For anyone considering beginning a green-based business or perhaps even just thinking about aiming towards making your existing business greener, then you will need to understand and embrace the Triple Bottom Line.
John Elkington coined the phrase originally in 1994 and further expanded upon it to explain the Triple Bottom Line as taking into account any ecological and social issues as well as just the financial aspect of the business.
Triple Bottom Line or TBL means taking into account the impact your business practices will have on people, planet, and profit. This means taking accountability for the people in your business, the impact your business’s environmental practices have on the planet and of course maintaining profit to sustain the continued business growth in the long term.
Happy staff is productive staff and a company that strives to create a workplace that treats employees well. It is also well known that staff who enjoys their workplace also tends to miss fewer days of work, which can also lead to an increase in productivity.
TBL business practice is more than just making staff happy. It should actively avoid exploitation and strive to pay fair salaries for the work conducted. It should also include creating and maintaining a safe workplace and setting working hours that are not detrimental to employees or their families.
Triple Bottom Line practices move beyond just the immediate employees within your company and encompass the people in the community as well. Local businesses that actively support and contribute to community issues are far better received by people in the general community.
Responsible TBL business practices that follow models designed to reduce the environmental damage that may be caused can mean adjusting the “old” way of doing things and investigating newer, greener options.
This can mean a TBL company chooses products or production processes that minimize ecological impact or actively recycling potentially damaging items. Businesses could also move to actively reduce the company’s ecological footprint by reducing energy consumption and working to reduce the level of ecologically damaging practices.
Traditionally, businesses were operated based on the financial viability of conducting that business. This meant that profits were the only bottom line and this was often created at the expense of the environment and the people being affected by that company’s need for financial success.
Without a profitable financial bottom line, most businesses would fail very quickly. Even though a business should be sure its working practices are considerate of the people it may affect as well as the environmental issues it may impact upon, the profits still need to be realized in order to remain in business.
Businesses that strive towards a Triple Bottom Line accounting practice may also find that a new generation of investors are scrutinizing environmentally conscious companies favorably. They call this “green investing” and companies that show responsible operational conduct to the ecology and the community can be included in the “green investing” list of preferred companies in which to invest.