Triple bottom line

Prof. S.Swaminathan
TBL
TBL
 TBL

• Broadens a business' focus on the financial

bottom line to include social and
environmental considerations.
• Measures a company's degree of social
responsibility, its economic value and its
environmental impact.
• Phrase was introduced in 1994 by John
Elkington and later used in his 1997 book
"Cannibals with Forks: The Triple Bottom Line
of 21st Century Business."
 TBL
• Focus of companies is extended beyond
profits to include social and environmental
issues to measure the total cost of doing
business
• In addition to economic bottom line, consider
social and environmental areas in making
investing and business decisions.
• Deploying money and other resources, such as
human labor, to a project or an investment
can either contribute to these three goals or
focus on profit at the expense of one or both .
 TBL
• Some repercussions ignoring TBL in the name of
profits include destruction of the rainforest,
exploitation of labor, and damage to the ozone layer.
• TBL means Earns financial profits but also betters
people’s lives and helps the planet. The elements of
the TBL are referred to as "people, profits and
planet.“
• Can be challenging to maximize financial returns
while also doing the greatest good for people and
environment.
 PROFIT
• Maximize financial returns while also doing the
greatest good for people and environment.

• Consider a clothing manufacturer

• Many consumers want companies to be transparent

about their practices and to be considerate of all
their stakeholders
 PEOPLE
• People - shifts the focus to fair treatment of
employees and off-site labor, as well as
enacting favorable practices in the
communities where companies conduct
business.
– Eg., Mars, Incorporated's Cocoa for Generations -
cocoa planters to be certified by fair trade
organizations to ensure they follow a code of
conduct that includes fair treatment of labor. In
exchange for certification, Mars provides
productivity technology and buys cocoa at
premium prices.
 PLANET
• Implementation of sustainable practices and the
reduction of environmental impact. These measures
range in scope from green initiatives such as
recycling programs and manufacturing products
using only sustainable materials.

• For example, Axion Structural Innovations builds

railroad ties and pilings using recycled plastic bottles
and industrial waste instead of using standard
materials such as wood, steel and cement.
 ISO 26000 :2010 -

• International standard developed to help

organizations effectively assess and address
social responsibilities that are relevant and
significant to their mission and vision;
operations and processes; customers,
employees, communities, and other
stakeholders; and environmental impact.
Recognizing social responsibility and engaging
stakeholders.
Ways to integrate socially responsible behavior
into the organization.
 7 Principles
• Accountability
• Transparency
• Ethical behavior
• Respect for stakeholder interests
• Respect for the rule of law
• Respect for international norms of behavior
• Respect for human rights
 7 Core Subjects

• Organizational governance
• Human rights
• Labor practices
• The environment
• Fair operating practices
• Consumer issues
• Community involvement and development
 Organisation Governance
• Decisions are to be made in consideration of the
expectations of society.
– Accountability,
– Transparency,
– Ethics, and
– Stakeholders
should be factors in the organization’s decision-making
process.
 Human Rights
• All humans have the right to fair treatment and the
elimination of discrimination, torture, and
exploitation.

Due diligence
Human rights risk situations
Avoidance of complicity
Resolving grievances
Discrimination and vulnerable groups
Civil and political rights
Economic, social, and cultural rights
Fundamental principles and rights at work
 Labor practices
• Those working on behalf of the organization
are not a commodity. The goal is to prevent
unfair competition based on exploitation and
abuse.
– Employment and employment relationships
– Conditions of work and social protection
– Social dialogue
– Health and safety at work
– Human development and training in the
workplace
 Environment
• The organization has a responsibility to reduce and eliminate
unsustainable volumes and patterns of production and
consumption and to ensure that resource consumption per
person becomes sustainable.
– Prevention of pollution
– Sustainable resource use
– Climate change mitigation and adaptation
– Protection of the environment, biodiversity, and
restoration of natural habitats
 Fair operating practices
• Building systems of fair competition, preventing corruption,
encouraging fair competition, and promoting the reliability of
fair business practices help to build sustainable social systems.

– Anti-corruption
– Responsible political involvement
– Fair competition
– Promoting social responsibility in the value chain
– Respect for property rights
 Consumer issue
• The promotion of just, sustainable, and equitable economic
and social development with respect to consumer health,
safety, and access is the organization’s responsibility.

– Fair marketing, factual, and unbiased information and fair

contractual practices
– Protecting consumers' health and safety
– Sustainable consumption
– Consumer service, support, and complaint and dispute
resolution
– Consumer data protection and privacy
– Access to essential services
– Education and awareness
Community involvement and development
• The organization should be involved with creating
sustainable social structures where increasing levels
of education and well-being can exist.
– Community involvement
– Education and culture
– Employment creation and skills development
– Technology development and access
– Wealth and income creation
– Health
– Social investment