In this lesson, you’re expected to learn about:
– sustainable development
– corporate sustainability
– the concept of Triple Bottom Line

Sustainable Development and its Three Pillars

The modern concept of sustainable development was defined by the 1987 United Nations Brundtland Commission‘s report as “development, which meets the needs of current generations without compromising the ability of future generations to meet their own needs.”

As the concept evolved, it has shifted to focus specifically on three pillars: social justice and equity, economic development, and environmental protection for future generations.

Reflecting on this trend, many corporations and businesses nowadays have developed new business models that include sustainability both in their long-term strategies and in their daily operations.
[Optional] The Three Pillars of Corporate Sustainability
Corporate Sustainability

Corporate sustainability is a business approach that takes into consideration every dimension of how a business operates in the social, cultural, and economic environments. It aims at the creation of a greater business value which fosters the long-term corporate development.

It is a fact that corporate growth and profitability usually cannot be improved without directly or indirectly destroying the environment.

However, the contemporary society increasingly requires corporate entities to pursue the so-called “green” and social strategies, specifically maintaining the conditions under which humans and nature can exist in productive harmony to support present and future generations.
Companies worldwide are looking inward to focus on changes that must be made to fulfil environmental needs and outward to understand their environmental and social impacts.

As a consequence, many organizations have adopted the “Triple Bottom Line” (TBL) as an accounting framework to evaluate their performance in a broader perspective, which considers both financial and non-financial terms.

[Optional] Sustainability
Watch this short 2-minute animated video about sustainability:
The concept of the Triple Bottom Line (TBL) was developed in the late 1990s and, increasingly, it has been applied by corporate entities worldwide. According to it, financial business goals are inseparable from the societies and environments within which they operate.

While short-term economic gain could be chased, a failure to account for social and environmental long-term impacts would make those business practices unsustainable.

TBL is an accounting framework with three pillars: social, environmental (or ecological), and economic, which are informally referred to as people, planet, and profits. Thus, it goes beyond the traditional measures of profit, return on investment, and shareholder value to include environmental and social dimensions.

The concept has evolved and it has also been extended to encompass a fourth pillar, meaning a future-oriented approach(future generations, intergenerational equity etc.).

[Optional] The Triple Bottom Line: What Is It and How Does It Work?
Check out this Indiana Business Review article to learn more:
Sustainability Initiatives

Corporate sustainability encompasses actions from the entire supply chain, requiring accountability from the primary level, through the suppliers, all the way to the retailers.

On the other hand, it positively impacts all of the companies’ stakeholders – i.e., employees, suppliers, community, non-government organizations etc. It strengthens their relationship, which in turn will help the company to meet its business objectives.

Examples of corporate sustainable initiatives that can be reflected in the TBL framework are:

 Environment: energy efficiency, limiting production of waste and toxicity, reduction of greenhouse gas emission, restoration of local agriculture etc.

 Innovative products and services: implementation of new creative ideas to change products and services towards less waste production, and development of new solutions that improve recycling.

 Human capital: improvements of workers’ rights, working conditions, eradication of child labor, slavery, human trafficking etc.

• Collaboration: formation of networks with partner companies which facilitate knowledge sharing to accelerate innovation.

It is important to highlight that most of these measures reduce costs and increase profits.

Consequently, it adds value to the business, environment, consumers, community, shareholders and employees, thus creating long-term businesses.

B Corporations

The TBL trend in the corporate environment has fuelled the emergence of a new organizational form: the “Certified B Corporation”.

The so called “B Corps” are for-profit companies certified by the non-profit B Lab to meet rigorous standards of social and environmental performance, accountability, and transparency.

According to B Lab, today there is a community of more than 1,600 Certified B Corps from 42 countries and over 120 industries.

[Optional] B Corps: For People, Planet, and Profit | Talks at Google
Take a look at the first 2 minutes of this video about B Corps:
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