This is a presentation of The Triple Bottom Line by Alexis Dogwe, Camille Eusebio, Maurice Gonzales, Leslee May Tandoc and Al Marie Tating as part of the requirements in the subject: Marketing and Commercialization of High Technology Products.
University of the Philippines, Technology Management Center
1. MANAGING THE TRIPLE
BOTTOM LINE
MARCH 15, 2016
DOGWE, ALEXIS
EUSEBIO, CAMILLE
GONZALES, MAURICE
TANDOC, LESLEE MAY
TATING, AL MARIE
UNIVERSITY OF THE PHILIPPINES
TECHNOLOGY MANAGEMENT CENTER
Under the Management of Prof. Ed Cruz
2. OUTLINE
A. The Triple Bottom
Line
B. Corporate Social
Responsibility
C. Serving BOP Markets
D. The Digital Divide
E. Responding to
Global Climate
Change in the
Corporate World
F. Framework for
Navigating Ethical
Issues
4. PEOPLE
oSocial structure of the
organization
oStakeholders of the project
oEnsures fair trade and ethical
practices are observed within the
eco-system of the organization
5. PLANET
oFor a business to survive, it has
to earn profit but needs to
understand sustainability
oSustainability
6. PROFIT
the economic value created by
the company, or the economic
benefit to the surrounding
community and society
Source: Triple Bottom Line
Definition |
Investopedia http://www.investo
pedia.com/terms/t/triple-
bottom-
line.asp#ixzz42hNc6nyu
13. RECAP
1. People
2. Planet
3. Profit
Triple Bottom Line
Corporate Social Responsibility
Business initiatives that mold economic objectives (profit) with social
welfare
18. DESIRED OUTCOMES OF CSR
Business Goals
Driving revenue growth
through CSR initiatives
Social Goals
Improve quality of life and to
build capacity in
disadvantaged communities
19. CSR DOMAINS
PEOPLE
People includes employees,
suppliers, customers, people in
the local community where the
business operates, or society as
a whole.
PLANET
Engaging in environmentally
responsible, sustainable
business practices.
21. MODELS OF AND
APPROACHES TO CSR
Business Case
Model
The ability of CSR to create
positive business results
CSR is viewed as relevant
only when it translates
unambiguously to
competitive advantage.
22. MODELS OF AND
APPROACHES TO CSR
Social Values Model
Social issue is the “force” that
drives the organization
23. MODELS OF AND
APPROACHES TO CSR
Syncretic Stewardship
Model
Syncretize means “To unite and
harmonize”
Combines, integrates,
negotiates and balances the
competing claims of varied
stakeholders.
Model 1:
Business
Case
Model 2:
Social
Values
Model 3: Syncretic
Stewardship
Model
25. MEASURING OUTCOMES AND
EFFECTIVENESS OF CSR
INITIATIVES
How does a company
evaluate its
performance for the
triple bottom line?
How does a company's
social performance
relate to its financial
performance?
26. EVALUATING TRIPLE BOTTOM
LINE PERFORMANCE
AccountAbility and CSR Network: Strategy,
Governance, Stakeholder Involvement, Follow-
through
Vodaphone (#5, with a score of 66.3) Deutsche
Telekom (#33)
GE (#13, with a score of 59.1) Sony (#34)
Toyota (#38) HP (#24)
Siemens (#41) Toshiba
(#30)
28. EVALUATING TRIPLE BOTTOM
LINE PERFORMANCE
o Companies must
evaluate their social
and environmental
performance
o A company should
proactively monitor its
own performance,
using one of the
generally accepted
frameworks
29. EVALUATING TRIPLE BOTTOM
LINE PERFORMANCE
AccountAbility's AA1000 standard
Verite's Monitoring Guidelines to
assess sweatshop labor and labor
abuses
Social Accountability
International's SA8000 standard
for human rights
The FTSE4Good Index, an
evaluation of CSR performance
of companies
GlobeScan's Corporate Social
Responsibility Monitor
SOCIAL ACCOUNTING
30. EVALUATING TRIPLE BOTTOM
LINE PERFORMANCE
Environmental Guidelines
oThe Global Reporting Initiative's
Sustainability Reporting
Guidelines
oCERES
oInstitute 4 Sustainability
oGreen Globe
Certification/Standard
oThe ISO 14000 environmental
management standard
31. CORPORATE SOCIAL
PERFORMANCE AND ITS
FINANCIAL
PERFORMANCEattract quality employees
and customer loyalty
VSadditional leverage
create new
opportunities
raise the firm's
costs
unnecessary
expenditures
detract from its focus on
profit
32. CORPORATE SOCIAL
PERFORMANCE AND ITS
FINANCIAL
PERFORMANCE
From Innovest Rankings:
Companies that received relatively high scores for
corporate social responsibility (including BP and Sony)
but whose financial (stock market) values did not
perform well.
