Question

Consider this scenario, a company management is considering developing its next work planning using the triple bottom line principles as its framework. 1/. Describe what triple bottom principles is? 2/. Describe/Explain in step by step process as how management can develop its next work planning framework using Triple Based Line Principles? (Within Australian Accounting Environment) (Please type up your answer)

Answer 1

1. The triple bottom line principles/framework is an accounting framework that incorporates three dimensions of performance – social, environmental and financial. A triple bottom line framework is different from a traditional accounting reporting framework. A traditional accounting reporting framework is only concerned with the financial aspects and it completely ignores the social and environmental aspects. The triple bottom line framework, on the other hand, is not only concerned with profits (financial dimension) but also with people (social dimension) and planet (environmental dimension). Thus a triple bottom line framework measures not only the degree of economic value with regards to a company but also its social responsibility as well as its environmental impact.

2. In the context of Australian Accounting Environment organizations can develop their next work planning framework while determining strategies for sustainable growth. Australian companies are required to disclose its impact on natural as well as human capital, besides its financial capital. Organizations are required to be transparent and take responsibility for the non financial impacts of their activities as well. Thus the planning framework for companies in Australia has to factor in non financial impacts like impact on community and on the environment. Australian companies, while developing their next work planning framework, should identify its different stakeholders and then answer the following questions – who are impacted by the activities of the organization?, of those impacted whose opinion is a priority?, of those impacted who currently receives reports on activities of interest?, whose information need are not being met by the current reporting activities?. Thus in the context of Australian Accounting Environment organizations can develop their next work planning framework in such a manner so as to ensure that all affected stakeholders are able to satisfy their information needs through the reporting activities of the concerned company.