Talk:Triple bottom line

From Wikipedia, the free encyclopedia
Jump to: navigation, search
WikiProject Business / Accounting  (Rated Start-class)
WikiProject icon This article is within the scope of WikiProject Business, a collaborative effort to improve the coverage of business articles on Wikipedia. If you would like to participate, please visit the project page, where you can join the discussion and see a list of open tasks.
Start-Class article Start  This article has been rated as Start-Class on the project's quality scale.
 ???  This article has not yet received a rating on the project's importance scale.
Taskforce icon
This article is supported by the Accounting task force.
 
WikiProject Environment (Rated Start-class)
WikiProject icon This environment-related article is part of the WikiProject Environment to improve Wikipedia's coverage of the environment. The aim is to write neutral and well-referenced articles on environment-related topics, as well as to ensure that environment articles are properly categorized.
Read Wikipedia:Contributing FAQ and leave any messages at the project talk page.
Start-Class article Start  This article has been rated as Start-Class on the project's quality scale.
 ???  This article has not yet received a rating on the project's importance scale.
 

Untitled[edit]

It might be good to start the article with a statement about where the term Triple bottom line orginates from. This is what I found at [1]:

"The phrase was coined by John Elkington, co-founder of the business consultancy SustainAbility, in his 1998 book 'Cannibals with Forks: the Triple Bottom Line of 21st Century Business'. In its broadest sense, the triple bottom line captures the spectrum of values that organizations must embrace - economic, environmental and social. In practical terms, triple bottom line accounting means expanding the traditional company reporting framework to take into account not just financial outcomes but also environmental and social performance."

There is no clear definition of the Triple Bottom Line (3BL) concept.

That seems false. ICLEI has extremely specific definitions and guidelines that long ago superceded any 1998 definitions. Certainly if you are using it as a proper noun Triple Bottom Line then you absolutely are referring only to well defined ICLEI concept and this framework [2]
— Preceding unsigned comment added by 24.89.204.176 (talk) 23:51, 1 April 2013 (UTC) 

Here's the following which I am translating from Ukrainian from a newsletter of this resource: http://www.corporate-citizen.org.ua:

Companies should take measures not only to create economical added value, but also be constantly aware of the social and ecological "added value", which they are creating or destroying.The 'people, planet and profits' formula, first used by Shell in their first social responsibility report, is now wiedly used in business.

Reporting TBL is more important than individual outcomes[edit]

It's interesting that all of the arguments against TBL listed in the article focus on the net value above the bottom line (i.e. 'profit' in the case of the financial bottom line), not on the importance of the reporting itself.

It is okay, utilizing agreed upon reasoning and justifications (which are always situational and dynamic), for particular entities to display deficits within certain bottom lines (e.g. the Red Cross showing no profit, or an oil company in 2005 showing a net deficit in greenhouse gas emissions), however availability of this information to shareholders, contributors, members of voluntary organizations, the general public, etc., to enable informed decision making (just as in financial reporting), is the crux of TBL.

"Arguments Against": Food for Thought or Discussion[edit]

From the article's "Arguments Against" section: "Effectiveness. It is observed that concern for social and environmental matters is rare in poor societies (a hungry person would rather eat the whale than photograph it). As a society becomes richer its citizens develop an increasing desire for a clean environment and protected wildlife, and both the willingness and financial ability to contribute to this and to a compassionate society. Indeed support for the concept of the 'Triple Bottom Line' itself is said to be an example of the choices available to the citizens of a society made wealthy by businesses attending to business. Thus by unencumbered attention to business alone, Adam Smith's Invisible Hand will ensure that business contributes most effectively to the improvement of all areas of society, social and environmental as well as economic."

While there is obviously some truth to this, what I believe this argument overlooks is that the mentioned "richness" (and clean-ness, and willingness and financial ability) of developed, rich nations is often secured by, and possibly dependent upon, resources coming from lesser-developed nations. For one thing, these resources may be less depleted than in a longer-developed rich nation; for another, the need within the poorer nations may be such that they will sell their labor, resources, and productive capacity cheaply. Though this often desperate, highly competitive market participation on the part of poorer nations benefits rich nations in terms of cheaper raw materials and consumer goods (and provides jobs in the poorer nations), it very frequently contributes to the poor social and environmental conditions in the poorer nations. So aren't these social and environmental "conditions" in the poorer nations often the "externalized costs" of the richer nations? I don't believer this figured into Adam Smith's thinking... or am I wrong?--Joel Russ 22:10, 4 August 2006 (UTC)

