Focusing on people, planet and profitsinstead of just profits alonecan lead to a number of potentially unexpected benefits. Triple bottom line concept one of the foundations of csr is the concept of the triple performance line triple bottom line 3bl, see figure 1, which results from the paradigm of sustainable development and is based on the search for balance between the three dimensions. Triple bottom line triple bottom line tbl reporting is a method used in business accounting to further expand stakeholders. While this paper will not be exhaustively comprehensive on the topic, it should still provide an. Corporate social responsibility, the triple bottom line. A triple bottom line to ensure corporate responsibility. Managing the triple bottom line for sustainability. Its closely related to the concept of corporate social responsibility, a term also related to a corporation seeking to add societal value. Jason burnham, partner and social engineer at burnham marketing calls these key principles the triple bottom line. As corporate social responsibility csr initiatives have become more and more popular, the attention of performance management has turned away from only financial and towards a more holistic approach. Csr and the sustainable tourism practices of marriott international. In developing and using a triple bottom line framework, the mdba took a transparent and balanced approach to assessing and setting sustainable diversion limits for the northern basin. We begin by asking just what it is that supporters of the triple bottom line idea advocate, and attempt to distil specific, assessable claims from the vague, diverse, and sometimes contradictory uses of the triple bottom line rhetoric.
Can the triple bottom line concept help organisations. Business writer john elkington claims to have coined the phrase in 1994. We argue on both conceptual and practical grounds that the triple bottom line is an unhelpful addition to current discussions of corporate social responsibility. Stenzel the terms sustainability and sustainable development are frequently used in the public arena today. Triple bottom line tbl is making inroads into public sector performance measurement partly because it is uncertain whether a it is a sound, transparent, and defensible model for transforming and managing public sector agencies. Elkingtons triple bottom line model encourages businesses to take a broader approach to business performance. He reflects on what got him to that point, what has happened since and where the agenda may now be headed.
Profit is the traditional measure of business success. The phrase the triple bottom line was first coined in 1994 by john elkington, the founder of a british consultancy called sustainability. Triple bottom line reporting takeaways 9integration triple bottom line triple bottom line 9relevance stakeholders stakeholders qualitative, quantitative and graphics qualitative, quantitative and graphics 9interconnectedness sustainability of natural, built, social and sustainability of natural, built, social and economic systems. The concept of the triple bottom line can be used regionally by communities to encourage economic development growth in a sustainable manner. The triple bottom line consists of social equity, economic, and environmental factors. In this context, the triple bottom line concept tbl require that companies. Heres how to develop strategies for csr that align with your organizations mission and deliver on the triple bottom line. This article discusses the meaning of sustainability, explores the development of the sustainability movement, and explains how businesses.
Why the triple bottom line is important imedia connection. Whole life accounting overcomes some of the limitations of annual accounting methods. The triple bottom line the term triple bottom line was coined by john elkington in 1994 in an attempt to create a new language to express what was perceived as an inevitable expansion of existing corporate models, from purely economic values to economic values as a part of managing sustainable conduct. Microfinance institutions mfis seeks to facilitate better living. A proposition for the future hasan fauzi 1, goran svensson 2 and azhar abdul rahman 3 1 faculty of economics, sebelas maret university, jl. Oct 10, 2017 the triple bottom line tbl framework is gaining popularity as more companies implement sustainable business strategies. Though the triple bottom line has been around for decades, events such as the 2008 financial crisis, the bp oil spill, and climate change cast an almost constant spotlight on corporate ethics and corporate social responsibility. Triple bottom line 5 another theory of corporate social responsibility is the triple bottom line. Basically, triple bottom line tbl reporting is meant to capture, describe and measure the impact of the organisations activities on the world. In todays business world, demonstrating concern for the environment has become a corporate imperative. Businesses are usually assumed to be profitmaximisers. The triple bottom line in businesses is used in order to create sustainability for businesses.
The model consisted of four domains, namely economical, social, ecological and cultural. Simons 5,6 defines corporate performance using an approach of market mechanism by which the company actively interacts with the financial, factor and customer product markets. The conceptual roots of tbl are embedded in a quantitative, economic paradigm. Many businesses and nonprofit organizations have adopted the tbl sustainability framework to evaluate their performance, and a similar approach has gained currency with governments at the federal, state and local levels. A triple bottom line report is an accounting of business performance in terms of its impacts on the economy, the environment and society. Apr 14, 2012 in attempting to combine the very different and often competing, imperatives of profitability, social justice and environmental protection, we show that the triple bottom line tbl approach is problematic, as seen in the reports. About 25 years ago, john elkington coined the term triple bottom line as a challenge for business leaders to rethink capitalism. The triple bottom line aims to measure the financial, social, and environmental performance of a company over time. The triple bottom line exists as a kind of balanced scorecard that captures in numbers and words the degree to which any company is or is not creating value for its shareholders and society.
The term csr report is often used instead of a triple bottom line report, but the two are interchangeable. Through the development of sustainabilityrelated objectives under these headings and matching each. From just being meant to refer to philanthropy, csr has come a long way to include the impact of companies activities on the environment, economy, society and all the stakeholders. Sustainability and triple bottom line reporting what is it. Despite from all the advantages of triple bottom line toward the corporation, there do have some criticism for it. The triple bottom line framework expanded on the process used in developing the basin plan, and supported. He speaks with imedia about why brands need to have a threetier approach to roi if they want to remain relevant to current and future consumers. Corporate social responsibility csr is about how businesses align their values and behavior with the. Csr strategies that deliver on the triple bottom line. The triple bottom line is also related to corporate social responsibility csr, people planet profit, circular economy, natural capitalism, biomimicry. The late 1990s saw the term triple bottom line take off. Increased employee retention also was seen as an advantage of implementing the triple bottom line. The three fundamental criticisms of the triple bottom line.
