The bottom line for any business is making a profit, right? Yes—but how about considering an additional bottom line: making the world a better place.
What is a double bottom line?
Double bottom line (DBL) is a business strategy that marries financial profit to social responsibility.
Ordinarily, the bottom-line tracks fiscal performance and financial profit and loss. DBL measures the benefit of positive impact—it focuses on more than just the return on investment. Rather, it considers both the financial and social aspects of your business.
Where did the concept of DBL come from?
The idea that for-profit corporations have an obligation to support social causes beyond their interest in short-term profits dates back to the corporate social responsibility movement in the 1960s. The idea that upholding social responsibilities can help a company sustain profits in the long-term has been “part of mainstream management theory at least since the publication of Edward Freeman’s 1984 classic, Strategic Management: A Stakeholder Approach”, according to an article by Wayne Norman and Chris MacDonald. An early reference to the term itself came in Emerson and Twersky’s 1996 book New Social Entrepreneurs: The Success, Challenge, and Lessons of Non-profit Enterprise Creation.
The term DBL grew from a concept that Jed Emerson developed at Harvard Business School. A senior fellow with the William and Flora Hewlett Foundation and the David and Lucille Packard Foundation in 2007, Emerson coined the terms “blended value proposition” and “blended return on investments.” “Blended” includes more than financial considerations, such as social and environmental returns on an investment. His work led to an investment trend called “socially responsible investment,” or holding a DBL.
Why do people want to work at a DBL company?
Values have a strong influence on consumer behavior. Today’s consumers don’t just want high-quality products and services. They want to use their purchasing power to support businesses that support bigger causes, so that they too can have a positive impact.
Corporate values not only impact consumer behavior but also the decisions of top talent within the workforce. When you commit your business to a DBL, your employees experience a greater sense of self-fulfillment at their jobs because they are making a difference in the world just by showing up for work each day.
What are the advantages of having two bottom lines?
Placing equal value on profit and the planet is a step in the right direction for the business world. As long as businesses have existed, a majority have drained environmental resources, polluted the earth, and created a host of environmental problems. DBL recognizes that without consideration for the planet, businesses will drain or pollute their resources faster than those resources can be replenished. That means businesses will not survive—and even more, humans will not survive the severe consequences of the climate crises. This recognition is the beginning of a less polluted, more diverse, and more productive world.
That said, surviving the climate crisis is not enough. It also requires a foundation of race and gender equality, greater economic equality, and more resilient communities. For this reason, social issues matter as much as sustainable solutions for climate change. DBL acknowledges that without high standards for human rights, equality, and healthy communities, companies won’t gain consumer support and will be forced to either reevaluate their standards, or close their doors for good.
The good news is many companies are making an effort to serve the greater good. In fact, 63% of business leaders strongly agree that their company “has a purpose beyond making money,” and that this purpose is critical to business performance.
“In many situations, it’s possible to do the right thing and make money at the same time,” Harvard Business School Professor Rebecca Henderson says in Sustainable Business Strategy. “Indeed, there’s good reason to believe that solving the world’s problems presents trillions of dollars’ worth of economic opportunity.” Case in point: research by Nielsen found that 48% of U.S. consumers would change consumption habits to lessen their impact on the environment.
Seven more advantages of a DBL.
Businesses that adopt two bottom lines are more resilient to environmental stressors. And, businesses that see people and the planet as essential components of their strategy enjoy better relations with consumers. They’re likely to be seen as progressive and sustainable, with the best interests of society at heart. But that’s not all—here are seven more advantages:
- Enhance brand image
- Increase employee retention rate
- Improve employee satisfaction
- Attract top talent
- Reduce carbon footprint
- Expand business opportunities with ecofriendly partners
- Grow your business and improve your financial future
Is 10Pearls a double bottom line company?
Since its inception, 10Pearls has been a DBL company, committed to delivering superior services and making a difference in the world. 10Pearls University, 10Pearls Labs, and Empower Foundation are platforms created to foster continuous learning, research and development, innovation, gender diversity, training, and philosophy.
All that to say this: a culture of social responsibility is ingrained in 10Pearls. Balancing people, profits, and social progress is how we built our business and how we help our customers grow. So, if you want to create better customer experiences and carve a path towards more meaningful work that benefits the world, let’s talk.