Most people are already familiar with the First bottom line;
it’s the one that appears at the bottom of your financial statements for the
month; the amount you made or lost as the result of business operations. This
is occasionally derided by the sort of idiots who believe that a world with a
barter economy or a socialist utopia are actually achievable in our time, or
for some reason believe that success in a commercial enterprise is somehow wrong.
I have often pointed out in this space that there really isn’t anything wrong
with turning a profit, providing jobs for your employees, business for your
suppliers, a good return on investment for your stockholders, and offering a
useful product or service for sale – all of these things help worthwhile people
to have better lives and potentially better futures…
I’ve also spoken in this space about the Second bottom line,
although I haven’t usually called it that. Consider for example that if our
company makes money it will contribute to the local economy, both from taxes
paid on income and sales, but also through the amounts it spends on goods and
services and the amounts all of its employees and suppliers (and their
employees) spend on goods and services. This increases the funds available to
the local government, and allows for better police protection, fire service,
public healthcare and education, libraries, parks, and social services, just to
name a few. Some people may dismiss this as nothing more than a side effect, or
complain that the business doesn’t really care about these effects, but I have
to ask: if your community is gaining all of these benefits, do you really care
why the people who own the company are providing them?
The Third bottom line is all about the environment, and
doing business in a way that is environmentally sensitive – or, even better,
has a positive effect on the environment. The best example I’ve ever seen – the
one I teach in my management classes – is a garbage-collection company that
started composting the organic waste it was being paid to collect. Not only did
this keep millions of tons of trash out of the landfills, it also created the
world’s best organic fertilizer (that’s what compost is), which enabled local
farmers to achieve better crop yields while at the same time avoiding harmful
runoff from chemical fertilizer. The farmers made more money, the local water
and air were cleaner, the landfills didn’t fill up as fast, and the company
eventually realized they were making more money selling compost than they were
being paid to collect the garbage in the first place…
Now, I realize that I’m not going to change anyone’s
business philosophy, let alone strategy, with a 600-word blog post. But I have
to ask you to consider a situation where people are paying you to come and haul
away the raw ingredients for your most lucrative product: is that not
beautiful? If you could benefit your employees, your stockholders, your
community, and the whole world while making more money doing so, why would you
not want to do that? The key point of the Triple Bottom Line isn’t that there
is more to life than making money (although there certainly is). The point is
that sometimes doing the right thing and doing the smart thing involve doing
the same things, and it would be a shame to pass up a chance like that –
especially since it’s probably already there, waiting for you to find it…
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