Earlier, we wrote a blog post on California passing legislation creating new business structures for social enterprise. In this post, we’ll discuss what exactly the triple bottom line approach to sustainable business (social enterprise) really is.
Triple bottom line refers to the 3 “P’s” – Profit, People, Planet. It is a term often connected to companies that are actively engaged in eco-friendly policies or community interests. Like any business, a triply bottom line oriented business will focus on generating profits for its shareholders. However, it will also focus on people, often by hiring immigrants or under-served members of the community. Additionally, these companies will focus on providing the most ecologically friendly products and services and conducting business operations in a manner that is as friendly to the planet as possible.
Generally, the triple bottom line makes good business sense. Though, the degree to which companies to proclaim a triple bottom line mission actually execute on the people and planet side of the equation is unique to each company. While incorporating these key words to the company’s mission is a great way to gain support from certain market niches, its important to actually execute these practices so as to not alienate these same market segments.
More information about the triple bottom line principles can be found here.