Triple Bottom Line: People, Planet, and Profit
Shippers, Sustainability • Published on August 10, 2020
At some point in every company’s evolution — whether it be at the inception or farther down the line — the sustainability conversation will arise. Incorporating sustainable business practices might be driven by internal proponents; as a result of the need to keep up with the competition; or, quite often, by consumer demand. Recent data is showing customers feel better about themselves when the companies they do business with have sustainable practices and therefore hold the products they buy to higher standards.
As organizations look through the lens of sustainability, some choose to employ the “Triple Bottom Line” accounting framework — also known as “people, planet, and profit”. Is the company operating in a way that is good for all three? Does doing good for people and the planet impact profit in a positive or negative way? Can sustainable operations actually have a positive impact on all three?
To dive deeper into the Triple Bottom Line philosophy, we spoke to Ryan Emmons, Co-Founder & CEO at Waiākea, which produces and sells Waiākea Hawaiian Volcanic Water, one of the fastest-growing beverage companies in the United States. Waiākea runs on a triple bottom line platform built on healthful, sustainable and ethical standards. Of particular note is that for every liter of Waiākea sold, the company donates 650 liters to rural communities in need in Africa and throughout the world.
We spoke to Ryan about how his company balances the three key principles of Triple Bottom Line and posed the following questions:
- Can you tell us more about your triple bottom line business?
- If a business is evolving to be more sustainable, when does it make sense for companies to invest in sustainability as a core part of their business?
- How is sustainability beneficial for marketing?
- What is “greenwashing” and how can consumers tell which brands are authentically practicing sustainability versus inauthentically marketing themselves as sustainable?
- What do you think it’s going to take for more companies to make large investments in sustainability?
Ryan offers a pragmatic look into sustainability including how it impacts a company’s bottom line; which of the principles of people, planet, and profit should come first; why an organization can justify charging a premium for a more sustainable product; the positive sustainability factor in consumer packaged goods; the downfalls of greenwashing; and how to build consumer loyalty through sustainability.
Watch the video or read the transcription below.
Jennifer Wong: Hi everyone. My name is Jennifer. I’m the head of sustainability at Convoy. Thank you for tuning into this interview series where you’ll hear directly from leaders on how they’ve transformed corporate cultures and transitioned their companies as sustainability leaders. Today, we have Ryan Emmons joining us, the CEO of Waiakea. Waiakea is one of the fastest growing beverage companies in the United States. You’ve probably seen some of their products right in your neighborhood store. Waiakea runs a triple bottom line platform built on helpful, sustainable, and ethical standards. For example, for every liter of Waiakea sold, the company donates 650 liters to real communities in need. So, Ryan, thank you for taking the time to join us today.
Ryan Emmons: Happy to be here.
Jennifer: Awesome. Well to kick things off, I think something that I think a lot of companies are always very curious about, could you tell us more about your triple bottom line business? I think that’s exactly the type of sustainability integration that most businesses are really striving for as they really think about integrating or introducing sustainability.
Ryan: Yeah, for sure. So, I think it’s definitely, like, I think the first question is, you know, what its triple bottom line. Its obviously people, planet, profit. I think its kind of in that order, although sometimes obviously you can put planet before people but I think you got to kind of put people first because then that kind of enables you to be more effective for the things that you’re doing for the planet. So, yeah, for the people part, you know, as a Hawaiian company, our first priority is to really be an active member of the Hawaiian community. So, we’re always trying to expand [2:00] these efforts. We have two things that we’re doing right now which I’m really excited for which is, we’re hiring a new director for our cocoa initiative, which is we basically invest in a number of different community projects. Every single one of our employees is paid for a full day every single month to volunteer, locally, in Hilo and we’re super excited about that. Then we’re also going to have a fund allocated towards certain community projects. Sometimes that’s removing invasive species, what have you. So its really quite the mix and then we have also pump aid, which is something we’ve been doing for a long, long time which is a week supply of clean water is donated for every single liter that you buy. So, we actually install these UN award winning elephant pumps in rural Malawi Africa. Malawi we specifically targeted because it has the lowest per capita water consumption in the world. And so, you know, we felt very fortunate, we have access to this incredible resource with a recharge rate of, you know, 1.4 billion gallons a day, its crazy. So where can we do the most impact for people that have pretty much nothing? And so that’s why we target Malawi and we’ve given access to clean water to over 50,000 people at this point. So, it’s been great. So regarding the planet stuff, so again, Mālama i ka ‘āina is respect and care for the land so we bottle, it starts with us bottling less than .003% of our sources sustainable yield and our aquifer is actually one of the most sustainable fresh water resources in the world with a recharge rate of 1.4 billion gallons a day. Other things that we’ve done since the beginning is we use 100% rPET, 100% of recycled materials in all of our packaging, that gives us a 90% smaller carbon footprint, [4:00] water