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Triple Bottom Line Accounting

72% of businesses believe climate change poses risks that could significantly impact their operations, revenue, and expenditures. As a result of climate change and severe weather patterns, companies are also facing risks in manufacturing, stemming from resource depletion. Managing risks, therefore, necessitates capacity building and developing sustainable strategies with aligned impact measurement.


Businesses have been taking action toward sustainability, including transitioning to renewable energy and adopting eco-friendly packaging. However, while many reports mention sustainability, a significant number of enterprises struggle with benchmarking their sustainable actions due to a lack of evaluation and tracking tools. Sustainable Horizons published an article stating that only 0.2% of corporates have developed methods and tools to evaluate progress toward sustainability goals, such as the United Nations’ Sustainable Development Goals (SDGs). This lack of effective evaluation can lead to actions that contradict their sustainability goals. For instance, a company aiming to reduce carbon emissions may inadvertently continue using single-use plastics due to inadequate assessment methods, which does not align with its sustainability objectives.


Integrating the Triple Bottom Line (3Ps) is a key method for companies to track the effectiveness of their sustainable strategies. Beyond Profit, ‘People’ and ‘Planet’ should also be recognized as critical components of business success. The 3Ps— Profit, People, and Planet—should all be the factors against which business performance is evaluated. One approach to achieve this is through Triple Bottom Line accounting, which translates these 3Ps into measurable figures in financial statements' bottom line. A GREAT example is the Holcim Group, a global leader in sustainable construction, which has been quantifying its economic, social, and environmental impact in monetary terms annually since 2014. By adopting this method, firms can not only assess the impact of their sustainability efforts but also identify the next crucial steps toward becoming truly sustainable and Future-ready businesses.

Setting sustainability goals and initiating actions toward these objectives are undoubtedly what businesses should aim for. However, to achieve better outcomes in reaching sustainable goals, incorporating evaluations into the process is essential. Thus, the Triple Bottom Line should serve as a set of indicators that track progress, enabling significant changes that positively impact People and the Planet.


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