Assignment 1
The 20th century saw a burst of business growth. As the century progressed, the need to attend to the impact of business on people and on the environment became impossible to ignore. In 1994, a British man named John Elkington coined the phrase “triple bottom line” (TBL) as a memorable way of encouraging business leaders to pay more attention to the impact of their operations on people and the planet. “Triple bottom line” thinking is not anti-profit. As a business philosophy, it takes into account the fact that business cannot continue without a profit. When the expenses exceed the income, someone has to make up the difference. Always. Instead, Elkington simply argued that when you are making decisions and paying attention to the likely impact on the bottom line, you should also pay some attention to the likely
impact on people and planet. For any new product or service, it is essential to ask, Can we make and sell this profitably? Elkington argues that in that same decision-making process, the people gathered need to ask, Should we make and sell this at all? Can we make and sell this in a way that is good for the people doing the making? What impact will this have on our community? What impact will this have on the environment? The goal is not to stop business as a means of organizing resources and people to meet human needs. The goal is to raise the bar on how we do business to make sure
everything we choose to do, and every system of operations created, is not only profitable, but also beneficial to people and planet. Change is hard. And once a business is built around harmful practices, it can be quite difficult to change all the systems, procedures, and processes that enable the business to operate profitably. But consider the alternative: to continue operating in the normal way despite it causing irreversible harm to people and planet. That’s really not an option once you know there’s a viable solution. The good news is that it is entirely possible to operate profitable businesses in ways that empower people and build up communities. Many companies have proved that we can change our ways of operating businesses to reduce environmental harm and, at our best, play a restorative role in the world around us. In the 25 years since John Elkington first penned the phrase “triple bottom line,” the business world has been revolutionized. Today, nearly every Fortune 500 company has a webpage on sustainability or social responsibility. The change is not complete, but the past two decades are full of success stories of leaders who have found that considering people and planet doesn’t prevent profit so much as it encourages innovation and creative thinking that is essential to ensuring that businesses generate value even more broadly. It’s difficult to know what the next 25 years of business will bring. But given the precarious state of our society and environment, it’s essential that businesses continue to serve all three components of the triple bottom line.
Multiple-Choice Question
What is the ideal result of adopting the “triple bottom line” perspective?
