The very last thing any self-respecting innovator wants to do is to trip up their

innovation just as it goes mainstream. But that is what I did recently—intentionally— with the triple bottom line, a concept that I coined in 1994 and that has since gone mainstream, globally. Among other things, it helped trigger the boom in ESG investment, focusing on environmental social and governance aspects of business performance.

 

The less good news is that the “software” controlling capitalism now includes

millions of algorithms that churn away constantly, out of sight and out of mind, but it also includes the values and assumptions of economists like Milton Friedman. Their focus on financial value has delivered huge rewards for those in capitalism’s driving seats, but also burned through unconscionable amounts of natural, social, and human capital along the way.

 

That was the reality that the triple bottom line was intended to challenge. For those unfamiliar with the concept, this is a management framework designed to examine a company’s social, environmental, and economic impact. In 1995, I followed up with the simplified “People, Planet & Profit.” Together, these terms have been among the more successful new entrants to the business lexicon over the past quarter century. 

 

So why recall them? After all, since the 1990s, the sustainability sector has grown rapidly, though at somewhere between one and two billion dollars in annual revenues globally, it is no giant. Still, market research suggests that future markets for its products and services could be huge, with the UN Sustainable Development Goals forecast to generate market opportunities of over $12 trillion a year by 2030—and that’s considered a conservative estimate.

Meanwhile, however, we have a hardwired cultural problem in business, finance,

and markets. Whereas CEOs, CFOs, and other corporate leaders move heaven and earth to ensure that they hit their profit targets, the same is very rarely true of their people and planet targets. 

 

So, in 2018, I announced what I was told was the first ever “product recall” of a

management concept. Ironically, it was announced in the Harvard Business Review ( HBR ). The irony lies in the fact that, several years earlier, HBR had published its latest ranking of CEOs—and listed Novo Nordisk’s then CEO as the world’s best business leader. Novo Nordisk had been the first large company in the world to formally re-charter itself around the triple bottom line.

 

 

While much of capitalism is becoming more responsible and less destructive per

unit of production or profit, it must now become radically more economically

inclusive, socially just, and—crucially—environmentally restorative. This, in turn,

means rebooting our thinking about profit and profitability.

 

If cancer is life run riot, then plastic-clogged oceans, obscene wealth divides, the

undermining of democracy, and accelerating climate-induced ecosystem collapse are symptoms of our current forms of capitalism running riot. Like it or not, the pangenerational task of containing—and then radically redesigning—capitalism is now our central challenge. 

 

John Elkington is a founder of the modern sustainability movement founding SustainAbility in 1987. Currently, he is Founder and Chief Pollinator at Volans Ventures. His twentieth book, Green Swans : The Coming Boom in Regenerative Capitalism , was published in April by Fast Company Press.

 

 

John Elkington will be speaking on “Why is it Time to Rethink the Triple Bottom Line?” at The Cooler Earth summit on 8 September 2020.

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