Everything you need to know about the triple bottom line

There is a growing demand for sustainability in businesses and organizations from consumers across the globe. Making products from sustainable and ethically sourced materials, ensuring fair wages and safe working conditions for workers, pledging support to social and environmental causes, contributing to non-profit organizations, and committing to achieving net-zero greenhouse gas (GHG) emissions by a certain year. The list goes on.

While several organizations are responding to the call to adopt more sustainable business practices across their operations, there are still those that may have little to no clue on how to begin. How should we go about it? Where do we start?

Fortunately, the triple bottom line approach serves as an effective tool to help businesses kickstart their sustainability efforts and journey.

The triple bottom line & the 3Ps explained

The term was coined in 1994 by renowned Business Author, John Elkington. Essentially, the goal of the triple bottom line concept is to prompt corporations and businesses to shift from solely focusing on financial profit to considering other areas such as social and environmental factors in their decision-making.

This concept can be further broken down into the 3Ps: Profit, People, and the Planet.

Profit

This refers to the “traditional measure” of corporate profit, which plays an essential role in assessing the financial health of a business. This includes economic activities such as paying taxes, creating employment opportunities, and driving innovation, amongst other things.

There’s no question that a corporation’s overall success is heavily dependent on its financial health and performance. That is why, historically, many organizations’ business goals have ended there—focusing simply on profit.

But the times are changing. Today, more and more leaders and executives are taking an entirely different approach to driving their companies. They are now discovering that they have the power to use their position to generate positive change in society and the environment, without compromising the business' financial performance.

People

This points to a business or company’s impact on society as a whole and its commitment to people.

In the traditional business model, organizations have primarily focused on generating value for their shareholders. But as more business leaders adopt a more sustainable company ethos, they have also begun to extend this focus to their stakeholders as well. This includes everyone from their employees, suppliers and vendors, customers, and members of the communities in which they operate.  

Some ways they have put this into action include ensuring fair practices within their hiring processes, abiding by fair labor laws for the safety and security of all employees, partnering with non-profit organizations that share the same purpose-driven goals, and more.

Planet

While the Industrial Revolution has brought about a myriad of positive effects such as economic growth, technological advancements, and employment opportunities, it has also contributed and accelerated a staggering amount of pollution and environmental damage from the outset.

Despite the countless companies that have contributed to climate change over the years, these corporations are also the ones with the means to combat it today.

Many business leaders, just like Patagonia Founder Yvon Chouinard, have recognized their responsibility and have since been committed to using recycled and ethically sourced materials, reducing their overall energy consumption, as well as streamlining shipping and production to reduce their organization’s carbon footprint.

With more founders like Chouinard using their platform for good, businesses can move towards a greener and more sustainable way of operating, providing mutual benefit for everyone.

Why does the triple bottom line approach matter today?

You may be asking yourselves: why does the triple bottom line specifically matter in today’s day and age? Here are all the reasons why:

• Consumers are becoming more conscious
• It promotes long-term profitability
• It enhances relationships with customers
• It improves corporate culture and rapport with employees
• It strengthens the overall brand reputation and value
• It helps organizations with their Corporate Social Responsibility (CSR) efforts

1. Consumers are becoming more conscious

To put it simply, times have changed. Consumers are demanding more accountability from brands and are holding them to a higher standard. Gone are the days when customers would be easily swayed by flashy advertisements, earworm-y jingles, or copywriting that’s all fluff.

A recent study by First Insight and the Baker Retailing Center at the Wharton School of the University of Pennsylvania found that there was a significant disconnect between retailers and consumers when it came to shopping sustainably. Consumers are now willing to spend more on sustainable products and quality materials.

This rise in conscious consumerism and the shift in buying practices can be attributed to several factors like ethical concerns, increased environmental awareness, lifestyle adjustments, and individual preferences.

Today, customers want to support businesses that care not only about the financial growth of their company but also the world around them. It’s important to them that the brands they patronize are also aligned with their values and advocacies.

With that, brands and companies are now being forced to rethink their otherwise profit-first business approach and adopt more responsible ways of operating to include sustainability in the bigger picture.

2. It promotes long-term profitability

At the end of the day, profit is what makes a business go ‘round. Without it, the company would cease to exist.

When it comes to financial standing, the goal of a business is to always maximize profits while minimizing costs. This often involves cost-saving practices such as laying off employees or using lower-quality materials.

However, through the triple bottom line framework, long-term profitability can still be achieved sustainably without compromising the interests of shareholders and stakeholders or the quality of the products.

For instance, a business can start by retaining employees and prioritizing upskilling, adopting sustainable practices like using renewable energy to reduce costs, improving supply chain efficiency, and increasing external investments—all of which ultimately lead to long-term profitability. And that’s just the tip of the iceberg.

3. It enhances relationships with customers

Now that we’ve tackled the rise of conscious consumerism and the shift in purchasing habits, it’s safe to say that businesses that have adapted to this change are now at an advantage.

 Demonstrating your commitment to social and environmental change through your organization not only attracts new customers that align with your company ethos but also retains your existing customer base.

Ultimately, customers want to support brands that care. Brands they resonate with. Brands that care about more than just making a sale.

Adopting positive sustainability practices allows businesses to foster a more loyal customer base, overall strengthening customer relations. On top of all that, a credible public image can also open doors to brand new opportunities and collaborations.

4. It improves corporate culture and rapport with employees

If the triple bottom line can boost customer relations, it can also strengthen company culture and rapport among employees and other stakeholders.

To be more specific, sustainability-driven businesses have been shown to provide employees with greater job satisfaction and a sense of purpose, higher levels of happiness in the workplace, and reduced turnover rates. This isn’t all talk; there are stats to prove it.

