Triple bottom line reporting and its impact on financial performance of banks in India

Abstract

Information requirements of diverse range of stakeholders has lead to dramatic shift
in reporting practices from traditional financial reporting framework to encompass financial,
environmental and social dimensions in performance measurement by adopting ‘Triple Bottom
Line' approach. Triple bottom line (TBL) endeavors at moving beyond conventional
performance measurement systems based on profits to integrate environmental and social
parameters to measure corporate performance. Considering the paramount role financial
institutions play in an economy, banking sector must account for environmental and social
impacts of their activities through triple bottom line approach. In this context, this paper
attempts to identify triple bottom line reporting practices on a sample of 83 banks operating in
India through content analysis. Further, Mann Whitney U test was conducted to analyze impact
of triple bottom line reporting on financial performance of banks. Research provides an insight
to banking sector on financial indicators that can lead to enhanced financial performance by
adopting triple bottom line and drive towards sustainability.