Triple Bottom Line

We had a great speaker in our Corporations and Communities class last week - Andy Savitz, author of "The Triple Bottom Line". I've never read the book, but have definitely heard the term use many, many times. The triple bottom line basically takes into account not only the economic bottom line in a business, but also the effects of business on people and the environment. We spent alot of time talking with Savitz about how we've reached this age of accountability on the part of businesses. Business used to just be about making money, but now businesses are accountable for so many other factors, such as public health, labor standards, environmental effects.

The point that Savitz strives to make is that there is a sweet spot for businesses where they can make profits, as well as solve some social problem. A few examples that we spent time talking about were Toyota and the Prius and GE's Ecomagination campaign. Both of these segments of their respective companies are responsible for generating a huge portion of revenue for the companies, but are also revolutionizing the their respective industries with respect to environmental accountability.

The phrase that stuck in my mind during most of the talk was, "Don't let the perfect be the enemy of the good." I think Voltaire is responsible for this philosophy. I struggle with companies who are still doing things that are bad for people and bad for the planet, but have a few segments that are good for people and planet, being labeled as socially responsible. However, as much as I struggle with this contradiction, I realize that there will be no such thing as a perfect company (in that they are achieving good for all three: people, planet, profit) in the very near future. Even some of the most socially responsible companies in the world - I think of Patagonia - are still probably generating some negative externalities.

So, I applaud the companies that are making strides toward being industry leaders in being accountable to the triple bottom line. As more companies embrace this approach and as more consumers demand it, I see it becoming the norm for business. And that's an incredibly good thing.