Triple bottom line

Topics: Sustainability, Tourism, Triple bottom line Pages: 6 (1817 words) Published: January 12, 2014
Ecotourism and Sustainable Development: a Triple Bottom Line approach to business

The concept of Triple Bottom Line (TBL), as John Elkington coined it in 1995, refers to the idea that companies and organizations should extend their agenda beyond the goals of economic prosperity by taking a three-dimensional approach to business, adding social justice and environmental quality as new goals on their agenda towards ‘sustainable capitalism’. Encouraging concern about sustainability is, according to Elkington, absolutely necessary if we are to survive on the planet: “to refuse the challenge implied by the TBL is to risk extinction”. (Elkington, 1999:139) The TBL model is used to measure the impact that the three bottom lines – economic, social and environmental – have within a certain business or industry sector against which it is applied. TBL is closely linked with the concept of corporate social responsibility (CSR) whose goal is to enhance sustainable growth by developing new business practices. In describing the TBL model as a way/strategy to lower the (negative) impacts of business activities on the community and the environment by rising awareness, Elkington emphasized the importance of asking new questions that do not concern only financial aspects, rather they are a combination of ‘corporate governance’, social responsibility and sustainable development: “What is business for? Who should have a say in how companies are run? What is the appropriate balance between shareholders and other stakeholders? And what balance should be struck at the level of the triple bottom line?” (Elkington, 2006:524) For Elkington, the transition towards sustainable capitalism depends on seven ‘revolutions’ as follows: markets, values, transparency, life-cycle technology, partnerships, time perspective and corporate governance. The author describes this transition as “one of the most complex our species has ever had to negotiate”. (Elkington, 1999:140)

But what is the role of TBL in this process? Some critics have argues that TBL has become just “a mechanism for accounting and reporting” (Vanclay, 2009:27) rather than a tool for impact assessment or for encouraging sustainability concern. This essay will analyse to what extent has assessing business performance against the ‘triple bottom line’ model influenced the activities of businesses in the tourism industry looking at impacts in the three bottom lines: economic, social and environmental.

First, an understanding of the strategy of TBL is needed. Businesses implement TBL to measure performance outcomes from an economic, social and environmental angle in order to determine the impact that business activities have in each area. By measuring the performance outcomes, firms can then follow innovative sustainability practices that would allow them to improve the triple bottom line. In other words, TBL brings in a new strategy for firms expanding its focus on sustainable practices in the tourism industry by measuring their success not only based on the profit they make, but also checking the impacts on the community(social indicators) and on the environment.

Traditionally, the tourism industry has been prised for the substantial economic benefits that it generates especially for the host countries. For example, many developing and poor countries have been able to improve their economy by promoting tourism in areas where few other business activities were possible. The World Tourism Organization put the (international) tourism industry first on the export earner list in 2010, ahead of petroleum, automotive products and food. In 2013, according to a report by the World Travel & Tourism Council (WTTC) who has conducted research on the economic impact that Travel & Tourism industry has had on GDP and jobs in 184 countries, showed that the contribution of Travel & Tourism to GDP has grown for the third consecutive year in 2012 creating more than 4 million new jobs, with the...
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