The triple bottom line considers the different types of impact which can be produced, to varying extents, by business enterprises. They are:
The three dimensions identify the diverse but highly interconnected components of sustainability. Businesses are challenged to produce all three types of value if they want to be sustainable economically, environmentally and socially. For example, failure to protect natural resources creates barriers for social inclusion by destroying the conditions for accessing the life needs of people.
Failure to pay fair wages in order to accrue profits equally fosters marginalisation and social inequality. The figure below shows the intersections between areas of sustainability. This suggests that economic, environmental and social elements of business activities are not separable aspects when assessing the effects or societal impacts of entrepreneurship and innovation.
You have already read the Levi Strauss case study, which addresses the impacts generated by washing jeans, both for specific stakeholders and for the wider community.
The triple bottom line became popular following a series of corporate, unethical practices which destroyed social and environmental value in order to maximise profits. The idea of the triple bottom line is that businesses should pursue economic sustainability together with environmental and social sustainability. In particular the term tripple bottom line refers to three interlinked bottom lines that a sustainable enterprise pursues:
Allow about 15 minutes
The Levi Strauss case study that you read earlier addresses the impacts generated by washing jeans, both for specific stakeholders and for the wider community. Now apply the triple bottom line framework to the case study.
As you re-read the case study, make notes on the following questions:
The case study identifies several examples of indicators that can be used to answer these questions and you will no doubt have identified many of them. Some examples under each of the three components of triple bottom line include:
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