Sustainability is a driving factor for many companies, however understanding how to measure and achieve sustainability has proven to be extremely complex. In 1994 John Elkington coined the phrase “people, planet, profit” at SustainAbility. This concept of the triple bottom line is now found in nearly all discussions of corporate sustainability. And while the newly commissioned sustainability executive will proudly tout their implementation of “people, planet, profit; I can’t help but feel they are missing the real solution.
The triple bottom line follows the belief that a business should account for and take inventory of environmental impacts and social impacts while maximizing financial gains. Inherently there is a constant struggle to justify the financial costs of environmentally sustainable solutions, and improving the community comes at a price as well. Inevitably all sustainability managers find themselves with ideas and solutions to improve people and planet, but without justification to implement these solutions because of the impact on profit.
The problem is that we need a fundamental shift in the understanding of the purpose of business and what “people, planet, profit” really means. Only then can these three aspects work together seamlessly.
Some believe the purpose of business is to make money – profit. The butcher makes money selling meat, the chef makes money cooking meals and the builder makes money buying houses. While each of these businesses could make a profit, this is not the purpose of business. If consumers don’t want meat, cooked meals or new homes, those businesses will never survive. The only way a business remains is if it provides a value to the community.
Obviously these are simplistic examples, but the overall perspective is the same. The purpose of business is to provide value. Value to the people, value to the planet.
Profit on the other hand is not a value provided. Profit is what you get in exchange.
In a truly sustainable business, “people, planet, profit” is not a triple bottom line – it is a math equation and it looks like this:
People + Planet = Profit
The profit is an inherent result of providing value to the people, value to the planet. In a sustainable business, profit should never exceed value, nor should it be less.
Perhaps the solution to the bottom line is simply creating a balance between the value you provide to people and planet, and the value you receive in return as profit?