As we mentioned in our last article, the prevalence of the Triple Bottom Line philosophy is signaling a changing paradigm, a time of transformation. Our question, then, is this: What exactly are we transforming into? The knee-jerk answer might be that we are transforming from a capitalist system to a socialist system. However, the widespread adoption of 3BL belies such a simple answer. Socialism, with its complete government control of production, is hardly desirable for private business interests. American corporations are willingly embracing 3BL without even a government mandate. There is something deeper going on than simply a tug of war between two economic systems, and we are seeking to explore just what that may be.
Our first clues as to where we are going lay in the past, with the origin of the term “Triple Bottom Line.” For that we can credit John Elkington (his personal website and blog is here), who introduced the public to the term for the first time in his 1997 publication Cannibals With Forks: The Triple Bottom Line of 21st Century Business. Elkington is a longtime advocate for corporate environmental and social awareness, having cofounded the business development consulting firm SustainAbility in 1987. In fact, we may consider him a “founder” of corporate sustainability, having been called a “dean of the corporate responsibility movement for three decades” by BusinessWeek. Elkington currently serves as the Executive Chairman of the sustainability think tank Volans, which he helped found in 2008. His work with Volans is what provides a real glimpse into the end game of 3BL, in a concept termed “The Phoenix Economy.”
The Phoenix Economy is a concept professing that the failure of an existing economic system will leave a void and an opportunity for a new system to take its place. (The term “phoenix” refers to the bird of that name which, in ancient mythology, dies in a self-created fire and is then reincarnated from the ashes.) Old paradigms and established principles are replaced by a new way of approaching economics — and indeed the culture. Elkington recognizes this as an opportunity to establish a new paradigm based on 3BL philosophy. Global sustainability is the principle by which the economic and social culture will be driven. The Volans website provides a concise explanation of the Phoenix Economy.
According to Volans:
From the ashes of the downturn, a new economy is self-assembling–focused on providing social and environmental solutions, where markets and governments have failed.
If the pioneers of the Phoenix Economy are to succeed, they will still need substantial assistance from governments, foundations, investors and businesses, and we identify urgent opportunities for facilitation, collaboration and support.
The description goes on to say that the “single bottom line” system of the 20th century will be superimposed by the longer term Dragon (Chinese model) and Phoenix Economies in a transitional 21st century:
Twentieth century capitalism was driven by alternating ‘Bull’ and ‘Bear’ markets, and the twenty-first century’s first decade (2000-2009) has seen the collapse of the greatest Bull market in history. By contrast, a very different oscillation is now emerging as a driver of political, economic and business priorities. We expect the coming decades to see growing competition between ‘Dragon’ and ‘Phoenix’ models of wealth creation, superimposed upon–not replacing–traditional Bull and Bear dynamics.
The Bull and Bear fight it out in a single bottom line world. Both tend to be short term in focus. By contrast, Dragon and Phoenix mindsets tend to be longer term in orientation. Dragon markets, particularly China’s (until-recently-booming) economy, are often based on longish term planning, but are powered by business models and value chains that largely follow the path of Western industrialization, and–as a result–are likely to be increasingly taxed by environmental and natural resource constraints.
To date, Dragon economies have focused, at best, on a double bottom line of economic growth and the maintenance of sufficient social cohesion to keep the national locomotive on the rails. The Phoenix Economy, by contrast, blurs across national borders and works to integrate the triple bottom line of economic, social and environmental value added into its DNA–as a triple helix of change and new growth.
To be sure, Elkington’s vision is not fanciful and should be taken seriously. Remember again that this is the “dean” of the corporate sustainability movement and the person who coined the Triple Bottom Line term that has become so ubiquitous in today’s society. Given the seriousness with which we should approach his ideas, let’s listen to him as he explains his vision in a discussion of Volans’s “Phoenix 50” project:
Before we cast aside the idea that the Phoenix Economy is just a fanciful utopian vision, we would do well to observe how the premises of this vision parallel current events, and how the means of accomplishing it are being echoed in the words of our leaders and their mentors. The prevailing theme in all of this, of course, is the transition to a new economic and social order. Is it mere coincidence that our President (himself a member of the Phoenix 50) campaigned on a theme of “change”?
As a sidenote, it is interesting to note that Green for All, founded by Van Jones (a Shorebank account holder, former special advisor for the White House Council on Environmental Quality, and now senior fellow at the Center for American Progress), was also listed as one of the Phoenix 50 — as was Grameen Group (established by Muhammad Yunnus with the help of Shorebank, as the Central Illinois 9/12 Project wrote about previously).
Also, this transition parallels Rupert Murdoch’s chilling memo last year claiming, “We are in the midst of a phase of history in which nations will be redefined and their futures fundamentally altered.” At the time, we were frustrated that Obama did not explain the “change” he was promising, and Murdoch did not provide specifics to his claims, either. Could the new 3BL-based economic order of the Phoenix Economy be that change?
Not only does the current economic climate parallel the context behind the Phoenix Economy, but Elkington’s explanations of how it’s achieved also mirror the words and actions of our current ruling class. According to Volans, the first stage of Volans’ Phoenix 50 plan for realizing the new order states, “Opportunity is revealed via the growing dysfunction of the existing order.” Does this theme, which Elkington calls “creative destruction,” sound familiar? It should. Remember Rahm Emmanuel’s confession that you “never want to let a serious crisis go to waste”?
We can even see the means towards achieving the Phoenix economy reflected in the Saul Alinsky organizing model, which Obama learned when he was a community organizer in Chicago. These methods promised a transformation of society’s institutions in response to the collapse of the status quo. Indeed, the notion of the disintegration of the current order being a means towards establishing a new order is hardly novel with our current leadership.
It does seem that the pursuit of a Phoenix Economy based on Triple Bottom Line philosophy is congruent to the philosophy and actions of our current leadership. That alone bears attention. However, as we have mentioned, this vision does not start or end with government. It is already prevalent throughout our economy and culture. Elkington correctly observed that implementing the Phoenix Economy requires assistance from governments, foundations, investors and businesses. Well, it appears the assistance is bountiful: mainstream corporations as influential as McDonalds, Walmart, and GE are adopting 3BL principles; in fact, even your church may be preaching the sustainability gospel.
The sustainability agenda, with its 3BL commitment to “People, Planet, and Profit” is steadily establishing itself as the new paradigm of our economy and culture, and it demands our attention. Because society at large is buying into the sustainability agenda, we cannot easily blame a tyrannical government for standing in the way of our free choices. Therefore, it is paramount that we become educated about the options presented to our society before we make the choices that will affect it. It is our hope that this series on the Triple Bottom Line, its history, and its future can and will be used as a stepping stone for doing so.