A triple bottom line is an approach that balances economic success, environmental protection and social participation (Elkington, 1997). The Triple bottom line not only measures the success and health of a business through its financial statements’ but also by the social and environmental performance. It is a continuous process that helps business organizations to concentrate on sustaining a successful business as well as letting the local community know that they are not focusing on making profit only but also in giving back to the community and the environment. Business organizations that uses the triple bottom line model to capture processes and values can reduce or resolve damages that do result from their day to day activities. As triple bottom line helps the organizations create an economic, social, and environmental value. Triple bottom line highlights that organizations should take into account the needs of shareholders, stakeholders the community around them, the local government, the national government, business partners, employees and most importantly the environment (Apte, 2016).
In environmental bottom line, businesses should consider how their day to day operations impact the environment. The things that they should consider are their renewable energy and non-renewable energy resource consumption. They should also consider the type of emission that they let out to the environment. The United Nations environmental program as well as other government agencies have been working day and night in order to ensure that the environment is clean and well taken cared off, countries like the United States and the Netherlands are making great progress in trying to achieve this goal, they are making alliances with local businesses and multinationals in pursuit of a good sustainable environmental strategies. The continuous involvement of the government in environmental planning’s and treaties with business organizations have led to a lot of breakthroughs in the struggle for a better cleaner environment. Henkel is a good example of a company that has acquired the integrated management system that helps them produce quality products using environmentally friendly methods while still dealing with the traditional business values (Fry, 2013). Henkel has this saying that no product is considered a niche product or a green product all their products have to be environmentally friendly. The company has a system that develops products that are consistent with the goal of environmental friendliness (Savitz A. W., 2013). Sony is another influential company its brand strength and leading innovative designs makes it an award-winning company. Sony these days is focusing its time and money to reduce the impact on the environment; this goes to show that the company does not focus on the profits but also in the environment.
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The social bottom line refers to the fair business operations towards manpower, labor and the community in which the business operates. A business that uses the bottom line approach aims at benefiting everybody, by making sure that they do not endanger any group. It also ensures that all the members of the neighboring community benefit directly from their profits; this is referred to as giving back to the community. Firms that use the triple bottom approach ensure that no child labor is used in the manufacturing of their products and that their subcontracted firms do not use child labor (Savitz A. a., 2006). These companies offer better salaries and allowances, better working conditions and reasonable working hours. Communities that live next to these companies benefit a lot since most of the schools and hospitals are usually built by these companies. The final triple bottom line is profit. This can be defined as the economic value that a company gets after the deductions of all expenses of inputs. As a result, it differs from the traditional definition of profit. The triple bottom line does not exclude profit incentives from operations; its main aim is to balance the profit incentives with the actual expenses of production decisions which are usually externalized (Willard, 2002).
References
Savitz, A. W., & Weber, K. (2013). The triple bottom line: How today's best-run companies are achieving economic, social and environmental success -- and how you can too . San Francisco, Calif: Jossey-Bass.
Fry, L. W., & Nisiewicz, M. S. (2013). Maximizing the triple bottom line through spiritual leadership . Stanford, California: Stanford Business Books, an imprint Stanford University Press.
Apte, S. (2016). The sustainability edge: How to drive top-line growth with triple-bottom-line thinking . Rotman-UTP Publishing.
Elkington, J.(1997) Cannibals with Forks: the Triple Bottom Line of 21st Century Business ”. Capstone.
Savitz, A.W., and Weber, K.(2006) The Triple Bottom Line: How Today's Best-Run Companies Are Achieving Economic, Social and Environmental Success—and How You Can Too . Jossey-Bass.
Willard, B. (2002) The Sustainability Advantage: Seven Business Case Benefits of a Triple Bottom Line, New Society Publishers.
