TRIPLE BOTTOM LINE

UNIVERSITY CANADA WEST

31 MAY 2017

LUJING CHEN 1610163

TANG LI 1610046
 Structure
Definition/Background
Benefits and Risks
The Measures of the TBL
Case study: Southwest airline

Conclution
References
 Concept of Triple bottom line
An accounting framework propsed by John Elkington in
1997.
An important approach in terms of corporate reporting.
Is considered as the sustainable approach that is needed to
achieve success.

Economic
Figure 1 'Three Pillars' Model of
Sustainable Development based on TBL
Accounting
Social Environmental
 Concept of Triple bottom line

profit = corporate profitability

(a measure of financial performance)
people = social responsibility
(a duty company needs to perform & maintain
between economy & ecosystems)
planet = environmental responsibility
(a duty company protects the environment)
aims to measure the financial, social and
environmental performance of the company.
 How is your company?
Economically
Can your company work sustainably and make a profit?
Socially
Is your company affecting society in a positive way?
(conform with the law; treat employees equally; provide
quality products and service)
Environmentally
Is your company helping the environment?
Is your company sustainable?
 What are the benefits of TBL?

Profits People Planet

Enhanced brand value Increased customer Reduced waste in landfills
satisfaction & loyalty Reduced land & soil
Increased shareholder degradation
value Increased community
health Reduced emissions levels
Increased market share Increased employee Reduced use of hazardous
Decreased merchandise retention materials
cost Increased employee Increased recycling
Decreased transport motivation Improved responsible use
cost created fair wages of natural resources
Improved conservation
Decreased energy cost provided health care initiatives to repair past
coverage damage
 Risks of only putting focus on economical
accounting
Limit the growth of the organization
Decrease the profits
cause people to die
Case: Pfizer (profits decreased)
violated the Clean Air Act at manufacturing plant in Groton
in 2008 (paid a $975,000 fine)
tested an experimental antibiotic on meningitis-infected
Nigerian children (11 died, others developed brain damage)
 Risks of ignoring social
accounting
Cause unfairness in the workplace
Cause dissatisfaction among the employees
Lose customer loyalty
Case: Nike's Human Rights Abuses in 1990's (destroy reputation)
paid the employees below the minimum wage in Indonesia (14
cents/hr)
forced workers to work overtime for zero pay
 Risks of ignoring environmental
accounting
Fossil fuels are becoming increasingly scarce
Raw materials can be affected by climate change
Natural resources for producing products could be no
longer available

Case: Volkswagen's Emission Scandal in 2015 (costs 1.5 billion)

installed defeat software in its diesel engiens cars
cheated on the emissions tests
 The Application of the TBL
TBL framework can be used in

different entities

different projects or policies

different geographic boundaries

3Ps do not have a common unit of measure.

What Measures Go into the Index?

measures

Economic Measures

Social Measures

Environmental Measures
 Variations of the TBL
Measurement
Economic
Social

Sales, profits, RIO Labor practices

Tax paid
Monetary flows Community impacts

Environmental Human rights

Air quality Products responsiblity

Water quality
Energy usage
Waste produced
Triple Bottom Line - Starbucks Coffee
 Economic Application

2014 2015
Profits:$512.6 million grew to $626.7 million,or
or 34 cents a share 41 cents a share
20% inceaeased

2014
2015
Revenue for the quarter:
Jumped 17.5 percent,
$4.2 billion
to $4.9 billion
 Social Application
Goals Results
2010 2015
25,000 young people to Increased 42% of
engage and innovate in their generations(50,000) to
communities partipate their
communities

2010
Moblize employees and 2015
customers to contirbute 1 24% increaese in
million hours of community service hours
service
 Environment Application Results
Goals
2010 2015
Reduce energy consumption Decreased electricity by
by 25% 1.7%

2010 2015
Purchase renewable energy to Increased purchase of
50% of electricity used renewable energy to 25%
2010 2015
Reduce water consumption Decreased water use by
by 25% 4.1%
 performance
a Fortune 500 company
triple bottom line productivity
over 46,000 employees
efficiency
Profit
People
Provide friendly, reliable & low-
cost air travel (customers)

Provide job-secure environment

(employees)

Donated leather to organizations

Leather seats upcycled into new

products,
 Planet

Biofuel (3 million gallons renewable fuel)

Fuel efficiency (saved 1 million gallons in 2015)

Fuel efficiency (saved 1 million gallons in 2015)

Reduced the weight of each aircraft (600 pounds)

The additional winglets reduced the operation noise
 Conclusion
The Triple
Bottom Line
as changed the
way businesses
Challenges: measure
Equal value to
there is no sustainability
each of the 3ps
universal
rather than
standard
just looking at
method
profit
 References
Dhiman, S. (2008). Product, people, and planet: The triple bottom line sustainability imperative. Journal of Global Business Issues, 2(2), 51-57.

Goel, P. (2010). Triple bottom line reporting: An analytical approach for corporate sustainability. Journal of Finance, Accounting, and Management,

1(1), 27-42.

Norman, W., & MacDonald, C. (2004). Getting to the bottom of triple bottom line. Business Ethics Quarterly, 14(02), 243-262.

Richardson, J. (2016). The definition of a triple bottom line business. Retrieved May 19, 2017, from http://inspiredeconomist.com/2016/03/24/the-

definition-of-a-triple-bottom-line-business/

Richardson, J. (2016). Ten triple bottom line business. Retrieved May 19, 2017, from http://inspiredeconomist.com/2016/03/14/10-triple-bottom-line-

businesses/

Dunbar, M. F. (2015). Southwest is still America's greatest airline. Retrieved May 19, 2017, from https://consciouscompanymedia.com/sustainable-

business/southwest-is-still-americas-greatest-airline/

http://southwestonereport.com/2016/performance/

https://www.southwest.com/html/southwest-difference/southwest-citizenship/environmental-initiatives/
THANK YOU!
Q/A