BUS8521

Leadership, Management and

Social Responsibility
Assignment 1
Pooja Shah - 21704171

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In this essay we will introduce quadruple bottom line concept, from where it has originated and how it
has evolved since the term has been coined. The essay will embark into how companies concerned for
stakeholders are high quality procedures, enjoying more sustainable business and higher performance.
We will further discuss two New Zealand based companies namely The Warehouse and NZ Bus on how
they have incorporated QBL in their business and also evaluate their commitment towards the same. This
brings to our next level of discussion on the key role of leadership and management in achieving
sustainable development goals. In addition, we will discuss on few examples of corporate compassion in
New Zealand and around the world. We will summarize in the end how QBL can be advantageous not just
to the business and the community on the whole and if there is any better frame work that exist.

The term ‘Triple Bottom Line’ (TBL) was coined by John Elkington in the year 1994. ‘Triple bottom line
focuses corporations not just on the economic value they add, but also on the environmental and social
value they add – and destroy. At its narrowest, the term ‘triple bottom line’ is used as a framework
for measuring and reporting corporate performance against economic, social and environmental
parameters.’ This led to the formulation of 3P’s “people, planet and profits” which was later adopted by
Shell for its first Shell report in 1997. The TBL agenda are based on seven drivers also known as ‘seven
sustainability revolutions’ as shown in the diagram below:

(Henriques, 2004)

The 3P’s which stands for ‘people, planet and profit’, are explained below:

1. “People”
It refers to unbiased and favorable business practice towards employees, the community and
region in which the organization operates its business. A TBL organization considers a mutual
social structure in which the health of the corporate, employees and other stakeholder’s interest
are interdependent. Under the TBL concept the employees are paid fair wages and not exploited
by any means. It also encourages to give back to the community it operates in by means of good
education and health care system. Accounting of people bottom line is new and it’s often
problematic as it is very subjective in nature to quantify. The Global Reporting Initiative (GRI) have
developed guidelines to report social impact of a business.

2. “Planet”
It is also known as the natural capital and it pertains to sustainable environmental practices. A TBL
company tries to conserve the by reducing its ecological footprint by using the energy and non-
renewable resources cautiously. The TBL Company ensures to reduce the manufacturing waste

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 and the toxic level of the waste dispose in safe and legal manner. A company bond by TBL thinking
is bond by the thought of “cradle to grave” which means it takes into consideration the cost it will
incur from sourcing of its raw material to marketing the product to disposing of the waste. The
TBL Company will not produce any goods which are harmful or dangerous in nature. Depletion of
endangering resources is always under check. The sustainability reports metrics are easily
quantifiable and standardized for environmental issue. No. of reporting institutes and registries
are there for environmental reporting like Global Reporting Initiatives, CERES, Institute 4
Sustainability and others.

3. “Profit”
Profit is seen as the economic value that the organization creates after accounting for all the
cost. Therefore it is different from the traditional method of calculating profit. In TBL, profit is
seen as the economic benefits enjoyed by the society at large.

(Onyali, 2014)

The advocates of Quadruple Bottom Line (QBL) concept felt that there was one key element
which was missing in TBL, which led to the birth of the 4th P purpose. Therefore, QBL came into
existence. While the TBL concept is about transparency, QBL concept is about transcendence in
addition to transparency.

4. “Purpose”
The 4th P was initially introduced by Ayman Sawaf as spirituality as the fourth bottom line. (Sawaf
& Gabrielle, 2014) In business the 4th P stands for purpose. A company can create purpose by 3
ways:
1. Creating purpose for customers, users or participants,
2. Creating purpose for employees, and
3. Building purpose through supply chain.
(The Quadruple Bottom Line: Adding purpose to the mix, 2014)
QBL businesses are purpose-driven, they are not only profit driven but with a purpose to make a
positive impact on the environment and for the culture and spiritual health of their employees,
customers, and communities.
(Quadruple Bottom Line, 2016)

Companies don’t operate in isolation. Value creation is center of any business, in order to achieve
its goal the business needs to acknowledge the context in which it operates. A company is
connected to a network of interrelated individuals called stakeholders they might be employees,
customers, society and the environment. (Perrini & Tencati, 2006) The 21st century business
demand to create value for its stakeholders and not just shareholders as this is what creates a
more sustainable and high performing business. As we all are aware of ‘The Great Recession of
the late 2000s’ has made it very clear, that the way we were encouraging business to think is not
appropriate. In the 21st century we faced too much of uncertainty as the focus was on ‘maximizing
profits this quarter’ for the shareholders. This led to the demise of investment banking company

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 Lehman Brothers, the bankruptcy of automotive company General Motors Corp., and the crash
of countless smaller businesses. (Freeman & Elms, 2018)

Let’s look at the RELX Group case study as how companies who focus on their stakeholders and
not just shareholders are likely to be high quality producers of products and services and maintain
good relationships with sustainable business and higher performance.