The truism that as a nation becomes wealthier, they become ecologists, ignores the fact that everyone, no matter how poor, basically wants a healthy ecology. The process of "creating wealth" is based on consuming the natural resources, using fuel and chemicals to modify those resources, and thus polluting the ecology. Simultaneous with the rise of "wealth", people become conscious that the process creates pollution, and then demand that the pollution be controlled. Likewise, they demand workers' rights. Eventually, they start to realize that all this development was enabled by their governments' participation in a neoliberal compacts with the North, and demand a cessation of neoliberalism. That little phrase that Americans say, about poor nations becoming wealthier, and then going eco, is pure neoliberal smoke-and-mirrors to hide the fact that it's pollution and so-called "development" that's causing the pollution, and that's inspiring ecological revolt. 66.245.194.238 17:47, 28 May 2007 (UTC)

Nationalism might be good, if the Nation does not only take care of its own people first, but also of its own nature. Nationalism is often helpful in the absence of proper laws dealing with globalisation, multi-national companies, carelessness or intentional damage.

Nationalism today means responding to the issues of "citizens" while issues concerning everyone else outside the country (and often, non-citizen immigrant) are ignored. That is unsustainable, because the costs of pollution, health, and natural resource conservation can be externalized. 66.245.194.238 17:47, 28 May 2007 (UTC)

The "Arguments against" section needs work. It seems odd that the deep conceptual criticisms are not noted. There is at least one scholarly criticism (MacDonald & Norman) in a top-ranked peer-reviewed journal, yet the criticisms in that article are absent here. I can't add it myself, of course, without violating Wikipedia norms about conflict of interest. —Preceding unsigned comment added by Chrismacd (talkcontribs) 19:52, 28 February 2009 (UTC)

The 'Arguments Against' Section actually just looks like a bit of a rant. It's original research, someone's personal opinion on the subject. I'm sure there's some of the views expressed in the section have been expressed elsewhere but unless they haven't, why do we have this section? 188.220.169.56 (talk) 11:31, 1 January 2011 (UTC)
I agree, the "arguments against" section is windy, unbalanced, and far too long.Billyshiverstick (talk) 02:43, 30 August 2013 (UTC)

This section does not cite anything, and is clearly biased. I've just noticed it has been like that since 2006! I'm just going to delete the uncited bits, it's not encyclopaedic, its (as other people have said) a bit of a rant. Apologies if this isn't the correct procedure, but revisions are stored aren't they? And if it has been a problem for 8 years, spreading potentially false information, that seems like it won't be fixed any time soon to me.

for instance "business should not be expected to take on concerns outside its core expertise, provided the business doesn't do obvious harm to people or the planet." what is obvious harm? Whose opinion is it that subtle harm is okay? As has been said above, businesses work outside their core competencies all the time. Does doing this harm the business? "Adam Smith's invisible hand will ensure that business contributes most effectively to the improvement of all areas of society, social and environmental as well as economic." That theory is hundreds of years old, I'm no economist, but surely there has been some critical discussion of this. Didn't Adam Smith himself think focusing on pure economic efficiency would turn people into drones? Not sure what the nationalist bit is referring to. Smileperegrine (talk) 16:11, 14 March 2014 (UTC)

Article's quality[edit]

I think this article contains some outdated notions. for example:

1) some of the "arguments against" miss the point on TBL: a) the problem with "force businesses to take responsibilities outside their area of expertise" or "business should not be expected to take on concerns outside its core expertise." is that every business does take responsibilities outside their area of expertise. Business have the responsibility to keep their books in order, and they can do it with an in house or external accountant. Same goes for being socially and environmentally responsible: there a guidelines, and certifications available to help a business choose the best way to minimize its impact on the environment and there are also VERY traditional standards to help business decide what constitutes fair working standards. TBL proposes an EXTENSION of these responsibilities related to non-core activities. It does not propose that businesses replace their core competency with profit + how to be good to the environment + how to be fair to workers. it is asking businesses to be good to the environment + be fair to workers in your pursue of profit. b) "it makes it difficult for businesses to recognize the benefits of using TBL for the company, itself" TBL is not about benefiting the company itself - it is about benefiting the world we live in. it looks to bring some responsibility for the common good into the character of the corporation.