footprint, energy footprint than competitors and we’ve been doing it for 8 years. A couple people are starting to do it now so that’s always been a huge part of our legacy. We’re also launching aluminum and glass lines as well and we’ll be launching those alongside the launch of our own technology which is called Oceanplast, which is the first packaging of its kind where basically we are taking post recycled plaster material and converting it into essentially wax. So, you have no biomagnification within the animals, within the food chain. So now food chain disruption. You’re removing 99% of possible microplastics. Its really the first like end of life option but at the same time its actually fully recyclable. So, our goal is really to have every sustainable type of packaging. They each have their own quirks; they each have their pros and cons. Obviously we think that ours has the least cons but then customers can at least pick and choose, and they’ll at least be educated in why. And then lastly, we are certified carbon neutral. We have a completely net zero supply chain across the board, partially through working with you guys, with Convoy, and then also through a lot of our electrification initiatives. Our facility runs off of renewable energy, etc. And then the last part I guess is profit which is not a big focus for us because we really haven’t turned a very big profit at this point. But this is how we ultimately keep the business going. Sustainable margins and profit is you’re able to reinvest so that you’re able to grow, so you can support your community even more. And the premium water, it’s a very competitive industry and so if we can figure out the profit portion, then obviously [6:00] we’re able to give more and really kind of create that legacy and make sure that it’s a sustainable legacy. So yeah.
Jennifer: That’s amazing. Well thank you for sharing kind of that brief overview. I didn’t even realize some of the new project and initiatives you’ve got going on. I’m excited to learn more. For businesses today that are really starting to evolve and starting to think about sustainability, what would you say makes the most sense for a company to start investing in sustainability if they haven’t yet? Do you kind of have any advice for companies to think about when they are thinking about taking their first steps?
Ryan: Yeah, I think that you, if we hadn’t done the switch and tried to figure out the 100% upcycle materials, that rPET, early on, it’s just so much harder to make that transition later on. That’s just as an example because, you know, its 3x more expensive as regular version PDT. So a company that is really well established that thinks they have grossed margins that are pretty good and then suddenly, you know, there’s an initiative that’s going to decrease their grossed margins by 20%, so suddenly they can’t support their business versus start having it as a starting point and working from there and only improving on everything else, that’s the advantage to really starting early. And, you know, if you’re going to start with these higher costs, because unfortunately, the majority of the time, at least in our industry, a lot of the sustainability initiatives are more expensive. I think that you can really start to streamline things. But there’s some things in terms of, you know, I think if you start and that’s a quarter of your business and it’s one of your pillars, then you can prioritize is effectively [8:00] and that means, you know, when it comes to having these discussions with your part owners or your investors, you can prioritize those budgets. And I think in the long term, they always pay off but sometimes its hard when you just aren’t having those conversations up from the creation and the first, like, two years of your forming your brand or you company.
Jennifer: So, for your business, you’ve already invested a lot in kind of sustainable products, materials, and innovations. How did you think about really justifying that, like you mentioned, to all of your different stakeholders when short term, it might cost more for the business but you that it is the right business decision if you look at the long term sustainability?
Ryan: Yeah, I think when you’re putting together a strategic roadmap, you’re looking at what are the big differentiators and, you know, it’s going to obviously vary per category or what business you’re doing, what business you’re in. You know, for us, starting with lets say the, you know, the rPET and the upcycle packaging, that was probably our first big initiative that we did right off the bat, and the justification was that we could really command a premium because we saw a lot of demographic trends that were showing that people were willing to pay a 51% premium for products that weren’t just shameless greenwashing, they would say, “Oh, we’re recyclable.” Well, all PDT was recyclable. And so that was a big part of it and then seeing how sustainability was going to become a much bigger factor in CBD and the consumer packaged goods. So, if we could kind of be, you know, the one that was upfront. The idea was that we could kind of be known as [10:00] the sustainable leader and that would obviously create more conversations with buyers because they are going to be reaching out for those products. Who are you going to think of? You’ll think of us. So that’s panned out really really well. At the same time, you know, I think in this day and age also we have the importance of being able to tell a story and be able to have the intrinsic satisfaction of knowing that when you’re consuming something or when you’re buying certain product, you feel good about it and we wanted to make sure that was a part of that story so that we also could have really loyal customers. So yeah, we just had a lot of these frank discussions back in the day. A lot of people didn’t invest in us and, you know, we kind of struggled along there. You know, my family and a few of my partners still own the company, but you know, I’m really really glad that we didn’t make any exceptions and we continued with, kind of, our original core ideologies.
