I know it sounds like one of those Multi-Level Marketing (MLM) come ons. However, the concept of a Triple Bottom Line is catching on with many businesses.
Triple Bottom Line
Triple Bottom Line is voluntary reporting some companies use to measure their ecological and social impact alongside their financial performance. Utilizing various techniques a company may capture their financial (profit), ecological (planet) and social impact (people). The triple bottom line becomes 1) financial, 2) ecological and 3) social impact.
Let’s take a look at the three different metrics.
We are all familiar with the usual financial reporting for the Balance Sheet, Income Statement , and Statement of Retained Earnings. These tools will show us the financial “bottom line“. The key difference in financial approach is making a reasonable profit while actively harmonizing the ecological and social principles rather than maximizing profit.
Businesses consider their ecological impact in all that they do. The concept of “cradle to grave” is expanded to be “cradle to cradle”. Companies take responsibility for products like computers after they have been purchased. Companies like Dell recycle or take back the computer.
Think about how well that approach fits with the mantra of Reduce, Reuse and Recycle.
Social Impact (People)
It is all about your people — employees and your community. Providing fair compensation to employees is the inside the company part of the equation. The outside the company or community side of the equation is achieved with sponsorships, donations of cash, products or services in kind, or work on projects.
Sharing a portion of the financial bottom line helps everyone. Think about all the goodwill and positive public relations.
A little extra tracking and work will allow you to capture your Triple Bottom Line. Product Managers and Product Marketers looking to improve a product or service image should consider this tool. Companies are looking to get “green” or “greener”. Publicizing your Triple Bottom Line provides bona fides for your company’s “green” image.
Over to You. What Do You Think?
- How familiar are you with Triple Bottom Line?
- Does your company use Triple Bottom Line?
- Do you think more positively about a company that reports Triple Bottom Line?