This is a recurring series of excerpts from the book “The B Corp Handbook: How to Use Business as a Force for Good“ (Berrett-Koehler Publishers, October 2014). Click here to read the rest of the excerpts.
By Ryan Honeyman
Certified B Corporations are leading a global movement to redefine success in business.
As a community of thought-leading businesses, one of the best ways that the B Corp movement can continue to drive positive change is to address the controversial issue of executive pay.
For example, in 2013 the average pay ratio of a Fortune 500 CEO compared to the average salary of their employees was 331:1. Some employers have started to implement a cap on the ratio between the highest and lowest earners in their company.
Namaste Solar, a B Corp based in Boulder, Colorado, caps the ratio of its highest salary to its lowest salary at 3:1. Whole Foods Market, a publicly-traded member of the Fortune 500, caps its highest salary at 19 times the average employee pay. Certified B Corps that implement this practice typically cap their pay ratio between 5:1 and 10:1.Click to continue reading »