Thursday, July 9, 2009

Triple Bottom Line: Building Sustainability.

Recently the discussion of green businesses and sustainability has centered on the concerns that going green will cause the bottom line to suffer. The solution is to update the definition of the bottom line. People are living and operating businesses in the era of the triple bottom line: profit, people, and planet. This didn’t happen overnight. In fact, John Elkington coined the term back in 1994. Surprisingly, is was only ratified in 2007 by the United Nations as the dominant approach to determining the full cost associated with public sector projects. Now that it’s here we better understand why the shift finally occurred. This shift to a triple bottom line focus is the result of generational changes: Boomers to Xers to Millennials.

The hippies grew up to become yuppies in the 1980s. There was a lot of focus on profitability. That decade has been associated with greed, but it was also associated with amazing growth and wealth generation.

The slackers grew up to become social advocates in the 1990s.
The people side of an enterprise was given greater consideration. Catered meals and work/life balance became standard for many companies.

The entitled are growing up to become environmental advocates in the early part of this century. There is a focus on being green, renewable, and globally responsible. Recycling programs and innovative sources are the focus.

From profit to people to planet, all three now make up the bottom line. Interestingly, as the Boomers are entering their retirement years, they are also taking time to reconsider what to do with their amassed wealth. Yuppies are becoming hippies again. Capital is now moving toward triple bottom line solutions. With the addition of each variable to the bottom line, the time to profitability or realized return on investment is delayed.

With each variable, costs generally increase. A balanced focus on each variable means a focus on sustainability—a sustainable company, solution, planet, and ultimately a sustainable return on investment.

Here’s the rub. It is not just business that must shift to a triple bottom line lens. Policy-makers, consumers, non-profits, and educators need to use the triple bottom line lens as well. All parties working in concert will create efficiencies that will lead to a greater (or faster) return on investment.

How are you impacting the triple bottom line?
Do you think triple bottom line standards are unattainable?


  1. Interesting assessment of the generations. It is true that a generation changes over time and the phase of life they are in. It is also kind of a outside perception vs. self perception concept.

  2. Good point with the "inside vs "outside" perspective. I think is funny that more senior generation seem to always dislike certain things about the more junior generation. I think it is important for the senior generation to recognize its role in shaping and modeling the younger generation. Things do not happen in a vacuum.