Companies that received lower scores for corporate
social performance (including Apple and Nintendo) but
whose stock market prices did perform well.
34. BEST-PRACTICES
CSR
Link CSR to Business Strategy
Supply/input conditions
Microsoft - information technology
education infrastructure
GlaxoSmithKline - access of poor
people to medications and vaccines
attract scientists.
Demand/customer conditions
Competitive context
Supporting infrastructure
36. BEST-PRACTICES CSR
Beware of unintended
reputation effects (Hypocrisy)
oFocus CSR initiatives into areas
unrelated to the firm’s business
oAvoid using socially responsible
behaviors for compensating socially
irresponsible ones
40. PHILIPPINES & USA
LOWER CLASS
(< $35k annual household income)
MIDDLE CLASS
($35k - $200k annual
household income)
UPPER CLASS
(> $200k annual household income)
5.6%
60.6%
33.8%
Gov’t / NGO
Assistance
NGO
Corp Donations/
Philantrophy
Enlightened CSR/
Social Entrepreneurship
41. DOMAINS FOR
INTERVENTION
2 Dimensions:
1. Happens in top or base of the
pyramid
2. Caused by a crisis or is
chronic
CRISIS
CHRONIC
BOP TOP
1 2
3 4
AID/DONATIONS
CAPACITY BUILDING
42. THE 10 GREAT DIVIDES
1. Demographic Divide
2. Financial Divide
3. Nutritional Divide
4. Natural Resource Divide
5. Environmental Divide
6. Health Divide
7. Gender Divide
8. Educational Divide
9. Digital Divide
10. Security Divide
43. BUSINESS MODELS TO SOLVE
BOP
BOP 1.0 “Selling to the
Poor”
Potential customers
Deep listening
Reduce price
Redesign packaging
Extend distribution
Mediated by NGOs
BOP 2.0 “Business Co-
Venturing”
Business partners
Deep dialogue
Expand imagination
Build shared commitment
Marry capabilities
Direct, personal relationships
facilitated by NGOs
“ENLIGHTENED” CSR
View of People
Model of Engagement
Business Solution
Nature of Relationship
44.
45.
46.
47.
48. BUSINESS MODELS TO SOLVE BOP
Power of small businesses to create
innovative solutions
Belief that everyone has innate
capacity to contribute to
development
Primary focus is value creation
Willing to share insights &
innovations
SOCIAL
ENTREPRENEURSHIP
Phase I: Opening Up
Phase II:
Building the
Ecosystem
Phase III:
Enterprise
Creation
CO-CREATION
49. SOCIAL ENTREPRENEURSHIP
LEVERAGED
NONPROFIT VENTURE
Drive adoption of
innovation
Requires external
partners for support
One Laptop Per Child
Organization
HYBRID NONPROFIT
VENTURE
Recover portion of cost
Sets up several legal
entities
Envirofit
Aravind Eye Care
SOCIAL BUSINESS
VENTURE
For-profit business
setup
Reinvest profits to grow
the venture and reach
more people
50. 5 KEY AREAS TO CONSIDER
DISTRIBUTION
• Poor roads, high
transportation cost
• Localize value creation
PRICING
• Price needs to be slashed
• “Surplus revenue” to subsidize
• Community based pricing
OPEN SOURCE & LICENSING
• Rely on open source models
to reuse, adapt or modify
RESPONDING TO FAILURE
• Fail early & fail fast
• Learning labs for new
insights
MEASUREMENT CHALLENGES
• BOP impact assessment
framework
1 3
2
4
5
52. THE DIGITAL DIVIDE
Disparity in technology access
between:
o Socioeconomic groups
o Geographic areas
o Ethnic groups
o Countries
“if technology revolution leaves
some behind, all will suffer”
53. SOLUTIONS TO THE DIGITAL DIVIDE
Public Policy
Nonprofit Ventures
Training & education
Market-based solutions
Mobile telephony
Mobile Telephony
• Cheaper phones
• Market preference over other
gadgets
• Provides access to different apps
61. BEST PRACTICES
ENVIRONMENTAL STRATEGY: A
FOUR-STEP APPROACH
Quantify the
company’s
carbon
footprint.
Assess carbon-
related risks
and
opportunities.
Adapt the
company’s
business
strategy.
