Definition of Triple Bottom Line

A business that uses triple bottom line reporting aims to produce healthy employees and a minimal environmental impact.

Companies and corporations use a variety of measures to determine their success. At the forefront of these measures lies their financial returns, or how much profit the entity makes. But in recent years, businesses aiming to be environmentally friendly are using other measures to calculate their success.

Definition

Triple bottom line is a type of reporting that looks at a business' social and environmental values, as well as its financial returns. Namely, the triple bottom line looks at how happy and healthy a business' staff is. It also examines its impact on the environment.

Importance

Businesses who follow a triple bottom line model treat their employees with respect and pay them a fair wage. It gives back to the community through donations and projects. Companies also attempt to minimize its environmental impact by studying the raw materials they produce and lowering toxic byproducts. Businesses can then earn an honest profit, instead of a profit at any cost.

History

The term was first used by John Elkington, co-founder of the business consultancy SustainAbility in 1989. Later, Elkington made it the focus of his 1998 book "Cannibals with Forks: the Triple Bottom Line of 21st Century Business." The model has become a cornerstone for green businesses across the country.

References

• The dictionary of sustainable management: Triple bottom line
• Green living tips: Triple bottom line