Substantive and Subjective: A Multi-Method Investigation of B Corp Certification on Customer Ratings

• In Event: Organizations, Occupations, and Work Section Roundtables
  In Refereed Roundtable (90 minute): Table 23: Audiences and Evaluation

Abstract

We examine how B Corp certification affects customer satisfaction with a multi-method approach combining archival analysis of a matched sample of 940 firms, a regression discontinuity design around the 80-point cutoff for B Corp certification, and controlled laboratory experiments. Our archival analysis demonstrates that certified B Corps achieve 16-22% higher customer ratings than conventional firms, with this relationship operating through enhanced employee satisfaction. Firms with stated social missions lacking formal certification (“B Corp-like”) show significantly weaker effects, highlighting the value of third-party verification and governance mechanisms. Critically, the employee satisfaction mechanism mediates 11.5% of total certification effects on customer ratings, revealing substantial unexplained variance. Complementary controlled experiments isolate subjective cognitive processes: participants rate identical products associated with certified B Corps significantly higher, particularly in contexts where ethical considerations are salient. Our study advances institutional theory by shifting the attention on the traditional substantive-symbolic dichotomy to substantive organizational improvements and subjective cognitive engagement, both of which produce measurable stakeholder benefits. Our findings also extend signaling theory by demonstrating that certification signals create value beyond reducing information asymmetry about organizational quality—the signals themselves directly influence stakeholder evaluations through cognitive processes even when actual product quality is held constant experimentally.

Authors

• Kunyuan Qiao, Northeastern University

• Wesley D. Sine, Cornell University

• Tejas Ramdas, Cornell University

• Mary Ross, Cornell University