Skip to content

The Triple Bottom Line

2012 July 20

By Amy Miller

Jargon is my nemesis. I rail against it for a living.

But today I will break my own rule because today I want to write about the Triple Bottom Line. I love this concept developed in environmental and overlapping business circles. Basically it says what your mom always told you: it’s not just about the money. And did she also tell you there are no easy answers. It’s about that too.

Like if you hang clothes to dry, you save on energy costs. Plus you extend the life of your clothes. But what about the scratchiness of the towels and your children’s comfort? What about the extra 15 minutes to hang each load. Or when you drive a smaller car to save on gasoline, do you put your children in danger? And now that you can no longer offer rides to other people, how often is another car going and adding to pollution. So many shades of gray.

Well, the triple bottom line, as economists and environmentalists call it, addresses and finally acknowledges – in terms bureaucrats and CFOs understand – that we need to take more than just dollars and cents into consideration when we decide if a new power plant, new box store or boiler system – is worth it.

If paper companies 100 years ago factored in the cost of cleaning the river after it ran red, they may have decided on a different manufacturing system. And if homeowners figured in the cost of dirty lungs and respiratory illness, the $20 price tag on the old wood stove a neighbor is selling might seem a lot higher.

The Economist newspaper said the phrase “triple bottom line” was first coined in 1994 by John Elkington, founder of a British consultancy.” He argued that companies should prepare three separate bottom lines: one for financial profit and loss; one measuring how socially responsible an organization has been; and one measuring how environmentally responsible it has been. Elkington said, the magazine wrote, that “Only a company that produces a TBL is taking account of the full cost involved in doing business.”

Of course the Economist acknowledged how hard this record keeping is. The full cost of a nuclear accident like Three Mile Island cannot really be measured in monetary terms. The cost to society of a lost forest is not quantifiable. The cost of child labor cannot be measured. But the term at least acknowledges the need to account for each of these costs

About the author:  Amy Miller is a writer who works in the public affairs office of EPA New England in Boston. She lives in Maine with her husband, two children, seven chickens, two parakeets, dog and a great community.

Editor's Note: The opinions expressed here are those of the author. They do not reflect EPA policy, endorsement, or action, and EPA does not verify the accuracy or science of the contents of the blog.

Please share this post. However, please don't change the title or the content. If you do make changes, don't attribute the edited title or content to EPA or the author.

3 Responses leave one →
  1. Ernest Martinson permalink
    July 22, 2012

    The triple bottom line could collapse to a single bottom line with fiscal reform. For triple example:

    Drying clothes on the line could save money as well as energy if coal subsidies were replaced with carbon taxes. Cheap coal is converted to cheap electricity energizing an appliance with energy conversion efficiency decidedly inferior to that clothes line. Just be careful it is not a hemp line in order not to provoke a swat team. And fifteen minutes in the sun to hang each load should not be shunned. It could eliminate the need for going nowhere on an indoor treadmill.

    I suppose children could be protected if driven around in a military tank. And this could be be a teaching moment if a child asks why gas is so cheap and why other children in other lands are considered collateral damage. But alternative modes of transportation, not limited to small cars, could be better for the bottom line if crude oil subsidies were replaced with carbon taxes.

    The reluctance to measure the full cost of a nuclear accident in monetary terms is understandable given the history of nuclear power. Utilities refused to buy into nuclear electricity until the full cost of a nuclear accident was lifted from their unwilling shoulders with the Price-Anderson Act. The latest denial of measuring the cost of nuclear power in monetary terms is the offering of federal guaranteed loans to nuclear power construction in Georgia.

  2. July 30, 2012

    No matter who much we deny it, but cutting the cost becomes a hidden consideration whenever we are doing something big. Somewhere deep down we are thinking about the costs too!

  3. Louise permalink
    October 23, 2012

    It is really an informative one. It is really true that the major bottom line is that.

Leave a Reply

Note: You can use basic XHTML in your comments. Your email address will never be published.

Subscribe to this comment feed via RSS