RELX Group was established in the year 1993 when the businesses of the British publisher Reed
International and the Dutch publisher Elsevier NV merged. They are the global provider of
information and analytics for professional and business customer across industries. RELX group
internal stakeholders include investors or shareholders and employees while external
stakeholders include customers, supplier, government, society, community, and CR network.
RELX Group’s CR undertakings concentrates on doing what is apt for the business and its
stakeholders, keeping all parts of the business in balance. RELX Group pays attention to the
expectations and needs of all its stakeholders. The company believes that by living up to its
responsibility to contribute positively to its employees, customers, society and the environment
through its business, it has a sustainable business model leading to growth.
(Corporate responsibility and stakeholders, n.d.)

The two New Zealand owned companies that we will be evaluating for their commitment to the
QBL or aspects of it is ‘The Warehouse’ and ‘NZ Bus’.

The warehouse otherwise known as the red stores was opened by Sir Stephen Tindall in Auckland
in the year 1982. The warehouse is part of the warehouse group who also owns Noel Leeming,
Torpedo7 group and warehouse stationery. There are totally 66 stores, which contributes to the
revenue of $1.7m i.e., 60% of the total sales turnover of ‘The Warehouse groups’. The warehouse
was open with the objective of bringing together everything which New Zealanders want or need
at an affordable price – “Making the desirable affordable and the affordable desirable”. The vision
of the warehouse is to build a company that delivers long-term sustainable profit growth and
helps Aotearoa New Zealand flourish. (FY17 annual results, 2017) (Annual report 2016, 2016)

The company started with a purpose which is “Making the desirable affordable and the affordable
desirable” for the New Zealanders. The warehouse for helping the communities have been
associated with 5 leading charities at national level which help the families in three key areas:
education, well-being and youth employment. It has raised total funds of NZD 1,340,927 for
helping the community it operates in. The Warehouse commitment towards environment is seen
from second year of reporting Greenhouse Gas Emissions, it has also achieved Certified Emissions
Measurement and Reduction Scheme, (CEMARS®). In addition above warehouse also purchase it
products in an environmentally sustainable manner, it is also into plastic bag and recycling and
waste and recycling. It ensures that it employees are taken care by providing them a safe
environment to work in and employees are taken care by providing competitive wages and
salaries, performance based compensation and long service leave. As we notice from the
warehouse annual report that the company is able to make sustainable economic profit year after

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 year. The Warehouse has been an exemplary example of following QBL while making economic
profits and sustainable business and high performance.
(Annual report 2016, 2016)

NZ Bus was established in the year 1992, when Stagecoach purchased Wellington City Transport.
Earlier it was known as New Zealand public transport, in the year 2006 it was rebranded to NZ
Bus. The NZ Bus now holds total contract value of NZ $ 997 million in Auckland and approximately
$323 million in Wellington.
(Who Are We?, n.d.)

NZ Bus was formed with a vision and value of being recognized as ‘the Australasian leader in
passenger transport’, ‘Reliability’, ‘Respect’ and ‘Fit for Purpose’. NZ Bus is committed to
supporting the communities in which they operate by partnering and sponsorship arrangements
with many organization based in Wellington and Auckland. As part of their environmental aspect
of QBL, they have undertaken sustainability reporting. They also have ‘Environmental
Management Policy‘ which focus on Preventing pollution, complying with all applicable
environmental legislation, and continually improving our environmental performance. For the
employees, the NZ Bus has laid various policies health and safety policy to ensure safe
environment for the employees to work in. NZ Bus has been earning economical profits by
winning contracts year on year while providing outstanding services to the New Zealanders.
(NZ Bus, n.d.)

Leadership and Management play and important role as we see from the above two examples.
The leaders are the champions of the change not only with in the business but even outside. That
role will become even more crucial because profound change is to be addressed in QBL reporting.
The leaders and the management should demonstrate leadership by: ‘Providing a framework for
checks and balances, showing individual leadership in action and ensuring appropriate succession
planning and leadership development’.

