Double Bottom Line
Double Bottom Line
The double bottom line, also known as the “triple bottom line” or “people, planet, profit,” refers to the idea that businesses should be held accountable for not just their financial performance, but also their social and environmental impacts. It’s a way of measuring a company’s success not just in terms of financial profits, but also in terms of its contributions to society and the environment.
The concept of the double bottom line was first proposed in the 1990s as a way to shift the focus of businesses from solely maximising profits to also considering the social and environmental impacts of their operations. This shift in focus has been driven by a growing recognition that businesses have a responsibility to contribute to the well-being of society and the environment, not just to their shareholders.
The double bottom line approach requires businesses to report on their financial performance, as well as their social and environmental impacts. This can include things like the company’s carbon emissions, water usage, waste generation, and employee satisfaction. By measuring and reporting on these non-financial impacts, companies can provide a more complete picture of their overall performance and impact on society and the environment.
There are several benefits to the double bottom line approach. First, it encourages businesses to be more mindful of their social and environmental impacts and to consider these impacts when making decisions. This can lead to more sustainable business practices, which can have long-term benefits for the environment and society.
Second, the double bottom line approach can also help businesses to build trust with their stakeholders, such as customers, employees, and investors. By demonstrating their commitment to social and environmental responsibility, businesses can improve their reputation and attract more loyal customers and employees.
Finally, the double bottom line approach can also help businesses to identify new opportunities for growth and innovation. By considering their social and environmental impacts, businesses can identify new markets and products that align with their values and goals, leading to increased profitability and sustainability.
Overall, the double bottom line represents a shift in the way businesses think about their role in society and the environment. It recognises that businesses have a responsibility to contribute to the well-being of society and the environment, and encourages them to consider these impacts when making decisions. By adopting the double bottom line approach, businesses can not only improve their financial performance, but also make a positive impact on society and the environment.
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