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Furthermore, corporate social responsibility is a proactive approach to theÂ public's interestÂ by honouring the triple bottom line, the triple bottom line and corporate social responsibility must work hand in hand in becoming the excellent guide for organizations to abide because this approach is a holistic concept of sustainability in which environmental, social and economic are taken into considerations and identified in decision making, hence the decision made would affect the future of the biosphere.
Triple bottom line started way back during the 1987, founded by activists John Elkington and Julia Hailes, it then expanded and evolved throughout the years, becoming more effective and sustainable to benefit the economy, protecting environment and the society. Now increasing amount of organizations are implementing triple bottom line to ensure the future of their company as well as the people.
The main reason corporations' should adopt the triple bottom line approach as a goal for their businesses is to increase revenue and market share. A good example of an organization that has applied triple bottom line with deliberation of social
responsibility and environmental is Starbucks Coffee Bean, their acknowledgement for fair trading to coffee growers has paid off, as we can see, their highly profitable. In this new era, originality is very important, especially when there are so many highly innovative and competitive leaders and consumers emerging. Moreover, stakeholders and corporations would only do businesses with companies that adopted triple bottom line and has a reputation for being socially responsible. Due to adopting triple bottom line, stakeholders and customers will be more supportive towards the organization knowing that it doesn't emphasize on profit only but also takes the accountability of the biosphere, thus, resulting in an increase of market share. In addition, this approach also increases revenue by saving cost because organizations would have to be more innovative and optimistic for new market opportunity by making profit with the sincerity of the people and planet. Hence it would improve the organizations reputation as a responsible legal person.
Besides that, by implementing triple bottom line it would enhance employee retention because in this modern world, many people aren't just looking for a high income job but also the acknowledgement of corporate social responsibility. Organizations that have a higher sustainability also known as triple bottom line or corporate social responsibility would be beneficial in both recruitment and retention of talent. Hence, the environment today is very intense and maintaining talented workers can be difficult; by applying the triple bottom line it would ensure talented workers would stay in the organization because they understand that their job isn't just for the company's profit but it is meaningful and important for the biosphere.
Moreover, by viewing the triple bottom line as a new goal for businesses, it improves the community support and builds good reputation towards the organization because the public is a powerful influence on a firm's 'license to operate'. Most of the time companies are under great scrutiny either from the media or watchdog groups. There is no better way to avoid this than acquiring the triple bottom line because any mistake that happens the business would be jeopardize and organizations would be accountable for their actions. Which means, those who fully participate in the environmental and social policies will succeed and those who ignore this approach would most likely fail. Thus, by abiding the triple bottom line, the company would be viewed as a responsible corporate citizen and partner whom engages the public with concerns for their environmental and social impacts; such as; educational programs, charitable campaigns, and visibility of issues, hence improves the business by opening the doors for dialogue and positive stakeholder relationships.
Carrying on, organizations that incorporate the triple bottom line would be seen as a healthier investment, making it easier for businesses to procure funds. For example; Dreamworks Animation organizes many teams of Triathlon for Pediatric AIDS to show their support to the community, in addition they also organize campaigns for the AIDS Project Walk and this contributes to the motion picture and television funds, hence increasing their investment rate for potential investors. There is no denial that every businesses main objective is to make profit, and due to greed, many organizations reputation and customer support has deteriorated, resulting in losses and breaking laws. Therefore to solve this issue, the triple bottom line approach is inevitable because it helps organizations avoid regular issues, bad image to the society, and angering particular groups; such as, environmental supporters.
Cost reduction is another benefit why businesses should view triple bottom line as their new goal. An example, Bayer Material Science, manufacturers of polymers and high-performance plastic uses new lighting fixtures in its building for brighter and more energy-efficient lights, but this new fixtures consumes less energy, thus, the company reduces cost. This action results too more benefits because the electric utility company would generate less electricity, hence reduces air pollution which's reduces environmental impact. In addition, the brighter lighting fixtures create a better working environment for employees. Therefore we can see by one organizations action, it leads to the the triple bottom line at work.Â By implementing this approach, businesses would be able to minimize the room for error, meaning 'doing it right the first time', in addition, in a business point of view, triple bottom line focuses on strategic planning and forecasting problems before it occurs. Hence, ensures the efficient use of resources without wastage, because if there is wastage and error, it would mean draining resources from the earth again and damaging the environment. The implementation of this approach also helps reduce organization cost by reducing the turnover rate, because businesses that apply the triple bottom line has a higher employee retention, which allows improvement of employee's morale and productivity. Overall businesses would be able to improve their production of quality goods.
Furthermore, triple bottom line helps organization improve their customer's loyalty because most customers would rather support a business that has less damage on environmental impact and more social responsibility, for example; Royal Dutch Shell, they have been partnering with environmentalist and with the help of latest technologies to reduce their operation impact on the environment. Another good example; would be Peace Coffee, they apply the triple bottom line theory throughout a wide range of business aspects. To deliver their goods, they would ensure bio-diesel vans or by bicycle. Moreover, their coffee beans are grown by many cooperatives small coffee farmers and mostly certified as fair trade. Peace Coffee's has also installed a new coffee roaster, which is equipped with aÂ catalytic oxidizerÂ , this machine helps decompose and burn hydrocarbons to limit emissions that is toxicant to the air. With this, their consumer's loyalty maintains and increases day by day. Every business has to meet the customer's needs and expectations, to strengthen the customer's loyalty, therefore, by aligning the organizations values and actions with the stakeholder's expectations corporations would gain more customer loyalty.
