Bachelor of General Studies (BGS) Degree Practice Exam

What is the term for a business model that aims to balance the interests of all stakeholders while addressing social and environmental issues?

1. B Corporation

2. Nonprofit Organization

3. Social Enterprise

4. Cooperative

The correct answer is: B Corporation

The term that refers to a business model specifically designed to balance the interests of all stakeholders, while also addressing social and environmental issues, is B Corporation. B Corporations, often referred to as Benefit Corporations, are a new kind of for-profit company that seeks to ensure that their operations benefit not just their shareholders, but also their employees, the community, and the environment. This model incorporates rigorous standards of social and environmental performance, accountability, and transparency. In contrast, other entities mentioned have different focuses. Nonprofit Organizations primarily aim to fulfill a mission for social good without the intent to generate profit for individuals or shareholders, while Cooperatives are owned and operated by a group of individuals for their mutual benefit, emphasizing member ownership rather than broader stakeholder interests. Social Enterprises do aim to address social issues but may not always have the structured accountability and certification that B Corporations are required to meet.