The document discusses the concept of triple bottom line reporting and whether it is a real change or just window dressing. It provides background on evolving societal and economic issues like population growth, resource consumption, and accountability. The document also outlines emerging solutions like corporate social responsibility and sustainability reporting to address these issues. It argues that accounting professionals need to participate in these solutions and provides examples of frameworks, standards, and initiatives that are driving more comprehensive reporting on environmental, social, and economic impacts.

1. TRIPLE BOTTOM LINE
Is it fact or fiction? Real change or flavour of
the day? Reality or window-dressing?
By
Nick A. Shepherd FCMC, FCGA, FCCA, FCMI
www.nickshepherd.ca
OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s 1
problems and prepare for tomorrow’s challenges.

2. Agenda
• What’s the issue
– Why should we care?
• The facts (maybe...)
• Some solutions
• Action
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OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

3. THE ISSUE AND SOME
BACKGROUND AND WHY WE
SHOULD CARE
Why is there an issue?
OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s 3
problems and prepare for tomorrow’s challenges.

4. My journey – or “how I came to care...”
• Family business / retailing
• Engineer – entertainment
• Accounting
• General management
• Consulting
– Service & quality management
– Process management
– Leadership & team development
– Intangibles and knowledge management
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OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

5. Societies evolve over time
Middle
Up to 1880 1880 - 1945 1945 - 1985 1985 - 2030 Post 2030
Ages
Industrial
Leisure /
Hunting Agricultural Knowledge
cosmic?
Manufacturing Services
RESULTS OF SOCIETAL EVOLUTION =
Frameworks for societal governance (including institutions)
Note also “The Empathetic Civilization” Jeremy Rifkin
OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

6. ..and society changes…
Movement to “tipping point...”
www.telegraph.co.uk
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OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

7. Issue – accountability and transparency
• Core aspects have evolved
– “Corporate capital”
• From financial dominance to knowledge
dominance
– “Human engagement”
• From buying labour to buying knowledge
and wisdom (on loan versus “buy?”)
– “The world”
• From localization to highly populated
globalization
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OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

8. Are we really accountable today?
• Concerns over
– Ethical conduct and power
– Environment
– Social impact of business on
communities
– Sustainability of enterprise
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OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

9. THE (DEVELOPING) FACTS
What we do know about what changes are taking place
Assets employed, Environmental inputs and
outputs, relationship building and “fairness”
OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s 9
problems and prepare for tomorrow’s challenges.

10. Changing base of assets employed
• From tangible assets to
intangible assets
– The 80 / 20 rule
• Annual survey
– Brand Finance (UK)
– Top 10,000 corporations
– $54 trillion invested
– Intangibles moved to be
75% of assets by 2007
– Broad range –
technology, health care
much higher
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OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

11. It’s not just about $ invested Stakeholders
interests
It’s about the “value...”
Organizational
Capital
Industrial age Knowledge age
Organizations Financial Intellectual
INCREASED STRATEGIC
VALUE
Asset base Capital Capital
DECLINING STRATEGIC
Base for Structured Non Structured
accountability reporting reporting
Base for Well defined No reporting
comparability standards standards
VALUE
Assurance 3rd party audit No 3rd party
process & Audit &
verification verification
OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

12. Population growth
• 1 AD 250 million
• 1800 (1800) – 1 billion
• 1930 (130) – 2 billion
• 1960 (30) – 3 billion
• 1975 (15) – 4 billion
• 1987 (12) – 5 billion
• 2000 (13) – 6 billion
• 2011 (11) – 7 billion
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OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

13. A changing world – energy consumption
A Wikipedia common resource 13
OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

14. CO2 Emissions
• 375 parts / million
• Highest in 420,000 years
• Probably for 20M years
• Some consider near “non
recoverable tipping point?”
• Drivers include:
– Energy intensity
– Population growth
– Land use change
World Resources Institute: UNEP/GRID-Arendal
• Caribbean ~ 5% 14
OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

15. Growth in world trade = relationships
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OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

