Hi. I’m in … Delaware.
Seriously, I am actually in Wilmington, Delaware. How in the world did I end up here?
Well, I have sealed amendments in hand that show that Ian Martin Inc. (our US Corporation) has legally become Ian Martin PBC (Public Benefit Corp). But this journey didn’t start today – let me magically whisk you away to the beginning…
December 2010, Toronto, ON
Shortly after I took this gig as Chief Steward/CEO at the Ian Martin Group, a senior VP at one of our global competitors booked a meeting with me. His pitch? “Our company wants to make a move into the Canadian market. The Ian Martin Group is our top acquisition target. Oh, and just FYI, the CEO at the last company we bought moved to Florida and lives on a yacht.”
That was my 3rd week on the job.
It really made me think – not about the yacht – but about exactly what I would do with this rare opportunity for someone my age to lead a company…
My grandmother, Mary Masson, founded this company and pioneered an industry (Engineering Staffing) with her business partner, Ian, 56 years ago. In 1986, my parents bought the company. They grew the business from 10M to over 100M during their 25 years at the helm. Although business growth was certainly a focus for them, my mom & dad were quietly motivated by the work they could do through their Foundation because they owned a business. Now I was faced with the question: Could I commit 25 years to this enterprise? If so, what would I focus on and achieve in that time?
Like my parents, I knew that what was most important to me was that the work of their Foundation continue. And yet, speaking with the SVP of this global competitor, I suddenly realized that we could sell the business and simply invest the capital in the Foundation to accomplish this goal.
I was struck by that thought – not the good that would come of it but what a loss it would be for the other stakeholders in our business – our clients, candidates, and especially our employees.
A Foundation alone – disconnected from the business – would be just a pile of money generating small annual returns to give away. It would fundamentally lack the agency, human relationships and potential for growth represented by a commercial operation.
That was the moment I realized just how much potential business-itself has to be a force for good in the world.
But what to do about that seed of an idea? Send out a tweet and hope to find like minds? Start a blog? Google it? Yes, google it… that sounded easy.
That’s when I found http://www.bcorporation.net. Not only had these guys reached the same conclusions about business, they were actually changing laws to implement their vision. I dug further and watched Jay Coen Gilbert’s TED talk, “The Evolution of Capitalism.” I clicked the Impact Assessment online and filled it out – another surprise, we qualified. We decided to join the movement.
July 31, 2013, New York, NY
I’m in the boardroom of CFO magazine with the Editor-in-chief, David M. Katz, and CEOs of 3 other B Corps – Plum Organics, New Leaf Paper & Alter Eco (later we were joined by Method Home). We are here to talk about why each of our companies will be adopting the legal Benefit Corporation form in Delaware when it becomes law the following day.
Katz starts the meeting with a kind but skeptical tone, “While I may be personally interested in the sustainability story, I have yet to find an angle to present it to my readership where it makes hard business sense. My readers are CFOs. Tell me your stories but make it clear how being a B Corp has made a difference to your bottom line?”
We all agree that the expression of “good business” as measured in the Impact Assessment is core to protecting the mandate and values of our businesses. As Katz listens to the stories, he opens up. Impressed, he seems to have finally found his angle. For example:
- Plum Organics, founded in 2007, has grown to over $100M in just 5 years selling baby food that gives kids, “the very best food from the very first bite.” Campbell’s Soup Company, who recently acquired them, has blessed their conversion to a legal Public Benefit Corp (PBC) in Delaware.
- New Leaf Paper, founded in 1998, has led a fundamental shift toward environmental responsibility in the paper industry – growing the business while saving 2.5M fully grown trees.
- Alter Eco, founded in 1998, “sources healthy and delicious, organic, fair trade ingredients from small-scale farmers around the world.”
- Method Home, founded in 2000, has grown to over $200M selling, “beautifully packaged, environmentally friendly cleaning products and soaps.” Along the way, they have transformed their industry.
For me, as I listen, I am inspired to see how the vision of “business as a force for good” is taking shape in actions of these entrepreneurs. It is hard to imagine a Foundation having this kind of scalable impact.
When it’s my turn to speak, I note that at Ian Martin, our story is a little different. We are not a high-growth startup – we’ve been around for a long time and our business over the last 10 years has been relatively stable. But we’ve started to put “mission” at the core of our business – leading the way for other established companies. No, it’s not a straight line – but we’re starting to do a few things and see some results that I hope will encourage others that this is a path worth following.
Aug 1, 2013, Wilmington, DE
Obviously unbeknownst (or irrelevant) to Wayne and Garth, “More than 50% of all U.S. publicly traded companies and 63% of the Fortune 500 are incorporated in Delaware.” (Wikipedia). “Delaware has a more well-developed body of case law than other states, which serves to give corporations and their counsel greater guidance on matters of corporate governance and transaction liability issues.” (Wikipedia)
As I walked around downtown Wilmington, Delaware, I barely spotted a business that wasn’t a law firm. Clearly “Corporate Governance” is pretty much their only industry. That’s why the fact that Delaware has adopted Public Benefit Corp (PBC) legislation is such a big deal. They do not take this stuff lightly.
— Tim Masson (@Tim_Masson) August 1, 2013
At the ceremony hosted by Gov. Jack Markell and Secretary of State, Jeffery Bullock, 17 companies were registered at 8am on Aug 1, 2013 as the inaugural Public Benefit Corporations in the state. There seemed to be a sense of joy and excitement on the part of the politicians and lawmakers in the room. It was as if seeing the faces of these business leaders caused them to realize the importance and potential impact of the legislation they had passed.
Gov. Jack Merkell conveyed a great sense of warmth as he asked each of the companies to introduce themselves. In his brief (and often humorous) comments, he said, “The creation of Delaware public benefit corporations is a powerful, market-based solution to the systemic problem of short termism and an innovative approach to using market forces to solve our most challenging problems.”
For my part, I felt deeply privileged to be in Delaware on this historic day. As the Ian Martin Group moves into its 6th decade, I hope our company can remain faithful stewards of this vision – to show the way to a more just and prosperous economy for all.
I would like to invite Canadian Business Leaders to participate in this movement. Please read the Open Letter to Business Leaders published by the community of B Corps on this historic day and/or touch base with me to learn more. Simply taking the B Impact Assessment is a great first step to help your company “measure what matters”.