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The Triple Bottom Line: Sustainability and Democratized Development

By Kathleen Largo, Sam Ramos-Jones and Enzo Pinga

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Kathleen
Sam
Enzo
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Passionate about entrepreneurial management and social innovation, Kathleen works with non-profit organizations, startups, and small local businesses. A political researcher, writer, and digital content curator, advocating for the democratization of public policy discussions in the Philippines. Enzo Pinga is a farmer and entrepreneur seeking to grow the food movement in the Philippines.

The Triple Bottom Line (TBL) is a business framework, first coined by John Elkington in 1994. Traditionally, in business and accounting, the “bottom line” refers to the profit or loss generated by a company. Elkington’s play on this well-known phrase underscored his belief that there were other factors, aside from profit, by which businesses should define their success. Namely, the three pillars of the Triple Bottom line are: social, environmental (or ecological), and financial. Seen from the TBL framework, successful companies are not just ones that rake in huge amounts of money, but also ones that offer positive social and environmental impacts in addition to successful profit generation. The Triple Bottom line thus challenges the underlying pillars of neoliberal capitalism and posits a more socially conscious, environmentally friendly, and people-centered module for business, which is nevertheless profitable. It is precisely this type of creative and courageous thinking – the willingness to challenge our traditional assumptions in business and economics – that will be necessary to harness the disruptive trends and new technologies of the Fourth Industrial Revolution for the greater good.

 

 

The Potential for Dystopian Dangers

 

The Fourth Industrial Revolution, as with all previous ones, offers both tremendous opportunities and risks. Increasingly, technological innovations will drive automation to substitute for labor across the entire economy. Whole sectors of employment may fall victim to these trends, which put millions of low-skilled laborers at risk of becoming obsolete. From the automotive industry to agriculture, robots are replacing people. Spread, a Japanese vegetable producer, is aiming to complete the world’s first completely robotic farm by mid-2017.1 In May 2016, Foxconn, the Chinese supplier of components to Apple and Samsung replaced 60,000 workers with robots in just a single factory.2

 

At the same time, the world’s supply of finite resources will come under increasing demand-side pressures. “By 2050, the over 9 billion people inhabiting the world
 will demand 60% more food than what is consumed today.”3 The over-consumption of fossil fuels, precious metals, and the depletion of rainforests and fishery stocks threaten to destabilize the basic underpinnings of our globalized economy and society. If we are to prosper in the future, new methods of production will be needed – ones that balance profit motives with responsible stewardship of our natural environment and prioritize sustainable, rather than extractive usage of our natural resources.

 

According to the World Bank’s 2016 World Development Report: Despite digital technologies spreading rapidly across the world, “digital dividends—that is, the broader development benefits from using these technologies—have lagged behind.”4 There remains an inequitable divide in access to innovative or revolutionary technologies. According to the aforementioned report, the benefits of digital expansion have been skewed towards the wealthy, skilled workers, and influential corporations that are better positioned to take advantage of new technologies. Aside from this ‘digital divide,’ there are vast gaps in the provision of more basic goods and services. For example, today, more people around the world have access to mobile phones than to basic sanitation, potable water, or electricity. These gaps are posed to grow unless conscious efforts are made to achieve more equitable and sustainable development.

 

The question is therefore not whether the innovations of the Fourth Industrial Revolution will have a dramatic impact on our lives – but rather, the question is how can we best assure that these impacts are positive, distributed equitably, and used to enrich rather than diminish the human experience.

 

During the First Industrial Revolution in 19th Century Britain, mechanical equipment, the power of water and steam engines, and iron making rapidly transformed the textiles industry. “Tasks that were previously done laboriously by hand in hundreds of weavers' cottages were brought together in a single cotton mill, and the factory (as we know it) was born.”5 There were, as there are now and will be in the future, casualties on the road to progress. As thousands of independent textile manufacturers lost their jobs, social unrest festered. Famously, some workers, in protest of these dramatic and disruptive transformations, destroyed machinery and factories. The term “Luddite,” has since become synonymous with people threatened by and therefore opposed to industrial and/or technological modernization. The Fourth Industrial Revolution will similarly threaten to upend the lives of millions – potentially producing a new generation of Luddites. Ensuring, therefore, that the livelihoods and concerns of these people are considered by our political and business leaders is perhaps as much a moral imperative as it is an economic and security one.

