Did you know that the City of Philadelphia offers a credit up to $8,000 for sustainable businesses? And did you know that this tax credit is the result of SBN’s policy and advocacy work with our partners in local government?
Governing recently highlighted Philadelphia’s Sustainable Business Tax Credit in a January article titled “The Rise of the Do-Gooder Corporation” that highlighted SBN’s Executive Director Anna Shipp and SBN Members and B Corps Azavea and Pixel Parlor:
[Philadelphia] offers a tax credit of up to $8,000 for sustainable businesses — either those certified or those that can show they meet similar standards of social and environmental responsibility. Christine Knapp, director of Philadelphia’s Office of Sustainability, said the city launched the sustainable business tax credit in 2012 on a pilot basis, limiting it to 25 companies and capping the credit at $4,000. Growing demand led to the credit’s expansion in 2015, and while the current credit is capped at 75 businesses on a first-come, first-served basis, further expansions could come when the credit is reauthorized in 2022. “We want to recognize the businesses leading by example,” she says, “but also encourage other businesses to take some action.”
Andrew and Jenn Nicholas, husband-and-wife co-founders of the graphic design firm Pixel Parlor, say the credit has been a big help to their 10-person company. “It’s a challenge to be profitable and provide benefits to our employees,” says Jenn Nicholas. “Every tiny bit helps, and it feels like somebody is looking out for us when the general climate [for small businesses] is the opposite.”
At the much bigger Azavea, the credit has had a smaller bottom-line impact. Still, says Cheetham, “symbols matter. It’s a powerful symbol when you’re going to other businesses and trying to attract them into the city.”
For state and local governments, this business-led reform is well worth encouraging. Research has shown that benefit companies are a boon for workers and their communities and could encourage a much-needed shift in national corporate culture — away from the single-minded focus on shareholder profit. In short, benefit corporations are a refreshing countertrend that could ultimately prove more effective than prescriptive efforts to regulate corporate behavior. They prove, says Anna Shipp, executive director of Philadelphia’s Sustainable Business Network, that “an equitable society and a thriving economy are not mutually exclusive but interdependent.”
But some businesses, according to Shipp, may need a little encouragement to refocus their mission on doing good. Laws to recognize benefit corporations’ legal status is the first step, she says; following Philadelphia’s lead with a tax credit could be the next catalyst.
Click here to apply for Philadelphia’s Sustainable Business Tax Credit.