By adopting the triple bottom line it also helps businesses reduce their risk profile, by proving the company's commitment in minimising risk when there is an increase in litigation, and where diligence can be established, a company would be able to establish risk in a better method. In turn, this would improve stakeholder's relationship by attracting them to invest in the organization more, hence increase capital and resulting in a positive outcome to the share price. Stakeholders are people as well, so we are all risk adverse aiming to make profit in our daily business at the lowest risk level, and there is no better way than investing in a business that practices the triple bottom line.
The triple bottom line is not only viewed as a new goal for businesses but also as an inspirational activity for the entire organization to built their scope of innovation. Triple bottom line focuses on all aspect of people, planet and profit; therefore an organization may have to invent something new that benefits all the aspects. One of the best example; is Pacific Sands Inc, this company only creates, manufactures, and sells a variety of unique, earth, health friendly products for household appliance. In addition, it attracts a new consumer group which helps generate more profit and at the same time protecting the environment. These are a special group of people, whom are very conscious about the environment and does not intend to leave any footprints behind, therefore they would only purchase products which does not harm our earth; such as, non-woven bags and bio-degradable products. Besides that, organizations that implement the triple bottom line would feel proud knowing that their actions are making an important difference maintaining and improving our planet and natural resources for the future generations of people.
Another reason why businesses should view triple bottom line as a new goal is to increase employees' productivity due to adopting this approach the whole organization engages in a sustainable development goal; such as, zero emissions, producing self-sufficient energy, zero wastage and most importantly contributing in restoring the planet's health, with this businesses would have a higher return from employees. Increasingly, customers and employees would involve themselves in an organization that makes a difference supporting the economic, society and the environment. In order to strengthen this involvement, companies must show employees and customers that there is something larger than just making company profits. The triple bottom line approach helps organizations understand the importance of people, plant and profit, therefore organization could prove their responsibility to employees by paying a reasonable living wage, which would be able to provide an adequate living time, importance of health care and safety towards employees, incentives should be given to employees after meeting the triple bottom line objectives, and providing the employees with a healthy and efficient working environment.
In order to be at the top of the food chain in this dog eat dog world, businesses should view the triple bottom line as a new goal to prove that by using the profit made for the greater good; such as funding money to the people of poverty and team building campaigns for employees. When organizations gain full support and loyalty from their employees and customers, with the implementation of triple bottom line, they would then realize their strength in the business world. It is a continuous improvement to thrive for the best but in an ethical way. Companies like Nike and Interface have been called many evil names and has been discriminated by their own employees and customers for many unethical, poor environmental and public decision made, but these corporations soon regained their strength and reputation by applying the triple bottom line to gain profit, thus, it is a mutual benefit for the people and corporations.
But if the organization adopts the triple bottom line approach it helps to reduce expenses for manufacturing goods because this approach considerate the aspect of people, planet and profit, therefore wastage is evitable. Waste can be put in many different terms, but if waste is to be replaced by 'unnecessary spending of corporate assets', corporations will be at risk, because shareholders would then take this opportunity to save money instead of investing in the firm. If businesses manage to reduce squandering these assets extravagantly, the outcome would be a win-win situation for manufacturing and environmental. In addition, the triple bottom line helps businesses reduce manufacturing expenses by substituting current materials used into a more environmental friendly raw material and energy source. Hence, it also helps by re-using and recycling wasted energy or unwanted materials and making it into useful products rather than throwing them away. Like they say, "One man's junk can be another man's treasure."
Furthermore, businesses should view triple bottom line as a new goal because it helps reduce pointless expenses at commercial sites, where most of the unnecessary waste takes place outside the manufacturing site. By implementing this, companies can benefit from more heady waste dealing, energy efficiency, water conservation and natural landscaping, hence increases pure profit. Due to triple bottom line, innovation drives organization to create new products that protects both community and environment, therefore High Efficiency Energy Recovery Ventilation (HE-ERV) system has been invented and sold on the market, this system helps commercial and residential building owners reduce High Voltage Alternating Current energy consumption, hence reduces costs and Carbon Dioxide emissions.
Last but not least, the reason why businesses should view triple bottom line as a new goal and has to be executed perfectly due to enhancement of their reputation and brand power, because if not planned well, watchdogs would just assume that the triple bottom line is being used as a marketing ploy and it would damage the reputation and brand of the organization extravagantly. An excellent example of an organization that viewed triple bottom line as a goal and successfully accomplish multinational corporation status is Novo Nordisk, a health care professional, their reputation and brand is well known throughout the whole world for their relentless commitment to a healthy economy, environment and community. Furthermore, to increase the reputation and brand effectively, communication skills with stakeholders regarding the triple bottom line aspect must be considerate because it is important to manage the stakeholder's perception hence increase and assist the company's reputation and brand power.
The importance of triple bottom line for a business success is essential because it emphasize to greatly improve the relationship between the organization and the key stakeholders which are; customers, shareholders, suppliers, investors, special interest groups and employees. With this, organizations can maximize its future growth knowing that they have full support of the community because they acknowledge the people, profit and planet.
In the end, triple bottom line is more than just a corporate responsibility but a corporate decision, it's an ongoing process towards a healthy business and demonstrating to the public that organizations work not only for richness but for the greater good because nowadays consumers take that very seriously, even so, the key responsibility for every business is to behave in an ethical manner to justify that triple bottom line isn't just a marketing strategy nor a norm, but an important guideline to heightened concern in society and the biosphere. To simplify, without people and planet there won't be profit.