preserving the founders’ value-driven intentions by protecting the board of directors from being sued by a company’s shareholders for not just maximizing profits. Additionally, most of those companies are also submitting themselves to a thorough vetting by the B Lab, a third-party entity that issues the “B Corp” certification for companies that follow “rigorous standards of social and environmental performance, accountability, and transparency.”

Only six Santa Barbara companies have taken the plunge so far, but Garrett Kababik of Channel Islands Outfitters — which reincorporated as “for benefit” in 2012 with the express intent to “save the oceans and natural places” — is already waving the flag sky-high. He fears that money-grubbing companies are the biggest threat to the world, comparing them to the world-destroying robots that humans created in the movie The Terminator. “We’ve done that, but we haven’t done it with machines — we’ve done it with corporations,” said Kababik. “There’s no humanity behind corporations. It’s like creating a machine to do all your dirty work.”