WBEC-West is a partner organization of the Women's Business Enterprise Nation Council (WBENC), which has established nationally-recognized Standards & Procedures for WBE certification. These include criteria for eligibility, recertification and the application process.
Understanding the Criteria
A condensed version for the criteria is provided here:
1. Ownership: The female owner(s) must own at least 51% of the business.
2. Contribution: The female owner(s) must be able to provide proof of contribution of capital and/or expertise.
3. Operation and control: Female owner(s) must provide proof of effective management of the business, i.e. operating position, bylaws, hire-fire and other decision making roles.
4. Independence: Female owner(s) must be able to provide evidence that she has the ability to perform in the area of specialty or expertise without the reliance on either the finances or resources of a male.
5. Citizenship: U.S. Citizenship or legal resident alien status.
The full Criteria for certification are available at the following Web page:
Understanding the Standards & Procedures
The full version of the Standards & Procedures is available from the following Web page: http://www.wbenc.org/
The following is a summary version of the WBENC Standards & Procedures:
At a minimum, the following standards will be used in determining whether a firm is an on-going business concern, owned and controlled by women, and therefore eligible to be certified as a Women Business Enterprise:
A. Size Standards
Determination of business size, will be made in accordance with 13 CFR Part 121.2 guidelines. (See Appendix B.).
B. Ownership
The ownership by women must be real, substantial and continuing going beyond the pro-forma ownership of the firm as reflected in its ownership documents. The applicant must share in all risk and profits commensurate with her ownership interest as demonstrated by a detailed examination of the substance of her business arrangements with others. All securities that constitute ownership of a firm shall be held directly by the woman or women.
No securities or assets held in trust are considered as held by women in determining the ownership of a firm.
There are two exceptions to this:
1. Corporation
In a corporate form of organization, women principal(s) must own at least fifty-one (51%) of all voting stock of the corporation. Any voting agreements among the shareholders must not dilute the beneficial ownership, the rights, or the influence of the women owners of the stock or classes of stock of the corporation. Women owners shall possess the right to all customary incidents of ownership (e.g., ability to transfer stock, title possession, enter binding agreements, etc.). Nonprofit corporations do not meet this requirement and are therefore not eligible for certification.
2. Partnerships
In a partnership, two or more persons agree to carry on a business or venture together, upon the terms of mutual participation in its profits and losses. It is, in effect, a contract of mutual agency, each partner acting as a principal in her/his own behalf and as agent of his/her co-partners, and general rules of law applicable to agents apply with equal force in determining rights and liabilities of partners.
C. Contribution of Expense and/or Capital
Contribution of capital and/or expertise by women owners to acquire their ownership interest shall be real and substantial and be in proportion to the interest(s) acquired. Insufficient contributions shall include, but shall not be limited to promises to contribute capital or expertise in the future, a note payable to the business or its owners who are not women, or the mere participation as an employee.
D. Governance
The organizational and governing documents of an applicant (e.g. Limited Liability Company Operating Agreements, Partnership Agreements, or Articles of Incorporation and By-laws) must not contain any provision, which restricts the ability of the woman(s) business owner from exercising Managerial Control and Operational Authority of the business.
E. Operation and Control
The women must possess the power to direct or cause the direction of the management and policies of the business and to make the day-to-day as well as major decisions on matters of management, policy and operations. The business must not be subject to any formal or informal restrictions that limit the customary discretion of the women owners.
F. Independence
The women owner(s) shall have the ability to perform in its area of specialty/expertise without substantial reliance upon finances and resources (e.g., equipment, automobiles, facilities, etc.) of males or non-women business enterprises.