The Sustainable Development Goals serve as an urgent call to action for companies to pay as much attention to their extra-financial performance as to their financial performance.
In a previous article, we discussed how a defensive response to the SDGs achieves nothing; and a selective response risks causing negative trade-offs, which undermine any gains. Instead, a holistic response is required: Any company seeking to contribute positively to one or more SDGs must also strive to eliminate any negative contributions elsewhere, due to activities across its value web.
This begs the question: What do ‘positive’ and ‘negative’ really mean in this context? When it comes to financial performance, the answer is clear. A company may make a profit, or it may make a loss — and the transition between the two is called the financial break-even point. When a company breaks even, it is doing just enough to sustain its own existence. But what is the equivalent when it comes to the other two dimensions of the Triple Bottom Line?