What is and isn't the Triple Bottom Line?

The term "triple bottom line" comes from the private sector, where the (single) "bottom line" of company profit has typically reigned supreme. As consumers and shareholders increased their interest in the social and environmental effects that accompanied the production of goods and services, some businesses acknowledged a need to look beyond profit as they evaluated their performance. TBL recognizes that decisions affect not only a company's profit, but also the broader economy, society, and the natural environment.

TBL is often referred to as the "three Es" of Economy, (Social) Equity, and Environment. In the public or non-profit sector, these concepts take on a slightly different meaning and application. Here, the "three E's" of Economy, (Social) Equity, and Environment are relevant, reflecting the broader public context and sphere of governance. Evaluating "Economy" requires going beyond the profit enjoyed by shareholders (which is nevertheless an important quantity to measure) to consider the net economic benefit to society. "(Social) Equity" relates to the health and wellbeing of people impacted by the activities of an organization: labor, the surrounding community, and the larger region. "Environment" refers to the wellbeing of the natural environment and takes into account carrying capacity, ecological footprint, and cradle-to-grave accounting.

At a minimum, TBL is a reminder that decisions typically have multiple trade-offs. Identifying significant economic, social, and environmental impacts helps ensure that decisions are well informed. TBL is an approach to better inform decision-makers—and the public they serve.