As we are becoming more aware of the environment that we live in so are the companies.
Companies in this era are showing corporate compassion by their entrepreneurship in what their
organization can contribute to the world. There are four themes to corporate compassion, they
are: contributions, Business Spirituality, Social Sustainability and Work Smarter. (Corporate
Compassion, n.d.) Let’s have a look at few examples of companies in New Zealand and across the
world showing corporate compassion. The Auckland airport, Air New Zealand, Skycity
Entertainment in New Zealand has been carrying out various corporate social responsibilities
empowering people through education, helping people into sustainable employment protecting
the natural environment, community giving and fund raising, Maori engagement, economic
contribution, safety and security, customer, employer satisfaction and balancing the ecological
effect. While companies like Wellington drive technologies, URS New Zealand, Revolution ID have
reduced greenhouse gas emissions and save energy. (Corporate Social Responsibility Report,
2017) (Sizing up the green economy: NZ's top 50, n.d.) Around the world, ITC has contributed for
children primary education, over 4,53,000 children have been benefitted from this programme.
(What we do - corporate social responsibilities, n.d.) Google has made multiple efforts in being

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 good citizen by ensuring the resources are been used effectively through Google Green. Google
has seen an overall drop in power requirements for their data centers by an average of 50 percent.
(Doing Their Part: 3 Excellent Examples of Corporate Social Responsibility, n.d.)

To conclude, QBL is a very important reporting concept. The companies should look beyond just
profit. As the companies don’t operate in isolation they should also take care of their stakeholders
and the environment they operate in. There are many other frame works which a company can
explore to improve its accountability and reporting standards.

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References
(n.d.). Retrieved from NZ Bus: http://www.nzbus.co.nz/

(n.d.). Retrieved from Doing Their Part: 3 Excellent Examples of Corporate Social Responsibility:
https://www.autodesk.com/redshift/doing-their-part-3-excellent-examples-of-corporate-social-
responsibility/

(2016). Annual report 2016. The Warehouse Group. Retrieved from

http://www.thewarehousegroup.co.nz/investor-centre/company-reports

Corporate Compassion. (n.d.). Retrieved from Charter for Compassion:

https://charterforcompassion.org/corporate-compassion

Corporate responsibility and stakeholders. (n.d.). Retrieved from Business Case Studies:
http://businesscasestudies.co.uk/reed-elsevier/corporate-responsibility-and-
stakeholders/conclusion.html

(2017). Corporate Social Responsibility Report.

Freeman, E., & Elms, H. (2018). The Social Responsibility of Business Is to Create Value for Stakeholders.
MITSloan - management review. Retrieved from https://sloanreview.mit.edu/article/the-social-
responsibility-of-business-is-to-create-value-for-stakeholders/

(2017). FY17 annual results. The Warehouse Group. Retrieved from

http://www.thewarehousegroup.co.nz/investor-centre/company-reports

Henriques, A. (2004). Enter the Triple Bottom Line. In A. Henriques, The Triple Bottom Line: Does It All
Add Up. Retrieved from http://www.johnelkington.com/archive/TBL-elkington-chapter.pdf

Onyali, C. I. (2014). Triple Bottom Line Accounting And Sustainable Corporate Performance. Research
Journal of Finance and Accounting, 195-197. Retrieved from
https://www.researchgate.net/publication/284264925_Triple_Bottom_Line_Accounting_And_S
ustainable_Corporate_Performance

Perrini, F., & Tencati, A. (2006). Sustainability and Stakeholder Management: the Need for New
Corporate Performance Evaluation and Reporting Systems. John Wiley & Sons, Ltd and ERP
Environment. Retrieved from
http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.465.7394&rep=rep1&type=pdf

Quadruple Bottom Line. (2016, May 21). Retrieved from 3E Strategies:

http://www.3estrategies.org/blog/2016/03/21/quadruple-bottom-line/

Sawaf, A., & Gabrielle, R. (2014). Scared commerce and Fourth Bottom Line. In A. Sawaf, & R. Gabrielle,
Scared commerce - a blueprint for a new humanity (pp. 19 - 25). EQ Enterprise. Retrieved from
https://cdn.shopify.com/s/files/1/2520/1378/files/sacredcommerce.com.free_f71a9650-61b3-
4c56-93e3-28f8b719af8d.pdf?10318574973771845354

Sizing up the green economy: NZ's top 50. (n.d.). Retrieved from NZ Herald:
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10816101

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The Quadruple Bottom Line: Adding purpose to the mix. (2014). See Change Magazine - The Magazine
of Social Enterpreneurship. Retrieved from http://www.seechangemagazine.com/?p=772

What we do - corporate social responsibilities. (n.d.). Retrieved from ITC portal:

http://www.itcportal.mobi/sustainability/corporate-social-responsibility.aspx

Who Are We? (n.d.). Retrieved from NZ Bus: http://www.nzbus.co.nz/who-are-we

Abbreviations

TBL – Triple Bottom Line

QBL – Qudraple Bottom Line