 

The novelist William Gibson famously stated: “The future is already here – it’s just not very evenly distributed.” Thankfully, the very same disruptive forces that threaten these risks to our social fabric and natural environment may hold the potential for their salvation. As we progress farther and farther into that future, greater care must be taken by governments, companies, and individuals, to ensure that we use the emerging technologies and innovations of the Fourth Industrial Revolution to close, rather than exacerbate these gaps. We must guard against the grave potential for awakening in a dangerous dystopian futurescape. We must, in the words of Klaus Schwab, the Founder and Executive Chairman of the World Economic Forum (WEF), forge “a new collective and moral consciousness based on a shared sense of destiny,”6 so that the supposed benefits of technological progress are fully realized. “The new technology age, if shaped in a responsive and responsible way, could catalyze a new cultural renaissance that will enable us to feel part of something much larger than ourselves – a true global civilization.”7 

 

 

Sustainable Development and Innovation

 

Digital technologies can promote inclusion, efficiency, and innovation. When industries and organizations enhance access to digital technologies, they can accelerate growth, create more jobs, and make business more environmentally sustainable. 

 

‘Sustainable development,’ once considered a fad in corporate social responsibility (CSR) efforts and a means of promoting a positive image for businesses, has become, and will continue to be, the defining factor of the new economy. Conventional economic paradigms held that sustainability came at the expense of profitability. It has since become clear that this is not the case. Indeed, sustainable development, aside from offering positive externalities, simply makes good business sense. It was once thought that alternative energies could never compete with fossil fuels. This year, Bloomberg reported that in some countries solar power is already being produced at half the average global cost of coal. “In less than a decade,” Bloomberg reports, “it’s likely to be the lowest-cost option almost everywhere.”8

 

On the one hand, sustainability is about increasing efficiency and decreasing the consumption of finite resources. This can be accomplished through harnessing the new digital tools that the Fourth Industrial Revolution is beginning to usher in – allowing companies to save millions in capital and operational expenditures. In a larger sense, though, sustainability is also about cultivating a culture of innovation to maintain a high level of dynamic thinking and problem solving. The most successful companies will be those that are willing to evolve and adapt their business practices to the changes in the demands of consumers and the availability of resources and technologies. General Electric, for example, was recently named “the 124-year old startup” by Bloomberg, highlighting the company’s dynamism over one and a quarter decade.9 GE Philippines’ CEO, Jocot de Dios, summed up the company’s history thusly: “we went to bed as an industrial company, we woke up the next day as an internet industrial digital company.”

 

Increasingly, large companies are turning to smaller ones to help them develop these cultures of dynamism. In the Philippines, Hybridigm Consulting (its name a fusion of ‘hybrid’ and ‘paradigm’) works with a number of larger companies to alter their operational paradigms, while infusing them with more innovative and sustainable practices. According to Hybridigm’s Co-Founder, Maoi Arroyo, there is a lot of demand for this type of consulting as established corporations “do not yet know how to define [sustainability], but they want more of it.” For Arroyo, there is also a strong social component, premised on working with marginalized communities through a bottom-up approach: asking them what their needs are and tailoring business offerings toward those needs – a demand driven, rather than demand driving, approach. It is important to note as well, that innovation at the community-level does not necessarily have to rely on the newest or most advanced technology. Often, the most effective approach is to utilize what is known as ‘sidewise’ technology – applying mature technologies to different problems, as well as making those technologies more accessible and human-centered in their design and implementation.

 

Japan-based Ishinomaki Laboratories provides a case study for utilizing sidewise technology for social good. Ishinomaki adapts basic tools to help forge replicable and self-sustaining communities by studying what skills and goods are unique to a community, using “local materials and local skills, to determine if there is anything unique that you can create, which can be exported to other parts around the world.” Part of sustainability is centered on increasing livelihood opportunities to reduce the opportunity gaps and the urban-rural divide. Connectivity and communication facilitates these efforts. According to David Wang, Project Manager at Ishinomaki, “we don’t use complicated tools… because we are still very focused on the community. We are just connected with the outside world and that is the model that we would like to push forward now.”

 

Similarly, Kalsada Coffee, founded by Carmel Laurino, is utilizing the increased flexibility of new technology to make manufacturing in rural areas in the Philippines more feasible, and allow smaller, local producers to compete with imported coffee from large multinationals. Key to Kalsada’s success has been the ability to raise capital through non-traditional vehicles – through crowdsourcing. The company got started on a $15,000 initial round of fundraising on Kickstarter. Kalsada’s mission—to champion Philippine coffee and help enable Filipino coffee growers take part in the growing demand for artisanal coffee10—appealed to a sense of social good and community building that may have been ignored by traditional investors.

