A social enterprise aims to achieve a triple bottom line (TBL) by implementing ethical social and environmental practices and policies, while still maintaining economic benefits. People. Planet. Profit.
Most socially aware enterprises want to implement every positive social and environmental initiative possible. But some initiatives can be costly, and maintaining the economic benefit – profit – is crucial for the company to survive. The reality is that a company may not be able to implement everything on its wish list. On top of this, what may be a great program for one company, could be detrimental to another.
With working capital issues and, often, high costs of such projects, social enterprises need to choose their initiatives carefully. That’s where the money side of TBL comes into the equation. This two-part article will give a general overview of how a social enterprise can gauge and prioritize which projects it can take on to maintain all three legs of the triple bottom line.
Part 1: DESIGN
Step 1: Design the company’s TBL policy guide
Start by getting everyone on the board (whether that’s just you or an entire boardroom table) to create a cohesive company-wide TBL policy.
What values are important to the company pertaining to your environmental and social policies? What are your long-term goals for environmental and social values over a 10-year period? Many times, the value of these policies cannot be realized in the short-run and must be looked at over a longer time horizon of 10 years.
Next, assess what the long-term economic goals and constraints are for the company. Social and environmental policies should serve as the company’s long-term guide, while the economic constraints act as the reality check.
Step 2: Find out which initiatives will bring you in line with each policy in the guide
Take part in a sustainability audit, whether internal or external. The company needs to take a hard look at where its current practices align with the newly created TBL documents.
Make a list of all potential initiatives the company could undertake in order to meet the policy goals outlined in the overall strategy. It doesn’t matter how big or how small the initiative is, write it down!
Let’s take a small air pollution control company that wants to improve its triple bottom line. After the board of directors outlines their TBL policy guides, they have their company assessed for sustainability. From the assessment, the following initiatives are suggested. Each initiative should improve one specific aspect of the triple bottom line.
• Install low-flow water taps to reduce water use
• Install more doors and windows to improve air quality
• Create unpaid intern contracts to reduce overhead
• Invest in automated conveyer belts in the plant to increase production
• Get a company-wide health benefit plan
Implementing all of these could be wonderful, but the company can’t afford to do them all.
Join me for part two of this column to see how this company is going to prioritize and choose which initiatives will best help it attain a triple bottom line.
Shannon Lee Simmons is a financial consultant, speaker, media personality, financial journalist and social change advocate. She founded Primary Financial and The New School Of Finance.