1.
Sustainability- The Triple Bottom Line measurement
The sustainability notion has been presented by The United Nations World
Commission on Environment and Development (WCED) in 1987, the sustainability is an
economic enhancement mock-up that permits the current generation to satisfy their needs
but does not affect the future generations' capability to satisfy their needs. By then, the
new structure to measure the corporation’s sustainability had appeared in 1994 by
Elkington which was called “the triple bottom line” or TBL (Elkington, John, 2018).
Elkington (1998) has interpreted the words TBL in the book “Cannibal with Forks” that
TBL mentioned “economic prosperity, environmental quality and social justice”. “People,
planet, profit” are other words that Elkington used in 1995 to talk about TBL. Also in
1995, Clarkson said that determining and organizing CSR among stakeholders are the
most common methods, perform to stakeholders through TBL, not just perform to
shareholders and consumers. Wang & Lin (2007) also supported that economic
environment and social are factors that have been used the most in productivity
calculation. In 2011, Jackson, Boswell and Davis complemented the appearance of TBL
is because of the increase in the need for information of stakeholders about the
enterprises’s operations and financial positions, so, the administration has to provide the
information relevant to the sustainable matters. The authors also stated that not only at
present but also in the future, the foundation to calculate productivity is the influence of
enterprises on entire society. McDonough and Braungart (2002) provided that many
administrators seen TBL as a path to increase the product or service’s worth.
The TBL’s environment (planet) aspect concentrates on the suitability between the
tendency to utilize and reproduce the natural resources (Glaviˇc, P.; Lukman, R., 2007),
(Ruggieri, A. et al., 2016). This is shown through the manner of enterprises in only using
resources that can be re-create, manufacturing emissions which can be metabolized by the
current ecological system. In practical, this can be done by recycling, reproduce the
resource, increase the producing system to diminish the resource utilization, change the
non-reproduced into the reproduced resources, and apply the circular economic’s notion.
Alex Chamberlain stated that if the business tries to have the least possible impact on the
environment, limiting the use of natural resources, the chances of the business becoming
successful are higher. In environment bottom line, administer, supervise, inform about the
utilisiation, waste and emission are the main activities.
The economic (profit) aspect relates to enterprises's manner to produce values,
equalize expenses, returns in manufacturing, allocation; enterprise environment elements,
occupation, and enterprise variety elements (Bansal, P., 2005), (Pascual, L. M., Curado.
A., & Galende, J., 2019). The economic aspect of TBL is related to the enterprise's
economic and financial activities. According to Innocent, O. C. (2014), profit is the
economic worth received by the company after eliminating all input costs so it is different
from the traditional bookkeeping concept of profit. The TBL approach is not a traditional
company bookkeeping profit add up social and environment effects, except the case that
social advantage is the “profit” of different entities.
Dyllick, T., & Hockerts, K. (2002) stated that the social (people) aspect of TBL
related to the enterprise’s manner to ensure and expand human beings and society of
communities by organizing to produce value. The society sustainability includes features:
job contentment, life qualification, the society incorporation among communities, the
unity, the parity and fairness in products and services allocation, and identical in
education (Kiel, D. et al., 2017), the ability to approach social sources, health and social
funds (Pascual, L. M., Curado. A., & Galende, J., 2019). Innocent, O. C. (2014) explained
that a TBL business finds ways to bring the advantage to stakeholders, labour, area where
that business is performed, not to bring hazard to them.
These three aspects impact, overlap, and oppose each other, such as: investing in
production equipment with the aim of reducing waste will be economically
disadvantageous but beneficial for environmental and social sustainability. Businesses
that want to achieve sustainability need to implement all three aspects (Evans et al.,
2017). Many enterprises maintain sustainability in both planet and profit aspects;
however, they still have difficulty in dealing with TBL (Kiel, D. et al., 2017).
2. CSR benefits company and stakeholders
According to Martinez, del Bosque (2013), from being responsible to the
community by fully and transparently providing information about the company's social
and production activities, businesses will receive the satisfaction and loyalty of customers,
thereby increasing reputation of the business, retaining quality employees, avoiding
management risks and making a difference to competitors. The customers are willing to
pay a higher price to buy products and services from companies for which they have a
high degree of loyalty (Pirsch et al., 2007). Lin et al (2009) presented that having high
customer’s loyalty guarantee to maintain the current profit and long-term enhancing the
profit. Moreover, Torugsa et al., (2012) concluded that a high level of CSR creates a
positive influence on employee contentment, driving force and faithfulness in the
company. High levels of CSR increase employee retention, help the company ensure
highly educated employees, minimize fluctuations in employees in the company (Lee et
al., 2013).
Besides the benefits that CSR brings to businesses, CSR also brings many great
benefits to stakeholders. According to The Saylor Foundation, CSR creates conditions for
businesses to furnish jobs for employees, produce products to meet the consumption
needs of society. CSR contributes to creating a stable society, helping the government
make laws and regulations for businesses to follow. CSR also contributes to the protection
of the earth and resources by offering ethical responsibility, making businesses focus
more on recycling, saving materials. CSR makes a great contribution to improving social
welfare through charitable contributions, inspiring people to become good citizens.