 

The greater level of connectivity afforded to rural communities through the internet has helped Bryan McClelland, Founder and CEO of Bambike manage his team while he is 120 kilometers away in Manila. By providing his rural partners with mobile internet access and tablets, Bryan is able to make use of digital management tools such as Slack, which allows the team to be constantly connected. For Bryan, the tools extend beyond management; it is about “empowerment and increasing their education”. Once low-skilled rural workers have gained a savvier understanding of product design and customer satisfaction, while seeing their wages rise, without having to completely uproot their lives and try and strike it out in the big city.

 

Grassroots sustainability efforts for these startups are heading towards combining technology with community development and business development.  While breakthrough technologies that come with the Fourth Industrial Revolution are pushing the world forward, smaller technologies and low tech solutions that are available can create big impact on the rural community level, bridging the divide and providing products for the global community.

 

 

Technology for Social Welfare

 

The greater levels of connectivity ushered in by the Third Industrial Revolution’s computer age, will only expand in the Fourth. “Already, digital media is increasingly becoming the primary driver of our individual and collective framing of society and community, connecting people to individuals and groups in new ways, fostering friendships and creating new interest groups.”11 Interest groups, despite geographic separation, can now connect, mobilize, and support each other through digital communication. The Philippines-based B-Change Group, founded by Laurindo Garcia, is creating replicable online communities that enable LGBT and HIV-positive youth to connect with one another and with community organizations, service providers, and government institutions. Through the internet, they can design platforms to accelerate the movement for gay rights and sexual health in Southeast Asia and beyond.

 

Similarly, Analisa Balares, CEO of Womensphere, is utilizing online connectivity to accelerate women's advancement in leadership, innovation, and entrepreneurship around the globe. Her organization is “dedicated to advancing women and girls, promote gender equality, inspire transformational leadership, and mobilize interventions and initiatives to create a more inclusive, more sustainable world.”12

 

This type of advocacy – of organizing and mobilizing persons spatially disparate, yet united in their needs and interests is a promising example of how the Fourth Industrial Revolution may further enhance our connectivity to enhance societal welfare – by giving hitherto disenfranchised persons and groups a medium for organization and a voice in mainstream sociopolitical conversation.

 

Another initiative to use technology for the benefit of the previously disenfranchised is the Japan-based ShuR Group, founded by Junto Ohki. ShuR created the first kanji sign language keyboard, which enables deaf users to learn, share, and communicate in a way that many of us take for granted. Ohki’s mission is to utilize technological progress to promote the interests and enhance the lives of persons living with disabilities. Advances in virtual reality, artificial intelligence, genome mapping, and other advances in biotechnology may enable us to enhance the lives of millions of handicapped people worldwide.

 

This new technological age not only shows us what’s possible, but also signals an opportunity to use older but still relatively advanced technology that used to be quite expensive to promote inclusivity. The Cebu-based social enterprise engageSPARK created a mass-communication platform (for surveys, polls, reminders, etc.) that runs on offline mobile phone functions such as SMS messaging and voice calls with the goal of “interact[ing] with everyone at scale – even the 5 billion people offline.”13 Thus,  by augmenting the way we interact with technology we can give millions an opportunity to utilize the technology of the Third Industrial Revolution in a way that has up until now proven difficult.

 

 

Financial Dividends

 

Notwithstanding the massive opportunities for social and ecological benefits, the Fourth Industrial Revolution also promises, and already has delivered, substantial benefits to the original “bottom line.” Advances in technology have not only made sustainable development and business practices more cost effective, but have also brought the impetus for safeguarding our environment and limited natural resources into alignment with profit motives. Technology-driven people empowerment, aside from being socially responsible, allows more companies to operate in rural areas, where lower-cost labor makes compelling business sense. Finally, the Fourth Industrial age is ushering in an unprecedented area of new capital – by allowing us to unlock what we already have, but have been unable to utilize.

 

But innovation obviously does not come cheap. With the rise of crowdfunding websites and other fundraising platforms, more people are becoming entrepreneurs and starting their dream projects and careers – relying less on traditional investment mechanisms and more on a shared sense of community, mission, and values. Technology has democratized access to capital in a way that has upended the traditional requirement of having a good credit standing before you can receive a loan from a bank.

 

These developments may lead us to a situation where the free market is, in fact, more free – where the world of investment is not limited solely to the wealthy with large portfolios available for dabbling in the stock market, but also to individuals and groups willing to invest smaller amounts in their localities or in projects whose mission and values they identify with. A reduction in the barriers to entry for investment, and for being invested in, allows for greater market competition – better economic outcomes, and perhaps more important, more socially beneficial ones.

