For creative industries, success is not solely defined by profit margins. In this vibrant sector, business is about crafting a variety of values that extend far beyond financial gains.
While these contributions may be hard to quantify, accounting for them is important to get a comprehensive evaluation of progress.
With a focus on practical approaches like triple-bottom-line accounting, this article explores the significance of recognising and tracking the values generated by creative businesses.
Beyond the bottom line
Many creatives see business as a journey where they aim to create value beyond mere monetary metrics.
Within this dynamic landscape, success is not only defined by profit margins but is intricately woven into the very fabric of culture, innovation, and societal enrichment.
Creatives view their work as a platform for contributing to the culture as a whole, introducing innovative perspectives, and playing an active role in shaping societal narratives.
The essence of their business lies in the intangible yet powerful impact it has on the world — where each output is a unique and meaningful contribution.
For creatives, the pursuit of value extends far beyond financial gains.
Going beyond monetary metrics
While profits and financial metrics provide a clear picture, they only partially capture the real impact of a creative business.
By understanding and appreciating things like how much a creative business affects culture, brings new ideas, and connects with society, we can better measure its impact. This goes beyond just looking at money and involves considering everything to get a complete picture, reflecting the diverse nature of the creative industry.
However, you can’t escape the fact that individuals in creative fields also have practical needs such as sustenance and financial obligations. Just as it’s unwise to take on work without compensation merely for the promise of exposure, it’s crucial to remember that financial stability is essential for survival.
While passion and exposure are valuable, ensuring that your creative pursuits contribute to your livelihood is equally imperative.
A holistic framework for progress
Enter triple-bottom-line accounting — a pragmatic approach that expands on the traditional profit-centric view.
Triple-bottom-line accounting, often abbreviated as TBL or 3BL, offers a holistic and forward-thinking approach to measuring business success.
This innovative accounting framework takes into account not only financial considerations but also environmental and social factors.
There are many benefits of adopting triple-bottom-line accounting.
Firstly, it encourages businesses to assess their economic impact while simultaneously evaluating their environmental footprint and social responsibility.
Additionally, TBL fosters transparency and accountability, as it prompts organisations to actively engage with their environmental and social responsibilities.
By incorporating these dimensions into financial reporting, businesses can build stronger relationships with stakeholders, attract socially conscious investors, and contribute to a more sustainable and equitable future.
Social factors: Building community and responsibility
Creative businesses play a pivotal role in fostering community engagement.
Beyond the confines of profit margins, these ventures have the power to become catalysts for positive social change.
By actively participating in societal responsibility, creative businesses contribute to the well-being of the communities they serve.
This is more than just paying lip service to corporate social responsibility; it involves actively participating in initiatives that enhance the quality of life for individuals and communities.
By forging meaningful connections with communities and prioritising ethical practices, creative businesses can amplify their influence and contribute to a more responsible and socially conscious business landscape.
And in the long run, these close ties to the community could also reflect positively on their financial statements.
The profound impact creatives have on culture, innovation, and society cannot be underestimated, and for many, these consequences are worth more than any paycheck.
Yet people still need to earn a living, and that’s where companies like Artisan come in. As professional accountants, we thrive on hearing your grandest aspirations and exploring practical strategies to turn them into reality.
From inventors and illustrators to videographers and visual effects specialists, we’re passionate about supporting the creative industries.
Get in touch with us today to see how we can help your business holistically.