in this video I want to answer the question what is the triple bottom line [Music] the idea of the triple bottom line was coined in 1994 by John elkington the founder of the UK based consultancy sustainability he later described the triple bottom line in his 1997 book cannibals with forks the triple bottom line of 21st century business elkington suggested that we need to move beyond the single profit-based measure of companies performance as well as measuring our success in a profit account we should also measure our success in a people account and a planet account that
is the triple bottom line takes into account people and Planet as well as profit we measure our performance on economic social and environmental measures since 1994 some businesses some organizations have chosen to use the triple bottom line to measure their organizational performance this gives them a broader and more holistic assessment of their businesses value both to its shareholders and to its Society the triple bottom line offers private Enterprises a new way to measure their goal of sustainable growth against measures that go beyond profit alone we might consider that for an organization to be considered sustainable
it must be financially secure minimizing its environmental impacts and enhancing the community around it people planet and profit are often represented as three overlapping Circles of concern Each of which represents a different stakeholder in the organization itself profit represents the economic imperative to serve shareholders and owners their concerns are for monetary reward and growth of capital this is of course the traditional bottom line that accountants have long measured and evaluated people represents the stakeholders within the organization's wider community this is about the organization's Corporate social responsibilities and it represents a need for social equity Planet
sees the Earth itself as a stakeholder in an organization's business this part of the triple bottom line represents an organization's responsibility to the natural environment around us what is the part that an organization can play in our shared responsibility the stewardship of our planet the intersections of these three overlapping circles also represent important Concepts the intersection of profit and people represents an equitable way of doing business a fair approach that values people and profit equally this is often described in terms of morality or business ethics therefore it's an ethical and moral framework that we need
to create to drive business decisions the overlap of profit and planet represents the long-term viability of the business organizations need to operate within and draw from a closed system that is our planet so can they do this in an efficient manner that will not in the long term deplete the system so much that they can no longer operate as a result companies need to be frugal in their use of natural resources and find a way to put back what they draw down upon the intersection between people and Planet represents the well-being of the people who
live within the communities within which our organizations operate organizations need to ensure that our planet can continue to provide a bearable environment within which people and communities can thrive the triple bottom line is a simple way of understanding the different responsibilities that organizations have both to their shareholders and to The Wider public it represents three competing but equally important dimensions of people profit and planet and organizations that find the right way to balance these will thrive in the long term and win the support of the communities within which they sit [Music] please do give this
video a like if you've enjoyed it or learned from it I'll be making loads more great management courses videos for you so please do subscribe to the channel and hit the notification Bell so you don't miss any of them I look forward to seeing you in the next one and in the meantime keep learning