           

 

A Brave New World

 

The Fourth Industrial Revolution will have dramatic effects – on the way we make things, work, and live our daily lives. Through digital connectivity, we have, like never before, an opportunity to forge a truly global community. However, the expanded connectivity of the digital realm has not necessarily led to the emergence of expanded, diverse, or compassionate worldviews. The recent U.S. Presidential election, the ascendancy of Donald J. Trump, in conjunction with an ever-increasing prevalence of fake news, serves to underscore how, ironically, in an age of greater connection, our online conversations are becoming more disconnected – from each other, and in some cases, from reality altogether.

 

Indeed, a similar phenomenon has been felt here in the Philippines, with online armies both in support and in opposition to President Duterte, engaging in running battles – not in the streets, but on newsfeeds. “Paradoxically, the dynamics of social media use can serve to narrow available news sources… It is important that the emerging technologies of the Fourth Industrial Revolution increase diversity and the potential for collaboration rather than driving polarization.”14 However, it is clear, from the dynamics we are seeing now, that social media platforms may have to be innovated and redefined, to be less conducive for petty partisanship, and more so to the type of open conversations we need.

 

An enduring truth about technological progress is that it does not necessarily guarantee social progress. Take for example, the automobile. At the turn of the 20th Century, most people either walked are used horsepower. The main problem with horsepower? Horse manure: which literally flooded the streets of large urban cities like New York or Paris. Part of the reason the automobile was developed and adopted so enthusiastically was precisely because it was considered a “cleaner” mode of transportation versus the dung-dropping steeds of the day. Now, a century later, we are confronted with the harsh reality that automobiles have been a far from “cleaner’ alternative – so much so that the burning of fossil fuels to power these vehicles is now dramatically challenging the stability of our very climate.

 

Professor Schwab reflects on a more recent case of where the “integration of technology in our lives could diminish some of our quintessential human capacities, such as compassion and cooperation. Our relationship with our smartphones,” he continues, “is a case in point. Constant connection may deprive us of one of life’s most important assets: the time to pause, reflect, and engage in meaningful conversation.”15 As new technologies become more pervasive and quintessential to our daily lives, we must be ever cognizant of the effect these technologies are having on the quality of our lives. The risk is that, in adopting technology too rapidly, or without adequate forethought into what we want technology to do for us, we may find our lives diminished, rather than empowered or enriched by the new forces we are unleashing.

 

According to Pamela Cajilig, Co-founder of Curiosity Design Research, new technology often fails to achieve the positive externalities we desire because builders don’t acknowledge the presence of existing models – there is a demonstrated desire to be “new” rather than more user friendly. According to Ms. Cajilig’s empirical research on both private companies and NGOs, there is a tendency to be exclusive when it comes to implementing technology, and a top-down approach is often taken, such that the needs of communities at the grassroots level are too-often unconsidered.

 

It is imperative that we remain ever vigilant and ensure that we pursue technological progress, not merely as an end in itself, but as a means to improving the human condition. “All of us are responsible for guiding its evolution, in the decisions we make on a daily basis as citizens, consumers, and investors. We should thus grasp the opportunity and power we have to shape the Fourth Industrial Revolution and direct it toward a future that reflects our common objectives and values.”16

 

Professor Schwab concludes:

 

“To do this, however, we must develop a comprehensive and globally shared view of how technology is affecting our lives and reshaping our economic, social, cultural, and human environments. There has never been a time of greater promise, or one of greater potential peril. Today’s decision-makers, however, are too often trapped in traditional, linear thinking, or too absorbed by the multiple crises demanding their attention, to think strategically about the forces of disruption and innovation shaping our future.”17

 

In short, we cannot rely on our leaders alone – all of us, must take up the mantle to lead, to chart our course forward.

 

In his seminal work, Aldous Huxley envisioned a ‘Brave New World,’ wherein developments in technology across a wide-range of areas from manufacturing to reproduction, education, and psychological manipulation – the very technologies that the Fourth Industrial Revolution is just beginning to introduce – combined to dramatically alter our society. In his dystopian world, human society was more docile, stable, productive, and yet somehow much less human. Freethinking, compassion, and emotion, were all suppressed – casualties along the road to “progress.”

