Legal requirement for companies incorporated in Australia & New Zealand
B Lab Australia & New Zealand does not require Australian or New Zealand companies to change their company’s constitution and other documents as a condition to B Corporation certification.
Australian and New Zealand B Corporations are required to sign a terms sheet to contract with B Lab Australia & New Zealand, as per the following:
- 1. to the extent permissible under Australian law, to consider the impact of its decisions not only on shareholders, but also on its employees, customers, suppliers, the community, and the environment;
- 2. to use reasonable endeavours to support B Lab’s efforts to determine an effective legal mechanism to promote directors' consideration of the matters in item 1;
- 3. in the event that such a legal mechanism is established in Australia, take such steps as are necessary to avail itself of such mechanism; and
- 4. in the event of a change of control of it, including a public offering, it will recertify within 90 days of the effective date of the change of control.
B Lab Australia & New Zealand has received advice that in order to include the requirement for B Corporations to change their constitution as part of the certification, wider legislative amendment would be required to clarify the duties of, and provide greater comfort to, directors of Australian B Corps.
B Lab Australia & New Zealand is currently developing model legislation which seeks to achieve these outcomes.