In 1970, Milton Friedman stated that the social responsibility of business is to focus only on increasing its profits. In the mid-1990s, John Elkington advanced the triple bottom line for businesses – people, planet and profit in an attempt to put social responsibility and the environment on an even level with shareholder profits. Many years later, where does the business world stand today?

People

While we often think primarily of shareholders, people refers to all relevant stakeholders such as employees, shareholders, customers, suppliers, community members, as well as future generations. Each of these stakeholders can be impacted significantly. For example, employees alone should be able to expect good working conditions, employers who understand the value they provide, fair policies, as well as hiring practices that promote diversity, equity and inclusion at all levels of the organization.

Planet

This could include any environmental impacts such as new facilities, sustainable environmental policies and practices, reducing waste, environmentally conscious supply chain operations, as well as limiting harmful emissions, usage of natural resources, and impacts on climate change to leave the planet in a better place.

Profit

The most common thought here is the financial profit of the organization itself, but we also need to consider positive and negative impact on local, national or global economies (for example, the negative economic impact of child labor or unsafe work conditions or the positive economic impact of developing good jobs, generating innovation or paying taxes).

Purpose

While those three “P” words all still seem appropriate, is there anything missing? Many people have argued that we need to put more attention on a fourth “P” word – Purpose. In my mind, Purpose could include any of the following:

• Ethical decision making and values-driven leadership focused on making a more sustainable impact on society via positive change initiatives.
• More focus on the environment, creating jobs and fostering innovation.
• Long-term value creation sparked by a meaningful vision for the future that allows organization to still be profitable in achieving that vision while also focusing on all stakeholders and the environment as well.
• Collaboration among all stakeholders via cross-disciplinary teamwork and effective measurement of results.

None of this is easy but we know it is worth it. Corporate social responsibility is very good for business in terms of attracting new customers and retaining existing customers. It also helps significantly to recruit millennials and Gen Z employees who often seek companies that strive to make a difference such as providing time off work to volunteer in their communities.

The views and opinions expressed are those of the author and do not imply endorsement by the University of Northern Iowa.