Jennifer: Yeah. I think that’s fantastic. I think you really have developed a reputation for being a sustainable leader in your category and one thing that you mentioned, I’m curious to hear more of your perspective, is the concept of greenwashing. You kind of mentioned that some brands might use greenwashing as a way to try to capitalize on the tension of sustainability but from a consumer point of view, how do people tell if brands are really showing up authentically in their sustainable practices versus maybe using some of the mirror and smoke to try to take along to the sustainability, kind of, buzz words these days?
Ryan: Yeah, there’s a recent case that a competitor is basically, I probably shouldn’t address the situation, but basically [12:00] their marketing their packaging as something that its not at all and they’ve gotten a third party certification that they are actually owners of to validate that it is this type of packaging. And what it does it, exactly what you said, its smoke in mirrors that leads brands intentionally misleading consumers into thinking that they’re more sustainable and, you know, what consumers should do, and I think this is kind of consumer education. Consumers are very trusting I feel like to a large extent to a lot of brands but that’s kind of changing here. I think there is going to be more third-party validation, you know, to really hold people accountable so people definitely should be checking brands websites, making sure that there’s sources, again, third party accreditation. I think when it comes to greenwashing, I think what we need to do is, you talk about the consumer trust and I think the key is, especially in a category like ours, you know, there’s a lot of devitalization for bottled water and a lot of it is for just cost, but a lot of these issues are systemic throughout the entire consumer package beverage industry and that’s the reality. And so I think the key is not to expect brands to be perfect but to look for continued progress and look at these companies that are investing and trying to be transparent and, because the problem the brands that are doing the work and are making the investment, and are bringing in these stakeholders to try to change the industry from the inside out, [14:00] if suddenly other brands that aren’t doing these things are kind of getting away with it, sometimes my brand might get flack. And its kind of a pile on mentality at that point and so I think we can’t scare brands away from adopting sustainable practices by immediately trolling them for not doing enough, and that is kind of the opposite side of, you know, greenwashing is bad because suddenly it creates a bad, there’s so much negativity for the entire industry and all these other players who are actually doing everything right and are actually investing, like I said, the time and the money and the energy. And so, you know, I just wish there was an even playing field and this is the problem. Is, you know, its just a matter of we have to make sure the consumers aren’t feeling like they’re being tricked and I think once you get over that and you’ve able to be transparent and you’re able to have this open dialogue with consumers, some of them which, you know, maybe are harder, you know, than others but I ultimately think there’s always progress at the end of that tunnel and you end up with a consumer that is super loyal because they know that you’re going above and beyond to be transparent and you’re acknowledging the things that you aren’t doing and you’re also acknowledging that you are actively working on those things. But yeah, it’s a super long-winded answer. Its kind of complicated but especially in my industry, unfortunately it’s an industry that’s really been known for a lot of it and so its kind of our job to hopefully call those people out and at the same time kind of make sure that we have a new way of transparency, and again, third party validation.
Jennifer: Right. I think you definitely called that out in terms of consumers [16:00] wanting that transparency and when brands are able to kind of admit to the things that they’re still working on as well as highlight the things that they’re great at, that’s really how brands are able to build a lot more authenticity in their kind of brand today.
Ryan: For sure.
Jennifer: And I just have one more question as we wrap things up today. Again, thank you for just spending time just to share more about Waiakea’s story and just sustainable journey. My last question is just from your point of view, what is it going to take for more companies to make large investments in sustainability? Because every company is kind of on their own sustainability journey today, but is there something that you see that is really going to be the catalyst for more companies to make progress faster?
Ryan: Yeah. I mean, I think it’s a data driven economy these days and I think consumer demand for sustainable products and for, I think that’s really what’s going to drive that change. And, you know, its going to be a couple brands, hopefully like us, and there’s plenty of others that are, you know, doing exceedingly well in beating out, you know, a lot of competitors in their categories. That’s going to make a lot of people kind of, start to question why and if sustainability is a big part of that business model, they’re going to know why. And then, that’s kind of how you get change. So, yeah, I think its when sustainability basically becomes like the must have for capitalism, I think that shift is starting to happen right now because people are realizing that you can’t not address climate change, and you can’t not address sustainable packaging because you just won’t sell and I think we’re still kind of 5 years away [18:00] from that big shift but we’ve definitely been starting to see that over the last 10 to 20 years.
Jennifer: Awesome. Well, thank you again so much for your time, Ryan.
Ryan: Yeah, thank you.