Monthly Archives: April 2016

Why is the triple bottom line so important?

It’s not enough in today’s society for companies to simply act good, they must also be seen to be doing good and acting as an example citizen.

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Corporate Social Responsibility (CSR) is a way in which businesses can maintain reputation whilst bettering society. A recent study found that 55% of consumers were willing to pay more for a product or service providing it came from a socially responsible company.  “Corporations now must honor their obligations to all constituents, including their effects on society as a whole. We now hear managers talking about the “triple bottom line.” The bottom line is triple because it now must account for financial, social and environmental performance.” (Coombs and Holladay, 2009, pp.277).

Today it is becoming a necessity for any given organisation to have a social role and to promote good within society. Peach presents this as a metaphor exploring the impact of a business on its environment (After Peach 1987: 191-193). Peach argues that every organisation has basic responsibilities, at a basic level they need to obey laws and pay taxes.

Already many companies will fall at the first hurdle, companies such as Apple, Google, Starbucks and Amazon have all faced damaging tax avoidance scandals. These are the types of businesses that can learn from Peach by making an effort with organizational and societal responsibilities and minimizing the negative effects of environmental pollution in order to work towards a healthy society. I’m not saying every business model out there becomes an advocate for philanthropy, although it is time for many of them to become a more corporate citizen.

I think it’s really interesting that some practitioners are arguing that CSR is not enough anymore… Au reviour CSR, bonjour corporate citizenship!

The basis of this argument is basically due to the fact that CSR focuses on people and seems to exclude environmental responsibilities and ignores the green agenda. Practitioners supporting this claim that there are flaws in CSR and have created a more rounded notion of ‘corporate citizenship.’

The triple line, CSR and corporate citizenship are all vital to the preservation of reputation, companies today are expected to be economic and socially ethical as well as holding an environmental conscience within their practices. 

Was reputation more important before the 21st century?

Ok, trick question… Maintaining reputation is today more important than ever!

According to the Chartered Institute of Public Relations (CIPR) Reputation is “the result of what you do, what you say, and what others say about you.”

In today’s media landscape, issues can arise easily for organisations and sometimes out of the blue. It’s unlikely for any organisation to never have to worry about maintaining reputation or facing issues/crises. Social media is a dominant factor in this. Everybody is aware that the consumer has a voice now, this voice can be deadly to an organisation if the experience of their customers is anything short of a positive one.

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In the current digital era, organisations communicate online. Online platforms are used to generate conversation and allow for a two-way channel of fluid communication. This is mostly great news for businesses, especially the more interactive ones. However, the result of normality of immediacy on social media has meant that issues can crop up quicker and stories can become broadcast because of negative news agendas being grasped.  

So, the result of a more open society with access to an abyss of immediate online interaction has of course made it more important for reputation to be seen as an asset to be invested in. Traditionally, reach was measured in column inches achieved, now it’s measured in clicks, impressions and views. It’s important to remember that our audience is more involved now which is why planning for issues and putting back up strategies into motion is an essential part of maintaining reputation.

For small businesses, a few negative reviews online can really be harmful to your relationship with potential customers. For larger organisations, a Twitter storm can spread like wildfire and before you know it you’ve made the headlines, realising that ‘all publicity’ is in fact not always good publicity.