LinkedIn Dialog
Group: The B Team

The B Team ... 2,577 members Member ... Discussion: The Double Bottom Line

Burgess COMMENTARY

Peter Burgess

The B Team ... 2,577 members Member
The Double Bottom Line

Brandon Andrews Follow Brandon Brandon Andrews
Legislative Specialist - Digital Strategist - Philanthropist

With Goldman Sachs, Morgan Stanley, and sovereign wealth funds increasing their social impact investments, is the pursuit of the 'double bottom line' the new norm for business?

Goldman plans $250m ‘social impact’ fund - FT.com ft.com

Goldman Sachs is launching a $250m “social impact” fund whose returns are linked to the success of projects such as affordable housing, pre-school education and how many young criminals commit new offences after leaving New York’s notorious...

Like (4) Comment (9) Share Unfollow Reply Privately3 days ago

The Double Bottom line is not a phrase I would liked to see used.

I am an absolute supporter of community engagement projects and companies considering their social impact (we have just launched a social impact project ourselves albeit on a much smaller scale http://bccawards.org.uk/Southend/ ) and naturally I think this social impact fund is a fabulous move forward. The more corporates following this lead the better!

But the whole concept of CSR / Triple Bottom Line - whatever you want to call it - is about taking a holistic approach to business: we need to look at business, people and the environment in tandem and not start breaking everything down in to separate elements. That's a retrograde step not progress. Ethics and values need to be embedded at the very core of business operations - not treated as separate add-ons.

So please - no more talk about Double Bottom Line!

Like Reply privately Flag as inappropriate 2 days ago

Thanks for sharing your experience Jill. I agree that, as you said 'ethics and values need to be embedded at the very core of business operations - not treated as separate add-ons.'

I have a few questions:

1) Can an effort like Goldman's Social Impact fund influence the core ethics and values of the organization? Could these add-ons help companies climb the ladder of value based/ethical engagement?

2) Do you have an example of a company taking, what you see as, the right approach?

3) Is there another term that you feel is more accurate and/or better suited?

Thanks!

Like Reply privately Flag as inappropriate 1 day ago

Having worked with social enterprise over the past five years what has emerged is the triple bottom line (people, planet, profit).

Like (1) Reply privately Flag as inappropriate 1 day ago Jill Poet likes this

Exactly Amanda. And I think any reference to a DBL would dilute that.

Like Reply privately Flag as inappropriate 1 day ago

Good share Brandon thanks. Its a lot cheaper and simpler to fund 'social projects' then to change anything substantial about the way we employ, work and compete today. Should we be grateful? Sure, as a monkey is grateful for peanuts at the zoo, and the unfortunate few now funded by this new initiative count their lucky stars for a 2nd or 3rd chance at life, but humans are not monkeys and peanuts will eventually be insufficient.

This reads to me like the Rich Boys Bankers Club re-redefining what is required to not tip the social balance any further, and re-writing the communication accordingly, till the next fad.

But this is not a fad, and unlike the price is right, at least in this version of the game, the price only goes up..

Social projects is too low of a starting bid...

Like (1) Reply privately Flag as inappropriate 14 hours ago Ellen Pabst von Ohain likes this

I like numbers. They put things in perspective. So according to the article Goldman is planning a $250 milllion fund and already has $3 billion of its own money already invested in investments with a double bottom line.

According to Yahoo Finance http://finance.yahoo.com/q/ks?s=GS+Key+Statistics

• Goldman Sachs has a market capitalization of around $70 billion
• Net income during the four quarters ended June 30, 2103 was in excess of $8 billion
• Investments of the company exceed $500 billion

I want to see comprehensive Triple Bottom Line (TBL) accounting for both the SMEs and the big organizations ... for both the not-for-profit sector and the for-profit sector.

Peter Burgess - TrueValueMetrics
Multi Dimension Impact Accounting

Delete 9 hours ago Marco Monfils likes this

Thanks everyone for engaging!

Given the fact that Goldman and others who fund these projects are focused on a positive return - of some sort.

What can we, individually and through the B Team, do to increase the return on/succeess of their investments?

Success will generate the hard numbers and support from our community may lend the positive pressure needed to increase these social impact funds and possibly change the way these organizations approach business.

