It’s an important question to answer and often reveals how an organization measures its success. The reason I inquire is because someone recently asked me if I could identify Sage customers (specifically nonprofit or government organizations) who measure their triple bottom line. And, while I am confident we have customers who report outcome measures that reflect the concepts of the triple bottom line, I am not sure how widespread adoption of the framework is in our community.
The “triple bottom line” also known as TBL or 3BL began as an accounting framework to capture the full cost of doing business and as a guide for companies to report on the sustainability of their business practices.
The triple bottom line measures a company’s performance in terms of three bottom lines: profit, people and the planet.
- A single bottom line measures “profit” the fiscal or economic performance of an organization, profit and loss at the end of the year.
- A second bottom line measures “people” the social impact of an organization, how well does the organization treat people within the organization, throughout their supply chain and in the communities they touch.
- A third bottom line measures “planet” the environmental responsibility of an organization or their ecological impact locally and globally.
Is Triple Bottom Line for Business Only? 3BL can be adjusted to fit any organization. Nonprofits and government entities can use 3BL by establishing outcome measures that report their economic, social and environmental performance.
Nonprofits can report “profit” as revenue generated or funds raised. “People” as number of constituents served. Environment as resources recycled or even the amount of green energy purchased each year. How 3BL is implemented really depends on the organization. There is an excellent article here on the Indiana Business Review that explains the concept of triple bottom line in more detail and provides examples of measures your organization can use.
Does your organization measure the triple bottom line? Let us know by commenting below.