16. “De-composing organizations”
Governance /
Oversight
Governance / Policy /
Oversight direction
Policy / Design / Manufacture /
direction Design /
Development Manufacture /
Design / Service
Development Manufacture /
Service
Design / Development Delivery
Manufacture /
Service
Delivery
Development Service
Delivery
Delivery
Manufacture /
Service
Delivery Post
Post
Delivery It’s all about relationships
Post
Delivery
support
Post Post
Delivery
support with external (as well as
Delivery Delivery
support
support support internal) “partners.”
OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

17. Occupy Movement
• 82 countries, 95 cities
• Growing momentum for
change
– Social activation
– “Something’s wrong...”
• Political changes (mid East...)
• Economic (financial crisis)
– Ethics / bail-out then bonus
• Varying responses + and –
– “Missed opportunity”
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Wikipedia
OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

18. Why accountants need to participate
Once social change begins, it cannot be reversed. You cannot uneducate the person
who has learned to read. You cannot humiliate the person who feels pride. You cannot
oppress the people who are not afraid anymore. We have seen the future, and the
future is ours
Cesar Chavez; “SUSTAINABILITY” - THE
American activist ABILITY TO OPERATE AS A GOING CONCERN
1927-1993
“License to operate” “Capacity to operate”
Sustainability Sustainability
SOCIETAL FOCUS ORGANIZATION FOCUS
Public perception
Intangibles and
CORPORATE VALUE and
Tangibles
social accountability
OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

19. SOME ACTIVITIES AND
SOLUTIONS
Who is doing what today? What change is already taking
place? What do we see ahead?
OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s 19
problems and prepare for tomorrow’s challenges.

20. What brings this together
Corporate Social Responsibility (CSR) is the
continuing commitment by business to
behave ethically and contribute to economic
development while improving the quality of
life of the workforce and their families as well
as of the local community and society at
large’.
WORLD BUSINESS COUNCIL FOR SUSTAINABLE DEVELOPMENT
“Making Good Business Sense” 20
OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

21. Triple Bottom Line
Ben & Jerry Evolved CSR
• Planet • Social
• People • Economic
• Profits • Environmental
John Elkington, 1994 SustainAbility
OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

22. Investor focused interest
• 19.9% of total assets under management (2008)
• $700.1B Investment Funds Institute of Canada
• $1,859.4 Investment Managers
• $470.5 Large pension funds
• TOTAL $3,011.1 B
OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

23. Carbon Disclosure Project
OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

25. Externalities – drivers of change
Addressing “externalities” is key to taking responsibility
for an organizations behaviour.
The late Ray Anderson was founder and chairman of
Interface Inc., the world's largest manufacturer of
modular carpet for commercial and residential
applications and a leading producer of commercial
broadloom and commercial
fabrics.
He defined sustainability as "taking nothing from
the earth that is not rapidly and naturally
renewable, and doing no harm to the biosphere."
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OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

26. “Externalities”
• What are “externalities?”
– “In economics an externality is a cost or
benefit, not transmitted through
prices, incurred by a party who did not
agree to the action causing the cost or
benefit”
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OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

27. **
** Featured in “Values Driven
Business”
OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

28. The SIGMA Project:
The five capitals:
• Financial capital
• Human capital
• Manufactured capital
• Social capital
• Natural capital
NOTE: Context of the SIGMA project was initially
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sustainability in terms of CSR
OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

29. IIRC Conceptual Model
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OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

30. Growing trend of reports
Corporate Register
OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

31. Emerging Assurance Business
OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

32. Evolution of reporting
OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

33. ACTION PLANNING – WHAT
ARE YOU GOING TO DO?
True leadership is about being ahead of the pack and having a
vision for the future and a set of values that underpin your
behaviour.
OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s 33
problems and prepare for tomorrow’s challenges.

34. 34
OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.

35. Take a look at the web site for free downloads and other items
Follow me on “Twitter” and read the blog?
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OUR MISSION
Providing leaders and managers with education, tools and training to solve today’s
problems and prepare for tomorrow’s challenges.