The Triple Bottom Line
Business sustainability is ‘captured’ in the concept known as the Triple Bottom Line where – in addition to financial profitability – a business is also accountable for its social and environmental bottom lines.
The basic premise is that a businesses’ costs are not just financial. In this scenario, profits (and losses) should not be counted in just dollars. The true costs for any business include natural costs (pollution and environmental damage; loss of biodiversity and natural habitats; climate change; etc) and social costs (unemployment; decline of the regions; lifestyle diseases and mental health) as well as financial costs.
The important thing to remember is that any bottom line is simply the result of decisions and actions that are made throughout the process of doing what a business does. As William McDonough implies the bottom line is totally reliant on the questions that are asked at the top.
Some would argue that the profit motive will always trump the motive for sustainability, yet nothing could be further from the truth, depending on what your business does.*
In a business sense the key messages of sustainability actually tie in with what are considered to be ‘sound’ business practices – being efficient, minimising waste and maximising resources.
Read more about sustainability and the financial bottom line »
Social sustainability is focused on the development of programs and processes that promote social interaction and cultural enrichment. It emphasises protecting the vulnerable, respecting social diversity and ensuring that we all put priority on the health of our societies.
Social sustainability is related to how we make choices that affect other humans in our global community. It covers the broadest aspects of business operations and the effect that they have on employees, suppliers, investors, local and global communities and customers. Social sustainability is also related to more basic needs of happiness, safety, freedom, dignity and self-esteem.
Read more about sustainability and the social bottom line »
Environmental issues are the elements of sustainability that are most commonly addressed by society and industry today.
Natural resources are no longer abundant. We are depleting them at a more rapid rate than they can be replaced in nature. Man-made materials and their waste streams are polluting the Earth and compromising the survival and diversity of many plant and animal species. We are compromising humankind as a species through harmful emissions (water impurities, air pollution), and we are compromising the Earth’s ability to regenerate natural resources. We are compromising the ability to meet our own needs and those of future generations.
Read more about sustainability and the environmental bottom line »
* Some businesses can never be sustainable because what they do can never be sustainable. As stated elsewhere the sustainability of a business is predicated on two factors:
- What the business does
- How the business does it
If a business produces unsustainable products e.g. oil, coal, cigarettes, arms, etc. it can never be sustainable no matter how efficiently they do it. As the saying goes being less bad, is still bad.