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What is triple bottom line?
Under the sustainable development model, an organization on the path of success must embrace all that can be categorized under Financial Responsibility, Social Responsibility and Environmental responsibility.
Most companies are simply focused on financial aspects of the business and either they do not care or less focused on the other two objectives.
According to The Economist, the phrase “the triple bottom line” was first coined in1994 by John Elkington, the founder of a British consultancy called SustainAbility. His argument was that companies should be preparing three different (and quite separate) bottom lines. One is the traditional measure of corporate profit—the “bottom line” of the profit and loss account. The second is the bottom line of a company's “people account”—a measure in some shape or form of how socially responsible an organisation has been throughout its operations. The third is the bottom line of the company's “planet” account—a measure of how environmentally responsible it has been. The triple bottom line (TBL) thus consists of three Ps: profit, people and planet. It aims to measure the financial, social and environmental performance of the corporation over a period of time. Only a company that produces a TBL is taking account of the full cost involved in doing business.
Successful corporations focus on identifying their stake holder groups and incorporating their needs and values within the strategic and day to day decision making process not just to achieve financial objectives but also in giving back to the society of which they are a part of and operate within.
Triple bottom line (abbreviated as TBL or 3BL) also commonly called the three Ps: people, planet and profits and are referred to as the "three pillars of sustainability." Use to evaluate organization performance in a broader context.
Dear Hanna,
TBL, 3BL, "People, Planet, Profit" or "The Three Pillars: describing the separate financial, social and environmental "bottom lines" of companies and it used to measures the company's economic value and measures the company's environmental responsibility.
The TBL is an accounting framework that incorporates three dimensions of performance: social, environmental and financial.
This differs from traditional reporting frameworks as it includes ecological (or environmental) and social measures that can be difficult to assign appropriate means of measurement.
The TBL dimensions are also commonly called the three Ps: people, planet and profits. We will refer to these as the3Ps.
Regards,
Hany Sewilam AbdelHamid
Head of Business Development & Operations
Entrepreneurship Coach & Consultant
- http://www.sewilam.com
- facebook.com /Orkanza
- twitter.com /HanySewilam
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