Like Reply privately Flag as inappropriate 4 hours ago

When I first starting doing strategy work - 20-30 years ago...? - we talked with clients about 4 groups of stakeholders; customers, staff, financial and the wider community (which today would be extended to include environment). Similarly, the Balanced Scorecard work which we started back at Nolan, Norton, had something similar in mind. However, the financial institutions are still overwhelmingly driven by the principle that there is just one set of stakeholders that matter, namely financial, having bought lock, stock and barrel into the shareholder value idea.

Goldman Sachs (and their contemporaries) are in the forefront of driving that narrow, selfish and destructive approach. As long as that thinking dominates what they do, a few social impact bonds is just gesturing, playing at the edges and does not compensate for the massive damage that the rest of their business does. They are not called the 'vampire squid' for nothing! The best companies recognise that this is about changing how their core business works, aiming to 'do no harm' with that core business, and preferably have a positive impact overall. Nobody is perfect but Unilever with their sustainability business strategy and M&S's Plan A would be good examples.

Currently we have an economic model that is unsustainable financially, socially and environmentally. We are not going to fix this by playing at the edges, though it might make people feel better - or a bit less guilty.

So for me its how we really promote and support the good examples, rather than carping about their imperfections. And encourage those companies who are trying quietly to start down the same track, but don't want to startle their City shareholders, to have the courage to come out into the open and gang up together

And start reading about the application of chaos theory to economics - small interventions can sometimes have big results....!

Like (1) Reply privately Flag as inappropriate 1 hour ago Jill Poet likes this

I'm an International Communications Consultant and Coach who helps businesses communicate with 'foreign' markets or any stakeholder that is not native for them. Part of the work I do as consultant is to analyze a firm's operations and practices regarding their sustainable actions, analyze their external marketing message about those activities, interpret how their brand is perceived regarding sustainability in the market and then try to reconcile where the disconnects and truths lay. Some of them provide the material I need for fair appraisal, many don't or none exist (the metrics). Since it is branding and marketing they are really concerned with, they tend to feed me with what they want me to know. Subsequently, most of my info is gathered outside of the firm's control. Then I report all that back to the firm and we ..

1. a) fine-tune their marketing message to reflect something more realistic, or
2. b) they make real changes (where and when possible) and then we promote that,
3. c) they ignore the first two and continue with their original message.

It is the consumer market that will force the firm to make changes, not anyone finding out what is good or bad about a firm. We have a long history of looking the other way if the product is the most attractive and desirable on the market. Question: How can we make a product appear less attractive while still remaining desirable? Can we 'educate' demand ethically to control supply?

We all speak to each other frequently and passionately but we are preaching to the already-converted. How can we open the channel of our already enlightened community to reach the average consumer and to inform? He may not actively seek or even know how. How do we reach out?

Ultimately, firms just want to make money and if it means they have to make changes because the consumer demands they do, that's when they will.

Like Reply privately Flag as inappropriate 8 minutes ago

Dear Colleagues

There is a lot of energy going into the dialog about improving performance of the organization so that there are better outcomes. Compared to 10 years ago, this level of energy is very encouraging. There are however, many bit challenges.

In my own case, I am seeking to have some radical reform of the system of metrics that we are using so that there is quantification of everything that really matters. Some say it cannot be done. I say it may not be easy, but it can be done.

I believe that when there are the right sort of metrics, then there will be deeper behavior reform in the organization than there is at present. The CEO can talk the talk, but the metrics throughout the organization have to support this so that the organization as a whole can 'walk the talk'.

I also want a system of metrics that will serve to hold to account those organizations that do not 'buy in' to social responsibility and merely go on their own way to maximize profits no matter what the consequences on all the externalities.

My effort in this direction is something I call Multi Dimension Impact Accounting (MDIA). A 2 page brief on MDIA can be accessed via this URL together with some other material:
http://www.truevaluemetrics.org/DBadmin/DBtxt001.php?vv1=txt20080001

The 2 page pdf can be accessed directly at this URL:
http://www.truevaluemetrics.org/DBpdfs/BMABusiness/TVM-MDIA/TVM-MDIA-Brief-131107b.pdf

My work is far from finished, but I believe I am making some good progress. Critical constructive feedback is very welcome.

Peter Burgess - TrueValueMetrics
Multi Dimension Impact Accounting

Delete Edit Comment You have 14 minutes