Stay ahead of
competitors.
63. CHALLENGES FOR
ENVIRONMENTALLY
RESPONSIBLE BUSINESS
PRACTICES
unintended
consequences
• Use of crops for
human consumption
for processing
biofuels
greenwashing
• energy-efficient
electronics that have
hazardous materials
• products claiming to
be “organic” without
verifiable proof
fairness and equity for
developing nations
• growth in China,
India and other
developing countries
cause GHG emissions
to also rise (1/3 of
global emissions as
of 2004)
65. FRAMEWORK FOR
NAVIGATING ETHICAL ISSUES
Identify all
stakeholders who
are affected by the
situation
For each
stakeholder group,
identify its needs
and concerns, both
if the decision is
implemented and if
decision is not
implemented.
Prioritize the
stakeholder groups
and perspectives.
Make and
implement a
decision.
66. FRAMEWORK FOR
NAVIGATING ETHICAL ISSUES
Case Study: Merck and the Cure to River-blindness
in 1978, onchocerciasis or “river-blindness”
plagued at least 85 million people
caused by a parasitic worm carried by a tiny black
fly that thrives along fast-moving rivers
the larvae the adult worm reproduces invades the
eyes and often cause blindness
disease was so prevalent that children thought
blindness is part of growing up
Merck has discovered that a drug which was used to
eliminate insect-borne parasites in cows also has
properties that can eliminate the cause of river-
blindness
67. FRAMEWORK FOR
NAVIGATING ETHICAL ISSUESIdentify all
stakeholders who
are affected by the
situation• shareholders
• public at large
• Third World population
• government
• employees
For each
stakeholder group,
identify its needs
and concerns, both
if the decision is
implemented and if
decision is not
implemented.
• negative impacts on
profits vs negative
publicity
• favorable vs insincere
• quality of life enhanced
vs backlash against
corporations in
developing countries
• expedite approval
process vs possible
intervention to require
licensing
• belt-tightening/ lay-
offs vs de-moralization
Prioritize the
stakeholder groups
and perspectives.• “We try never to forget
that medicine is for the
people. It is not for
profits. The profits
follow, and if we have
remembered that, they
have never failed to
appear. The better we
have remembered it,
the larger they have
been.”
Make and
implement a
decision.• pursue the study of the
drug
68. WRAP-UP
People
• Corporate Social
Responsibility
• Social
Entrepreneurship
• Serving BOP
Markets
• Bridging the
Digital Divide
Profit
Planet
• Corporate Social
Responsibility
• Environmental
Strategy Best
Practices
• Natural
Capitalism
• Cap and Trade
69. REFERENCES
1. Marketing of High Technology Products & Innovations by Jakki
Mohr et al.
2. http://www.investopedia.com/terms/t/triple-bottom-line.asp
3. The Economist – The Triple Bottomline
4. https://www.cdp.net/CDPResults/carbon-action-infographic-
2015.PDF
Notas del editor
It aims to measure the financial, social and environmental performance of the corporation over a period of time.
What you measure is what you get, because what you measure is what you are likely to pay attention to.
Use child labor as an example and Blood Diamond
When employees and stakeholders are engaged, there is drive to create revenues to achieve the objective of the company.
-
Growing awareness of corporate malpractice in these areas forced several companies, including Nike and Tesco, to re-examine their sourcing policies and to keep a closer eye on the ethical standards of their suppliers in places as far apart as Mexico and Bangladesh, where labour markets are unregulated and manufacturers are able to ride roughshod over social and environmental standards.
Being environmentally conscious is one way of considering operating efficiency.
Example: When an organization purchases office supplies made from recycled materials, not only does it save the trees (paper), it also works with Finance on minimizing costs for the company. Recycled office supplies are usually lower in price.
CSR is different from Corporate Sustainability. Corporate Sustainability is a business approach that creates long-term shareholder value by embracing opportunities and managing risks deriving from economic, environmental and social developments.
Yes. The company has multiple benefits.
No. Primary role of the business is to serve a company’s stockholders.
