Triple Bottom Line (TBL)

Prasanna Perera, Marketing and Management Consultant, Chartered Marketeer, CIM UK

Triple Bottom Line (TBL) captures the essence of sustainability, by measuring the impact of an organization's activities on the world. The Triple Bottom Line is commonly referred to as people (society), planet (environment) and profits.

In conducting business, organizations should use not only financial resources, but also environmental resources and social resources. A positive Triple Bottom Line, reflects an increase in the company's value, including both its profitability and shareholder value and its social, human and environmental capital.

Sustainable corporation

Is an organization that creates profits for its shareholders, while protecting the environment and improving the lives of those with whom it interacts. A sustainable corporation practices the Triple Bottom Line (TBL) concept.

Stakeholders - Key to TBL Concepts

Marketeers generally pay more attention to their customers, rather than stakeholders. This has to change and a stakeholder perspective needs to be taken, if the TBL concept is to work.

Business today is carried out in an interdependent world and this requires organizations and their marketeers to develop open relationships with their stakeholders, for mutual benefit. In the long run, this will create more profits for the organization and more social, economic and environmental prosperity for society.

Marketeers contribution to TBL (Triple Bottom Line)

Although marketeers alone cannot ensure that the TBL concept is practiced, they can play a vital part in the process.

If the environmental perspective is considered, Life Cycle Analysis (LCA) is something that marketeers must understand and adopt. LCA is simply a complete understanding of the overall environmental implications of the services required by society.

This promotes the consideration of the cradle-to-grave implications of any actions taken. Let us take the example of a company marketing beverage products in paper based aseptic packaging. This company needs to ensure that the used packages are either disposed with minimum environmental impact or recycled for paper / pulp production. If this initiative is taken, then this company is committed to sustainability and the TBL concept.

Even retailers who market the beverage products of this company, need to be committed to sustainability or else the company concerned will find it really difficult to implement sustainability imitativeness.

With regard to social responsibilities, this beverage company should ensure that the product is not harmful to consumers and the ingredients used are in line with approved regulations.

The company should engage intermediaries that respect good labour practices and human rights. For example, the company should not engage middlemen that employ child labour or do not pay the minimum wages stipulated. The company concerned can carry out intermediary and supplier audits, as a commitment to good social and environmental practices.

Another aspect of social responsibility, is supporting good social causes referred to as corporate social responsibility (CSR).

The beverage company concerned can engage in meaningful CSR initiatives, which is compatible with their corporate values and industry specifics / dynamics.

For example, they can work in partnership with their suppliers on CSR initiatives such as improving societal well being and quality of life. Similarly, partnerships with intermediaries can also be forged to initiate and implement CSR initiatives.

Marketeers cannot be committed to TBL alone

TBL is an organization wide initiative, that all departments must understand and contribute.

Marketing being a “boundary opening” discipline, naturally is called upon to become the CSR catalyst. Whilst this is acceptable, other supply chain members within the organization must cooperate and support marketers to drive CSR programmes.

TBL benefits must be quantified

People (society) and planet (environment) initiatives must be measured in quantifiable terms. This will minimize the tension between shareholders and TBL initiatives. (Most shareholders are only concerned about profit)

Message to Sri Lankan corporates

Do not engage in CSR activities for the sake of doing so. CSR is not a fad that comes and goes. It is an organization-wide commitment to protect the society and environment, whilst delivering value to stakeholders. All CSR initiatives must be measured and quantified. After all, shareholder funds are being utilized and accountability is a prerequisite.

Integrate all CSR initiatives, with the Triple Bottom Line (TBL) concept.

This is what best run global companies have done and have achieved economic, social and environmental success.

Work in partnership with supply chain partners on TBL /CSR initiatives. It is not only cost effective but also easier to integrate and measure.

Take a stakeholder perspective in running the business. Understand stakeholder needs and develop TBL initiatives accordingly. Marketing activities should not only generate profits but also be meaningful to society and protect the environment. The days of profit maximization at any cost, is long over. Organizations that do not give consideration to the society and environment, will face many pressures in the years to come.