The triple bottom line explained angela lewis consulting. Business as usual now has a very different meaning. Triple bottom line as sustainable corporate performance. Getting to the bottom of triple bottom line business. Triple bottom line tbl and sustainability are two related constructs that are used interchangeably in the literature. Jun 25, 2018 about 25 years ago, john elkington coined the term triple bottom line as a challenge for business leaders to rethink capitalism.
The triple bottom line approach profit, people and planet arose out of frustration with traditional, financiallyfocused measures of business performance, which have tended to emphasise profit as the key metric. Uppsala university, department of earth sciences master thesis e, in sustainable development, 30 credits printed at department of earth sciences, geotryckeriet, uppsala university, uppsala, 2014. An approach to measurement of sustainability is by using triple bottomline accounting elkington, 1997. The triple bottom line tbl concept is increasingly being used by organisations to report on how they are responding to sustainability issues under the headings of environmental, social and economic performance. The triple bottom line and social responsibility framework in. In taking this approach, we find that decision making for sustainability necessarily involves a more integrated view than is currently promoted as a triple bottom line approach. Another theory of corporate social responsibility is the triple bottom line. Sutammi 36 a surakarta 57126, indonesia 2 oslo school of management, p. Like the csr theory we just discussed, triple bottom line works on the assumption that the corporation is a member of the moral community, and this gives it social responsibilities. Enter the triple bottom line john elkington in 1994, the author coined the term triple bottom line. The triple bottom line tbl framework is gaining popularity as more companies implement sustainable business strategies. Apr 18, 2011 triple bottom line for csr slideshare uses cookies to improve functionality and performance, and to provide you with relevant advertising. Sustainability, the triple bottom line, and the global reporting initiative by paulette l.
However, a triple bottom line is a statement of results in three areas profit, people, and the planet. An emerging idea fitting with this tradition is the triple bottom line, an innovative way of measuring an organisations environmental. Sustainability, the triple bottom line, and the global. It is not known and generally accepted standards of a summary of the triple bottom line that by giving to the business may not be the ethical theory or different version of ethics in business. Corporate sustainability can be measured using the triple bottom line model. How a triple bottom line approach benefits your company. It was supposed to offer a radical new way forward, as. Throughout the year, employees take time to reflect on their values and look for ways to give back.
It suggests that there are three key areas of performance. Further more, a comprehensive implementation of csr in accordance with the triple bottom line and areas suggested by the reporting guidelines may lead to the adoption of csr as an area of. Businesses need to view the impact of their work in a broader perspective of the value addition that they create for the society in terms of its people, planet and profit. Understanding csr its history and the recent developments. If you continue browsing the site, you agree to the use of cookies on this website. Corporate social responsibility csr also called co rporate respo nsibility, corporat e citizenship. Corporate social responsibility, the triple bottom line, standardization and brand management in houston, texas tashiba dixon. The phrase, people, planet, and profit to describe the triple bottom line and the goal of sustainability, was coined by john elkington in 1994 while at sustainability, and was later used as the title of the anglodutch oil company shells first. The triple bottom line tbl is a method that allows companies to assess their performance against three bottom lines. Corporate social responsibility elkingtons triple bottom line. This requires an increased level of cooperation among businesses, nonprofit organizations, governments and citizens of the region. This concept is called a triple bottom line tbl or 3bl, for short and its a business approach that includes social and environmental results, beyond the more traditional single metric of the bottom line. Corporate social responsibility and the triple bottom line. An emerging idea fitting with this tradition is the triple bottom line, an innovative way of measuring an organisations environmental, social and economic impact.
Every business is different and one approach wont suit all organisations. In this paper, we examine critically the notion of triple bottom line accounting. Corporate social responsibility and sustainability. Corporate social responsibility, the triple bottom line, standardization and brand management in houston, texas corporate social responsibility, the triple bottom line, standardization and brand management in houston, texas tashiba dixon tashiba dixon uppsala university, department of. Jun 04, 2016 elkingtons triple bottom line model encourages businesses to take a broader approach to business performance. Corporate social responsibility, the triple bottom line, standardization and brand management in houston, texas corporate social responsibility, the triple bottom line, standardization and brand management in houston, texas tashiba dixon tashiba dixon uppsala university, department of earth sciences. The triple bottom line or otherwise noted as tbl or 3bl is an accounting framework with three parts.
Many firms are realizing that having a strong sustainability or csr proleadership and the triple bottom line. Some organizations have adopted the tbl framework to evaluate their performance in a broader perspective to create greater business value. A simple explanation of the triple bottom line university. The triple bottom line the term triple bottom line was coined by john elkington in 1994 in an attempt to create a new language to express what was perceived as an inevitable expansion of existing corporate models, from purely economic values to economic values as a. Interest in triple bottom line accounting has been growing across forprofit, nonprofit and government sectors. Then, based upon the concept of triple bottom line, a revised model of sustainable entrepreneurship was suggested at the end of paper. While this paper will not be exhaustively comprehensive on the topic, it should still provide an overview of the good and the bad of mcdonalds. Elkingtons triple bottom line csr business tutor2u.