Changing Business Responsibilities: Measuring the Multiple Bottom Line

Long considered impractical and irrelevant, measuring business’ sustainability is increasingly possible, demanded, mandated, and central to business competitiveness (Environmental Resources Management, 2020; Porter, 2013). Several driving trends are transforming business responsibilities, including purpose, transparency, sustainable finance, climate change, and a changing workforce. Grounded in business strategy theory, the onus is on businesses to deliver both profit and societal contributions.

From CSR to Creating Shared Value

Traditionally, the classical model of Corporate Social Responsibility (CSR) emphasizes a primary fiduciary responsibility to prioritize shareholder interests above all (Elkington, 2018). However, the modern business environment is rapidly evolving. Shareholder value is no longer the singular goal but is the outcome of a broader set of responsibilities. Porter and Kramer's (2011) concept of Creating Shared Value (CSV) exemplifies this shift, emphasizing both profitability and societal contribution.

The Role of Transparent Leadership

A sustainable strategy requires transparent leadership, both in vision and execution. Leaders today have the mandate to instill a sustainable culture within organisations, ensuring alignment with broader societal goals.

The Rise of Sustainable Finance and ESG Reporting

Sustainable finance is gaining momentum, with increasing emphasis on Environmental, Social, and Governance (ESG) reporting (MacMahon, 2020; Subramanian, 2020). With the evolution of robust metric frameworks, businesses are encouraged to adopt sustainable practices and showcase their commitment to broader stakeholders.

A Focus on Sustainable Development Goals and Human Capital

In the current pandemic recovery environment, there's a heightened focus on Sustainable Development Goals (SDGs) and human capital investment (Organisation for Economic Co-operation and Development, 2020; World Economic Forum, 2021). The workforce's expectations are changing, necessitating businesses to adapt, evolve, and invest in their most critical asset—people.

The global emphasis on business sustainability, bolstered by the Multiple Bottom Line (MBL), is a call to action for businesses to be accountable based on their economic, environmental, social, and cultural obligations (Hill & Hult, 2018). In an era of uncertainty and shifting market dynamics, businesses prioritizing long-term growth for all stakeholders will thrive. The movement towards a more sustainable economy is not just a mandate; it's in the best interest of businesses.

Call to Action

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References

- Elkington, J. (2018).

- Environmental Resources Management. (2020).

- Hill, C. & Hult, G. (2018).

- MacMahon, P. (2020).

- Organisation for Economic Co-operation and Development. (2020).

- Porter, M. (2013).

- Porter, M., & Kramer, M. (2011). Creating Shared Value.

- Subramanian, R. (2020).

- World Economic Forum. (2021).