CSR is just superficial window dressing
CSR is an attempt to preempt the role of government as a watchdog of the society
Fair trade, no child labor, safe working environment, corporate philantrophy
Play Rachel’s video
60% of total population at the bottom
Philippine setting (source: NCSB – national statistic coordination board)
Developed countries (source: US Census)
Why we serve them? Sheer size of market – expanding your market reach
Goal: Move them up to create a diamond
How to help them? Public aid/assistance to market-based approach
Market-based – use business tools to work with the market: CO-CREATION
Effect: increase opportunity to earn income and empower them to move up the ladder
Source: “Will the Recent Robust Economic Growth Rate are Burgeoning Middle Class in the Philippines” by former NSCB Sec-Gen Romulo A. Virola, et. Al
http://www.myfinancemd.com/aldub-and-philippine-tax-reform/
http://www.rappler.com/thought-leaders/65114-filipino-middle-class-over-taxed
Problems can be characterized on at least 2 dimensions
Crisis – typhoon, earthquake, tsunami
Chronic – hunger, poverty, illiteracy
Another way to dimension the chronic problems of the BOP
Demographic trends – aging of population, rural vs urban
Inequities in wealth distribution
Famine, hunger, malnutrition
Abuse of resources essential to living – energy, clean air, water
Sanitation, waste, toxins - Need for environmentally sustainable practices
Access to health care & medicines, spread of diseases (malaria,
Equality for women
Learning opportunities for everynoe
Access to information communications & technology
Poverty is a threat to world peace – need to bridge financial divide
1st generation BOP failed – only goal is to sell to the poor, if they are able to sell to them, it will solve the problem
If they all become consumers, we would have a problem on supply & demand – raw materials, waste management, danger to climate
BOP 2.0 engages in Co-creation which creates enduring community value – marrying resources & capabilities of the firm and community – promoting innovation that is tailor fit to the local needs (embed / localize)
Before you start the presentation, probe and ask questions.
Sample questions that can be asked from the client:
Ask how the organization raise funds? How do they collect donations?
Do you get donations frequently?
What do they do? Proponents of the organization? Abroad or local?
Do they have a website?
Who maintains / handles the site? Did you hire a web developer?
Do you have someone in-house IT?
Let them talk. Listen then when they are ready to listen to us, introduce UShare.
Ushare started as a spark of an idea. Non-profit organizations form a unique segment who are in the business of gathering donations- locally and globally.
Let me show you what we’ve done for our UShare clients:
One major Non profit organization is Red Cross. We enabled UShare in Oct 2011 and in Dec 2011 the Tragedy of Sendong happened.
Ushare was up and running in red cross that enabled them to collect 2.4M in 4 days.
For the Yolanda Typhoon, Red Cross through UShare, received more than Php140M in 17 days from all over the world.
With online, with more payment channels, people gave more.
This is a case that Ushare is in action.
More executions:
Most bigger NPOs have their website such as ABS CBN so we empower them with a donation button.
Caritas Manila is also a major NPO that is using UShare.
LEVERAGED
Market: poorest of the poor / those with no access and who cannot afford
Goal: adoption of innovation that addresses a social need – multiplier effect thru communities & organizations
Support: financial, political, in kind/donations
low-cost laptops for school children thru governments in developing countries
HYBRID
Recover thru selling goods & services
Legal entities: income generation & fund raising/charity
SOCIAL
Setup from the outset but they think differently from mainstream businesses on the profits
Goal is to drive social/environmental change and not to maximize shareholder returns
http://www.schwabfound.org/content/what-social-entrepreneur
Consider in the BOP market initiative
Distribution: capacity building & training; Build local ecosystem of vendors; franchising
Pricing: surplus from wealthy customers to subsidize for poor;
Open source: rely to reuse, adapt & modify existing innovations – i.e. GSK working with local companies to produce generic drugs
Failure: learn from failure, it is part of success; new insights can be applied to established markets not just BOP
Disparity can manifest in diff. ways, between different:
socioeconomic: affluent vs poor / income brackets
Geographic: urban vs rural
Ethnic: caucasian vs african
Countries: developed vs developing
Technology is a key enabler to close the different divides. Providing access to technology could stimulate economic development.
Public policy: internet access to all – Philippine project:
Market preference: due to cost, convenience, no need for literacy (unlike computers)
Access to diff apps that improve lives: jobs, medical care, remittance of money, chatting with family abroad
Even with thousands of ATMS, do people have bank accounts?
Only 26.6% have bank accounts, much less ATMs
In far-flung places where ATM penetration or credit card acceptance is low, need creative solutions to enable financial transactions.
There are over 600 banks and 6,300 non-banks with quasi banking funtions
36 Universal banks, 71 thrift banks, 533 rural banks, 6,300 non-banks with quasi banking functions
ALL LICENSED BY THE CENTRAL BANK
NO ONE INSTITUTION OR ORGANIZATION CAN DO IT ALONE
Now I would like to share with you the story of TSPI and their customers, the nanays. TSPI is a client of Unionbank, their clients are in remote areas. The challenge was how to help our client with their business. And this is that story.