I imagine like most people when they first meet John Elkington, I was a bit awe-struck when we had lunch about a year back. After all, this is the man who created the term the Triple Bottom Line (TBL) that was to become the mantra of responsible capitalism based on businesses assessing their impact on three measures: people, profit, planet.
Unless businesses addressed the environmental decay we are witnessing worldwide, he argued some 25 years ago, as a core commercial driver sustainability would never be achieved.
Thousands of businesses have adopted this way of thinking and indeed, it is woven into the project plan I have written for what I hope will be my next commercial venture.
So I was intrigued when a mutual friend told me the other day that John had issued a “product recall” on the idea. Manufacturers, he says in an article for the Harvard Business Review, have to do this when a fault is detected – the quicker the better. Management ideas, he argues, never do the same.
The reasoning behind the recall from what I’ve understood is that whilst TBL has become the principle by which many businesses are now driven, the world’s environmental problems continue to rocket at a far bigger scale than the number of corporations stepping up to reverse this.
Whilst large scale multinationals may not have picked up the ball with TBL action quite as rapidly as many of us would have liked, the enabling tools at macro scale are increasingly being made available. From the UN Sustainable Development Goals to the head of the world’s biggest private equity firm saying that businesses without social impact at its core would in time become extinct, John has a point: why are more firms not doing more?
For small and medium sized businesses, it’s different; we can commit and change very quickly. Not only can an owner/founder act on their concerns wider than profit as conventionally defined, we are already doing so, as I reported on recently. Indeed, even at “The Queen’s Bank” Coutts there was an event this week which I was invited to full of SMEs either sharing their social impacts and sense of purpose or enquiring on how to build them. Times are certainly changing on that latter dial – one lady in the audience said that when she started her business 20 years ago her sole purpose was to pay her mortgage.
Today that approach seems incredibly out-dated.
But I imagine John’s concern is two-fold: firstly, that too many large corporations still think that way and secondly, those with a broader perspective aren’t delivering sufficiently for us to yet herald the age of a new, responsible capitalism.