February 24, 2013
Triple Bottom Line
The article Sustainability: It Should Be About More Than the Bottom Line on Forbes.com discusses the topic of the triple bottom line. The article discusses the idea that being ecologically friendly can be conducive to a strong financial bottom line, as well as a social and environmental one. The main point of the article is that if all organizations followed the principles of the triple bottom line, it would lead to a higher quality of life for all, with less government interventions into the way business is done.
The first words in the article are “Going green can be profitable”, and this is an important thing to remember. Being socially conscious and environmentally friendly can positively impact the bottom line of an organization. This has mistakenly led some organizations to decide that the most effective way to contribute to society and the earth is to create a focus on how to reduce costs and increase profits environmentally.
An approach that is much more encompassing of the true meaning of the triple bottom line is rather than having a profit first mentality, having a sustainably effective approach that truly focuses on the needs of the people, the planet and also profit. The organizations that are taking this to heart are not strictly looking into profit. They integrate sustainability into the heart of their company and go from there. They are measured by all three areas; not simply profit.
The organizations that are truly putting into practice the triple bottom line are not considering the environmental initiatives as “special programs – as mere window dressing”; they realize these approaches are not enough. They are making much more intensive entire organizational changes. Sustainble performance is a part of everything that the organization does. It comes into play in dealing with employee management as well as how work gets done. It is evident everywhere. Companies who have made this work realize that in order to continue to realize profits, we need to look at how the world will be in 50 years.
There are many organizations that have the profit mentality. Everything is done for that one main bottom line. They are looking for an immediate financial payoff in the decisions that they make. Things may look good from the outside, but their environmental commitments do not trickle through to the very being of the organization.
The hard thing to change from the financial bottom line to the triple bottom line is that leadership from the top down need to buy in to the idea. The entire way of managing needs to change. In the beginning, it may not result in things being run the most profitably.
One of the reasons that this approach should be adopted is that the more common place it is, the less the government will need to be involved with the decisions in the private sector or business.
In the course Marketing Principles, this very topic is discussed in Chapter 1. Not only can the triple bottom line be profitable, it can be considered to be a competitive advantage in today’s marketplace.
I believe that the author’s perspective is right on. The organizations really need to focus their change on all three important segments. Our world is not full of infinite resources, and we need to take responsibility for ensuring it lasts. Society is becoming more aware of this, and it is playing an important part in the decisions we make every day. I believe that corporations who do not embrace this concept wholeheartedly will suffer financially because of it. Organizations which are not currently following the idea of a triple bottom line really need to consider the implications of such a decision. The world is changing, and organizations need to change along with it. Gone are the days that all we have to worry about is the bottom line. Organizations who do not come on board will find themselves lacking in the one area they so...