The Sigma Project

Introduction How to use Foreword Executive summary SIGMA Principles Principles at a glance Accountability The 5 capitals Natural capital Human capital Social capital Manufactured capital Financial capital Other approaches Management Framework Views on the Guidelines

How the SIGMA Guiding Principles relate to other approaches

The concept of a ‘triple bottom line’ is widely used to describe sustainable development in an organisational context, setting out organisational performance in terms of three bottom lines – social, economic and environmental. It is a popular and powerful concept. The SIGMA Guiding Principles build on and develop this idea by offering the concept of protecting and enhancing five types of capital under an umbrella of organisational accountability. This approach is intended to illustrate the dynamic nature of sustainable development. By utilising the five capitals model it is possible to overcome some of the weaknesses of the triple bottom line concept, for example, the temptation to trade off social, economic and environmental factors as if they were equal (when environmental integrity is actually a prerequisite for society and the economy) and can be treated in isolation from one another (when, in fact, they are very often interrelated).

The SIGMA Guiding Principles seek to make it clearer that these five types of capital are interrelated and, there f o re, need to be managed, protected and enhanced in an integrated fashion. The five capitals emphasise the underpinning nature of natural capital, as well as the fact that financial capital is simply an expression of the value of the other capitals.

SIGMA believes these distinctions are helpful to organisations, particularly when they are creating a vision and principles for sustainable development.

The two approaches – the triple bottom line and the five capitals model – are complementary, with manufactured and financial capital being reflected in the economic bottom line, human and social capital representing the social bottom line, and natural capital paralleling the environmental aspect of the triple bottom line. Indeed the triple bottom line approach has been used in other parts of the SIGMA Guidelines and in many of the SIGMA tools.

There are also a number of other codes and principles that organisations may choose to adopt or align with, for example the UN Global Compact, The Global Sullivan Principles, The OECD Guidelines for Multinational Enterprises, or Amnesty International’s Human Rights Guidance for companies. The ‘SIGMA Guide to Guidelines and Standards relevant to sustainable development’ surveys 20 such codes that may be of interest to organisations.

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