Triple-bottom-line decision-making: a consideration of confluence

By Alexander Quinn | January 25, 2017

The stakes have never been higher. Governments have always had wide-ranging responsibilities. But today, they’re at whole new levels, sometimes for things that were barely on their radar screens a few decades ago. Like new kinds of mass transit that people actually use and can afford. Well-appointed, energy-efficient infrastructure that can multipurpose; responsible, thoughtfully designed city growth; and broader, more stringent, and sustainable environmental protection.

Decisions about these things have the potential to make our lives better. Our cities more attractive to investment and development. Our natural environments stronger, healthier, and more sustainable.

Or not.

With so much riding on outcomes, considering different options is serious business. It can’t be allowed to happen in a vacuum. We know too much. We’re too aware of ripple effects and the downstream repercussions of not getting it right. The best strategy may be to buy a little insurance up front and invest in the decision-making process itself.

We’ve found a way to do exactly that.

The triple-bottom-line(TBL) framework is a tool for developing, evaluating, and comparing big, complex solutions to many of our modern problems. TBLs promote balanced decisions that generate the highest value, weighing the specific infrastructure need against public goals set by local governments.

With a customized model and a standard questionnaire to list the essentials, project managers can complete assessments and upload them to a centralized database. The program’s decision-support platform pools multiple criteria, applying consistent rules to information and coming up with viable alternatives. Options can be compared to those of other groups of projects—maybe similar ones in different locations, or ones that share some of the same key elements or considerations as yours. Then, it delivers visual representations of potential impacts, sorted the way you want to see or analyze them.

It starts with you identifying factors or components that the TBL framework assigns to one of three areas.

Profitability

Construction expenses, project delivery costs, implementation risks, and financing are some of the obvious issues relating to capital budgets and overall profitability. Operations and maintenance, renewals and replacements, grants or revenue are ongoing factors.

In the TBL paradigm, funding can often improve or be stretched. Planning for structures or measures to reduce flood damage, for instance, can mean insurance savings for the municipality, region, or government, as well as the people living there. In other words, TBL evaluates the entire financial life cycle of the infrastructure investment, setting a standardized evaluation method to let very different project investments be compared to one another.

Environment

The TBL method helps spotlight broader benefits. While not always the case, many infrastructure investments can combine natural elements that increase the local biodiversity of plants, small animals, and birds. Especially when green corridors become the connective tissue between two large natural areas.

Can plans for a sewer system be extended to manage storm water? Can installing a natural filtration system also serve local fauna and provide habitat corridors? Conscious consideration of these additional benefits can lead to additive infrastructure investments that embed solutions for climate, local air quality, and cleaner water in the long-term, often with marginal impacts on project costs.

Social licence

Urban areas can become better social climates. Greater population densities mean more services and a better blend of mixed-use housing. Low-income communities can have more affordable choices for getting to work and finding places to shop. Seniors can get to transit more easily, accessing health care and recreation to counter isolation and loneliness.

With any project, your specific considerations are slotted into one of these areas. But it doesn’t end there. The three areas connect. They overlap and influence each other. The actual number of items and the weights assigned to each is not part of the TBL exercise. Those things vary, project by project; area by area. Different cities attach their own values to the importance of housing, jobs, education, and equity. A TBL approach can’t apply the same social categories and weights to every area. So the model needs to be customized to reflect local values that are clearly established by the jurisdiction. Hatch’s TBL model lets cities establish their own categories and hierarchy for considering the societal consequences of investments, giving it local credibility.

The Green Line, a major light-rail transit program in Calgary, Canada, is a prime example. The project will deliver multiple benefits, as well as cut commute times for workers. Property values are increasing for owners served by the transit line. Air pollution is dropping as people travel less by car, and public health is improving as transit users do more walking and bicycling to and from the stations. Areas are becoming more attractive for businesses, too, as mixed-use urban environments served by transit attract young and productive workers.

The Green Line isn’t just providing broader advantages to the city. It’s specifically aligning with issues around equity, focusing benefits on those who need them most. There’s more money in people’s pockets, more efficient use of government funds, and more healthy communities.

The TBL allows the city to optimize its investments without compromising the core purpose of the infrastructure asset. Simply put, it’s a robust data-analysis tool that helps decision-makers build more balanced and more sensitive solutions.

The TBL works because it forces a consideration of confluence. It’s a multicriteria decision-support platform that looks at all the pieces at the same time, and how they relate to one another. In any set of circumstances, it shows how projects can generate the highest value in environmental improvement, social benefit, and economic gain. It points the way to balanced decisions about where to invest funds and the impact those investments may ultimately have.

It’s a model for doing more, and doing it in a more data-driven, analytical way. Climate action plans; vibrant, safe communities with prospects for growth; and ways to finance them. Win. Win. Win.