In a 2016 study on employee engagement conducted by Cone Communications, 88% of employees found more fulfillment in their work when provided with opportunities to make a positive impact on social or environmental issues.

The same study also states that 70% of employees are more likely to be loyal to a company that helps them make impactful contributions to social issues or environmental matters.

On top of that, the Design of The Workplace Report 2023 by Brookfield Properties revealed a direct correlation between sustainability-focused companies and happier employees, where 93% of employees working in an “environmentally friendly office” feel happier in their jobs than those who don’t.

When employees can actively see that their company and work directly contribute to a greater cause—specifically one that benefits the environment—they are much more likely to stay within the organization, which increases employee retention rates in turn.

5. It helps organizations with their Corporate Social Responsibility (CSR) efforts

Last but certainly not least, using the three Ps can help businesses enhance their corporate social responsibility (CSR) efforts or kickstart them for those that haven’t implemented any.

Adopting this business model not only holds companies accountable for the societal, environmental, and economic impacts of their actions, but also demonstrates to various stakeholders and the public their commitment to using their position for good.

Every business’ CSR initiatives should go beyond donating and volunteering to include greener solutions, sustainable considerations, and ethical practices within the organization.

At its core, the triple bottom line model can serve as a tool to motivate corporations to make their CSR goals central to their operations instead of treating them as a small part of the way they operate.

Actions speak louder than words: Putting the concept into practice

Now that we know and understand the benefits the triple bottom line approach has for a business, the next step is implementation.

Here are actionable ways businesses can implement it within their organization using the 3Ps as a pillar.

Profit

• Creating employment opportunities by implementing development-focused policies
• Ensuring fair labor practices
• Invest in upskilling programs to future-proof your workforce
• Foster innovation in the workplace by creating space for experimentation
• Paying proper taxes

People

• Implementing fair trade within the supply chain
• Restructuring existing policies to ensure fair trade practices within the workplace
• Prioritizing employee welfare by introducing employee wellness programs and allowance for mental health
• Partnering with non-profit organizations that align with your company ethos
• Introducing a give-back program where a portion of the profits go to underprivileged communities

Planet

• Significantly cutting down on energy consumption
• Minimizing unnecessary packaging and waste by using post-consumer, recycled materials in the production process
• Streamlining shipping practices to reduce your overall carbon footprint
• Transitioning to renewable energy sources like solar and wind power
• Implementing GHG accounting and ESG tracking with tools like Zuno Carbon

Walking the talk: 5 companies & businesses championing the triple bottom line model

Most people might think this approach is idealistic and far-fetched in a world that prioritizes profit over purpose. However, over the years, innovative companies have consistently proven that it is possible to run a business while doing good for society and the planet. These businesses show us how it's done.

Unilever

Unilever, one of the world’s biggest consumer goods companies in the world, has pledged to drive greener initiatives across four sustainability priorities: Climate, Nature, Plastics, and Livelihood.

Through these pillars, their overarching goals are to foster regenerative and robust natural and agricultural ecosystems; achieve net-zero emissions across the whole supply and value chain; eliminate plastic pollution through reducing, reusing, and collaboration efforts; and move towards a living wage for their farmers, ensuring that they receive a decent livelihood while boosting supplier’s productivity at the same time.

Ben & Jerry’s

The first thing that comes to mind when people hear “Ben & Jerry’s” is ice cream. But what many may not know is how Ben & Jerry’s is one of the first wholly-owned subsidiaries in the world to achieve B Corp certification.

Since then, the American ice cream company has committed itself to being a force for good by partnering with and funding non-profit organizations, while also connecting its customers to various donation platforms.

At the same time, they are also proactive in raising awareness of important social and climate justice issues in a way that’s accessible to their customers. This is reflected through their limited-edition flavors, packaging information, as well as their blog posts and social media channels.

On top of their communication efforts, some notable social and environmental issues Ben & Jerry’s has taken a clear stance on include wind energy policy in the United Kingdom and refugee rights in Continental Europe, among many others.

LEGO

Over the years, the LEGO Group has also taken the necessary steps to “play a part in a sustainable future”, with a targeted focus on social responsibility and the environment.

Some of the toy production company’s most significant commitments include using sustainable materials like bio-polyethylene (bio-PE) and arMABS to create the various components, switching to recyclable packaging throughout the business, and pledging to achieve net-zero GHG emissions by 2050.

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Integrating sustainability into your business & leading by example

At this point, there is no excuse for businesses to not incorporate sustainability within their organizations.

From small enterprises to large global corporations, they have shown us that it’s possible to be financially successful while continually uplifting the communities around us and giving back to the environment.

Let this be your sign to be guided by the triple bottom line concept and its principles—it’s never too late to start.

At Zuno Carbon, we are committed to helping businesses measure carbon emissions, deliver robust reporting on your company’s sustainability performance, and lead the way towards net-zero emissions with our end-to-end ESG software.

 Want to learn more? Simply book a demo with us today to find out how to get started.

Frequently Asked Questions (FAQs)

1. What are the 3Ps of sustainability?

The 3Ps of sustainability refer to Profit, People, and the Planet.

‘Profit’ addresses the economic aspect of sustainability, focusing on the importance of maintaining strong financial health to ensure a business’ success but not at the expense of the people and the planet.

‘People’ focuses on an organization’s social responsibility towards individuals and the initiatives in place to ensure their well-being. This may include implementing fair labor practices and partnering with non-profit organizations that share the same ethos.

‘Planet’ tackles the responsibility an organization has towards the environment and moving towards greener solutions and strategies in operating a business.

2. What is the triple bottom line concept?

The triple bottom line framework is aimed at organizations and businesses to shift their focus from solely financial profit to also consider other areas such as social and environmental factors in their business operations.