Sustainable Practices and the Triple Bottom Line: People, Planet and Profit

31st May 2019

Rachel Grace | Sustainability

When defining sustainability, many minds might jump to the idea of ecological sustainability – satisfying the needs of present generations without affecting the ability of future generations to fulfill their own needs. However, the environment and the natural resources it provides do not exist within a vacuum; there are people on this earth, and they tend to extract the resources on it. Because of this, a sustainable future only exists at the intersection of these three elements: planet, people and profit.

Sustainable Practices & the Triple Bottom Line

By Rachel Grace (@rachelmariegrace

I recently returned from a study abroad program that explored this concept intimately (Discover Abroad at the University of Georgia, go check them out!). We specifically focused the Triple Bottom Line (TBL), a theoretical framework that encourages the consideration of environmental, social and financial performance when developing sustainability. This may be at individual, corporate or national levels.

Money over everything (with a cost)

You would think that taking all three of these basic values into account when determining the success of an entire nation or company would be commonplace, but of course, that’s not the case.

In deciding whether someone is “successful,” economic progress takes priority. As a result, financial success takes precedence over social and environmental developments. This has led to many of the social and environmental issues plaguing our earth today.

Gross Domestic Product: An un-holistic measure of progress

The universally accepted measurement of a country’s overall success and wellbeing is Gross Domestic Product, or GDP. However, GDP is the total market value of goods and services produced by a nation over a certain period of time. It doesn’t consider other factors of success (such as education and healthcare), and it was never meant to be used as a comprehensive measure of a country’s welfare, progress or success in the first place.

There are many benefits to having a high GDP, such as more job opportunities and increased access to goods and services. However, it is an averaged measurement, one that only accounts for the economic prosperity of a country. GDP measures the one “P” in the triple bottom line – profit – and it obscures or flat out ignores many issues in a society. Examples include the income gap between the rich and the poor, the environmental impacts of conducting business and the happiness of a country’s citizens.

Success beyond profit

It’s clear that GDP doesn’t fit the bill when it comes to developing a sustainable future. But if that’s the case, what else do we need to examine?

One major concern correlated with increased economic success is having a higher Ecological Footprint (EFP). The impact of a person or community, expressed as the amount of land required to sustain their use of natural resources, is an EFP. Having a higher EFP will result in the destruction of natural habitats, extinction of species and depletion of natural resources. (Developed countries and wealthier families = larger EFP. Developing countries and lower socioeconomic families = smaller EFP.)

Graph showing the relationship between EF and GDP, from marinaecology.wordpress.com

A holistic measurement of progress should also take gender equality into account. If an entire half of the population (typically – and it pains me to write this – women) isn’t succeeding, then how can a country expect to succeed as a whole?

A successful country must have low instances of gender-based violence, teen pregnancy rates and equal access to healthcare and education resources for all genders. The EU predicts that increased gender equality will generate 10.5 million additional jobs by 2050.

Universal healthcare and education access in general should also be considered, as it is something that directly affects a countries economic and social wellbeing. Healthier people = a happier and healthier workforce. Early childhood care can also prevent future social costs, including welfare dependency, health issues, and crime rates. A higher GDP can improve this, but it does not measure it. The US has worse healthcare access and education rankings than other countries (such as Finland and Switzerland), but still has a higher GDP.

But if GDP isn’t going to cut it anymore, what are our other options?

The Happy Planet Index: A holistic measure of progress

One of the most popular alternative measurements of national success is The Happy Planet Index (HPI). The HPI ranks measures sustainable wellbeing in a holistic sense and tells us how well nations are doing at achieving happy and sustainable lives.

The primary tool used to measure success is wealth. However, the countries who rank highest in GDP could be lacking in certain categories. These categories could be gender inequality, their ecological footprint and the general health or well-being of their citizens.

The Happy Planet Index analyzes other indicators of success, besides economic prosperity including:

  • Well-being (how satisfied the residents of each country say they feel with life overall)
  • Life expectancy (how long citizens are living)
  • Inequality of Outcomes (The inequalities between people within a country. May include how long they live and how happy they feel, based on each country’s life expectancy and wellbeing data)
  • Ecological footprint (The average impact that each resident of a country places on the environment, based on data prepared by the Global Footprint Network)

The equation they use to calculate a countries HPI is: (well-being x life expectancy x inequality of outcomes) / ecological footprint. Using this kind of measurement could help a country determine what parts of the TBL they need to improve on.

Comparing and Contrasting Countries: GDP vs HPI

Now, let’s compare just how different the outcomes of GDP are to that of the HPI:

Top 5 Countries with the Highest GDPs: US, China, Japan, Germany, UK

Top 5 Countries with the Highest HPIs: Costa Rica, Mexico, Columbia, Vanuatu, Vietnam

There is absolutely no overlap between either of the two categories. But let’s focus in on the top country for GDP (US) and the top country for HPI (Costa Rica). The US comes in at 108 for HPI, while Costa Rica is ranks 73rd for GDP.

Why did US rank so poorly on the HPI?

The US actually ranks quite high in the categories of wellbeing, life expectancy and equality. However, America ranks astonishingly low in the ecological footprint category. It would take 4 earths for everyone in the world to live like the average US citizen – this is clearly not a sustainable way to live and is something that affects the wellbeing of people around the world. Another issue brought up in the report is that 1 in 6 Americans lived below the poverty line, which is considerably high for a developed country.

Why did Costa Rica rank highly on the HPI?

Costa Rica has an incredibly low ecological footprint and long life expectancy; these two factors alone gave their ranking a major boost. Costa Rica also has many unique policies that has improved the happiness and overall wellbeing of its citizens, such as abolishing its army in 1949, and reallocating those funds to be spent on education, healthcare and pensions. Costa Rican is also known for its culture of supportive social networks between friends, families, coworkers and neighbors – social connections are typically an important component for individual happiness.

However, the HPI is not without flaw. It doesn’t account for many issues in society, for example, homicide rates. The average homicide rate in the US is 4.9 per 100,000 people, compared to global rate which is 6.2. Colombia, however, is significantly higher – 24.75 per 100,000 people. Despite this, Columbia is ranked third in the HPI. Of course, the GDP doesn’t measure homicide rates either!

Utilizing the TBL to sculpt a sustainable future

Studies show that beyond a certain GDP per capita ($70,000 for the US) happiness begins to level off, and the correlation between wealth and happiness weakens. Economic prosperity alone doesn’t necessarily mean a better life for citizens. Even in countries that are already developed or considered wealthy! And economic success is almost at the cost of ecological depletion.

We continue to use money to measure success at all levels, even though we face such incriminating data. Changing the national measure of a country’s success might seem like a great feat. However, the TBL was meant to be used as more than just an accounting framework. It is an individual mentality, a willingness to consider your impact of your actions and balance all aspects of your life.

The Triple Bottom Line is the foundation in which we can build a more sustainable future ecologically, socially AND economically. But it all starts with you! How do you plan to live a more sustainable life today?

Comment below and thanks for reading!

Rachel Grace

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About Rachel Grace

Rachel Marie Grace | SustainabilityHiya! I’m Rachel Grace. I’m a journalist, storyteller and content creator who is just figuring it out as I go. Sometimes I get really terrible writer’s block, so I put some ABBA or Gwen Stefani on full blast and clean my room until the words finally start coming to me. I’m passionate about telling the average person’s story (it’s usually the most interesting one), writing about food I eat and capturing life’s most colorful moments on my camera. I’m also a hopeless romantic, if you couldn’t tell. View my writing portfolio here: www.rachelmariegrace.com. 

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