 

The Triple Bottom Line framework reminds us what is truly important, that technological progress should not be an end in itself – rather, it should be a means towards achieving better social outcomes, a greater level of stewardship of our environment, and yes, financial dividends. In this brave new world we are advancing ever more rapidly toward, it is imperative then that we shape innovation for the designs of all humanity. In such an age, it has perhaps never been more important to “deal more kindly and compassionately with one another,”18 develop a shared sense of destiny – a community not just within nations but among them – a collective understanding of the one thing that truly unites us: our humanity.

footnotes
Annotations
Rexy Josh Dorado :
"I like the idea that democratizing investment can lead to a more diverse array of investment motives and incentives. We’ve seen this through experiments in “social impact stock indexes” in different parts of the world, in the slow emergence of social impact or “world-positive” investment firms, and in the recent story of an AI-powered hedge fund that promotes a more transparent, open-source method of investment."
Citations
1
 McCurry, Justin. "Japanese Firm to Open World's First Robot-run Farm." The Guardian. Guardian News and Media, 02 Feb. 2016. Web. 27 Feb. 2017. <https://www.theguardian.com/environment/2016/feb/01/japanese-firm-to-open-worlds-first-robot-run-farm>.
2
 Wakefield, Jane. "Foxconn Replaces '60,000 Factory Workers with Robots'." BBC News. BBC, 25 May 2016. Web. 27 Feb. 2017. <http://www.bbc.com/news/technology-36376966>.
3
 "World Development Report 2016: Digital Dividends." World Bank. World Bank, n.d. Web. 27 Feb. 2017. <http://www.worldbank.org/en/publication/wdr2016>.
4
 "The Third Industrial Revolution." The Economist. The Economist Newspaper, 21 Apr. 2012. Web. 27 Feb. 2017. <http://www.economist.com/node/21553017>.
5
 Davis, Nicholas. "What Is the Fourth Industrial Revolution?" World Economic Forum. World Economic Forum, 19 Jan. 2016. Web. <19>.
6
 Davis, Nicholas. "What Is the Fourth Industrial Revolution?" World Economic Forum. World Economic Forum, 19 Jan. 2016. Web. <19>.
7
 Shankleman, Jess, and Chris Martin. "Solar Could Beat Coal to Become the Cheapest Power on Earth." Bloomberg.com. Bloomberg, 02 Jan. 2017. Web. 27 Feb. 2017. <https://www.bloomberg.com/news/articles/2017-01-03/for-cheapest-power-on-earth-look-skyward-as-coal-falls-to-solar>.
8
 "Bloomberg Businessweek - GE, the 124 Year Old Startup." Bloomberg.com. Bloomberg, 21 Mar. 2016. Web. 27 Feb. 2017. <https://www.bloomberg.com/news/videos/2016-03-21/bloomberg-businessweek-ge-the-124-year-old-startup>.
9
 Laurino, Carmel. "'Kalsada' and the Road to Better Coffee." Rappler. Rappler, 21 Mar. 2015. Web. 27 Feb. 2017. <http://www.rappler.com/move-ph/balikbayan/voices/87554-kalsada-road-better-coffee>.
10
 Davis, Nicholas. "What Is the Fourth Industrial Revolution?" World Economic Forum. World Economic Forum, 19 Jan. 2016. Web. <19>.
11
 "Home." Womensphere. N.p., n.d. Web. 27 Feb. 2017. <http://www.womensphere.org/>.
12
  "Home." Send and Receive Automated Call and SMS Text Campaigns. N.p., n.d. Web. 27 Feb. 2017. <https://www.engagespark.com/>.
13
 Davis, Nicholas. "What Is the Fourth Industrial Revolution?" World Economic Forum. World Economic Forum, 19 Jan. 2016. Web. <19>.
14
 Schwab, Klaus. "The Fourth Industrial Revolution: What It Means, How to Respond." World Economic Forum. World Economic Forum, 14 Jan. 2016. Web. <https://www.weforum.org/agenda/2016/01/the-fourth-industrial-revolution-what-it-means-and-how-to-respond>.
15
 Schwab, Klaus. "The Fourth Industrial Revolution: What It Means, How to Respond." World Economic Forum. World Economic Forum, 14 Jan. 2016. Web. <https://www.weforum.org/agenda/2016/01/the-fourth-industrial-revolution-what-it-means-and-how-to-respond>.
16
 Schwab, Klaus. "The Fourth Industrial Revolution: What It Means, How to Respond." World Economic Forum. World Economic Forum, 14 Jan. 2016. Web. <https://www.weforum.org/agenda/2016/01/the-fourth-industrial-revolution-what-it-means-and-how-to-respond>.
17
 Sagan, Carl, and Ann Druyan. Pale Blue Dot. S.I.: Ballantine, 2011. Print.
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Authors
Kathleen Largo

Passionate about entrepreneurial management and social innovation, Kathleen works with non-profit organizations, startups, and small local businesses.

Sam Ramos-Jones

A political researcher, writer, and digital content curator, advocating for the democratization of public policy discussions in the Philippines.

Enzo Pinga

Enzo Pinga is a farmer and entrepreneur seeking to grow the food movement in the Philippines.

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