This study explores the impact of B Corp certification and its associated impact assessment on four case studies of small and medium-sized Brazilian companies certified as B Corps. The results reveal that although all companies had achieved high scores in the certification assessment, awarded on the basis of existing performance, they did not subsequently develop road maps for the future to improve their scores in the way which the B Corp Impact Assessment process endorses as one of the benefits of (...) certification. Their incremental changes are discussed in the light of the main motivations and expectations of these companies’ founders with regard to the certification. A central role of the B Corp certification for this group of companies was to improve their external reputation with investors, clients and consumers. They were not strongly driven to reshape internal processes in ways which would advance their scores in the impact assessment and which would tackle complex problems of corporate governance. Our findings contribute to enriching the discussion of stakeholder engagement and corporate governance in hybrid organizations and contribute to the emerging agenda on studying change over time in B Corps. (shrink)

Ethical issues in non-financial auditing are increasingly under scrutiny and questions have been raised about the impartiality and independence of audits. Among many other problematic issues, firms have discretion to select their assurance providers and are also required to cover the cost of the audit. Previous literature highlighted several consequences of this competitive and client-driven environment. However, research has mainly focused on firm-level investigation of the consequences—in this paper, we enhance this research by also considering assurance providers. Our approach is (...) grounded in legitimacy and institutional perspectives and we study how organizational motives and selection of assurance providers impact the benefits arising from the audit. In particular, we assume that firms select their assurance providers on the basis of audit strictness (substantial auditing) and market credibility (symbolic auditing) and we study the operational and market benefits that arise from the audit. Based on the data collected from 597 firms, we demonstrate that internal motives drive firms to be more likely to select assurance providers that offer audit strictness, while external motives drive firms to be more likely to select assurance providers that offer market credibility. The findings further show that assurance providers associated with auditing strictness have a stronger effect on operational benefits compared to assurance providers that offer market credibility. We also find that firms’ motives alone are important in driving the benefits achieved. These findings provide a basis for exploring the ethical implications of non-financial auditing. (shrink)

Voluntary sustainability standards (VSS) aim to encourage ethical behaviors of organizations, yet studies show that many VSS adopters do not live up to these promises. Existing literature typically attributes the reason for this ineffectiveness to either policy–practice decoupling, owing to a lack of adhering to VSS requirements, or means–ends decoupling, owing to a lack of adapting to the local context. However, little is known about how the contradictory needs of adherence and adaptation evolve throughout VSS implementation. Building on the knowledge (...) transfer literature, we develop a dynamic conceptual framework that distinguishes two phases of VSS implementation. Specifically, we theorize how tensions emerge in the transition between phases since the first phase primarily calls for adherence, whereas the second calls for adaptation. Applying this framework, we develop propositions to illustrate how these tensions relate to different VSS characteristics: stringency, enforcement, and scope. The article concludes with implications and future research directions for VSS scholarship. (shrink)