2) the "Arguments in favor" section doesnt mention the major traditional economists who have sided with TBL. it mentions TBL as an idea of the fringe "green party" crowd.

3) I believe it is a very poor article as it stands. It confuses the MEASUREMENT issues (which are rapidly becoming of greater interest to many organisations)with the POLITICAL issues of who should do what. It fails to mention capturing the cost of externalities (one of the main objectives of TBL) but talks of getting a "free ride" (which is politically charged). It describes what "TBL companies" will not do (such as overfishing and destruction...) implicitly excluding the exploitative industries from the measurement process. All activities should be capable of applying a rigourous TBL process. If the Hicksian principle of economic capital maintenance is the basis for calculating "profit", then it would be conceptually consistent to apply the same principle to the maintenance of society and the environment. However, many problems exist around defining and measuring social capital and environmental capital. There is room for an article along these lines, discussing the many practical difficulties of MEASUREMENT. Please remove the emotional and political language that hinders serious attempts to develop objective TBL metrics. —Preceding unsigned comment added by Wikid4change (talkcontribs) 11:30, 26 August 2009 (UTC)

This being a wiki, "please do this" requests are frequently not acted upon. It's often more expedient to make the changes yourself. --Cybercobra (talk) 11:37, 26 August 2009 (UTC)

Criticisms are poorly thought out at best[edit]

"Support for the concept of the triple bottom line itself is said to be an example of the choices available to the citizens of a society made wealthy by businesses attending to business." This statement makes a huge assumption that old structures remain necessary. In science, older models acted as the scaffolding for new models. The old models were factually wrong. An atom doesn't look the way we were taught in high school, physics isn't completely deterministic, thermodynamics is just a crude approximation, etc. Just because this old method worked for a while, doesn't mean it's correct, and doesn't mean it's where we should settle.

The environmental and economic fallout from our current mode of doing business is logically clear. The practices encouraged by the TBL model would sidestep many of the current ills that are making increasingly more trouble for us here in America. Companies don't tend to offer comprehensive, matched retirement plans anymore, which greatly decreases employee loyalty in these enterprises, and tends to lead to lower quality from there. Less employee loyalty means lower quality for everyone. It seems to guarantee higher turnover rates, which means that more time is wasted on training new employees (for example). The current attitude encourages waste and inefficiency, which should be something that every company strives to minimize.

Similar to their unwillingness to treat their workers well, large companies often hire large teams of lawyers to find and exploit loopholes in tax law so that they can pay significantly lower taxes than they should owe. This decrease in tax revenue is making it harder and harder to maintain, let alone expand, our nation's infrastructure. Whether you're talking about maintaining roads, levees, schools, or any other publicly-funded project, the results are the same. By weaseling out of paying taxes, they are failing to support the infrastructure that has been essential in supplying them with skilled workers. This has lead to high-tech companies hiring skilled workers from other nations because American workers don't have the skills/attitude desired.

Simply put, to believe that our economic systems don't affect our social and environmental systems is completely naive, and in clear denial of reality. If they're linked in reality, then those organizations need to be required to behave as though they are. —Preceding unsigned comment added by 69.181.234.27 (talk) 16:08, 10 November 2009 (UTC)

UN and ICLEI Citations[edit]

Article says "With the ratification of the United Nations and ICLEI TBL standard for urban and community accounting in early 2007, this became the dominant approach to public sector full cost accounting," but I can't find any reference on the United Nations or the ICLEI site to substantiate the claim of such ratification. Can anyone else? —Preceding unsigned comment added by Whitaksm (talkcontribs) 23:43, 8 August 2010 (UTC) I didn't find the direct source saying it, but did find a UN paper from 2011 stating it in paragraf 37. http://www.unep.org/delc/Portals/119/industrryRoleOfIndclean.pdf is that good enough as a source? Anyway have posted it now.

Criticisms: Missing Citations[edit]

Notice that the criticism section is entirely without citations, contrary to Wikipedia policies.

If that section is going to be done properly, someone is going to have to dig up published criticisms. Otherwise that section is liable simply to get deleted. Ethicsblogger (talk) 23:27, 17 February 2011 (UTC)

CRITCISM SECTION: "The concept of a triple bottom line, while initially attractive, seems to ignore the reality that if one is not adding value to society it is subtracting value." This is based on a zero-sum conception of value, and neglects to define the concept of value being used in this statement. — Preceding unsigned comment added by 99.99.246.135 (talk) 13:12, 19 April 2014 (UTC)