Originally For Jan 30, contribution to UN & UN NGO Major Groups collection of SDG’s .
Why a World SDG? Partly it’s because our world economy works as a whole, we need an integrated information base for making decisions, a “Knowledge Commons”, to present a unified view of what it means for every part to use every other. It’s a holistic method of presenting the best available information on the economy and all its connections to use in making holistic decisions, by presenting the whole cost of GDP beside its current benefits,
… a scientifically designed financial and ESG balance sheet, so people can better understand economic choices.
Governments need checks and balances. Financial accounts need credits and debits. GDP also needs a balance of benefits and liabilities to be really meaningful, but presently leaves the liabilities out. This is about what you can do with a scientific balance sheet method to holistically measure them. The first assumption is that earning a share of GDP comes with having responsibility for a share of the costs of generating that part of the world’s wealth. That is accountable as a share of the whole economy’s “measurable externalities”, to also be associated with financial costs to our future that can be well-defined and estimated. It’s a matter of pulling all the data together in units of “fractions of the whole”, and improving on how the shares are distributed over time, making sure the total of the fraction stays equal to the whole. Combined with the new science for whole system measurement, SEA (using natural boundaries), it provides a fully accountable method of measuring economic responsibility.
We’ve all known so much about the impacts. We just didn’t understand what portion we paid for. We didn’t know that having a system that works as a whole also makes us responsible for part of its whole impacts too. We didn’t know for sure that we’re not just responsible for the ones that are easy to see. From well-constructed measures of our shares of global responsibility for the economy’s impacts, we could make much better choices for our future. Civil society and governments would set the primary goals as by defining world SDG’s. Economists and scientists can refine the measurement methods, and safe distances from societal, economic and environmental harms. Then the business community and finance can make economically viable proposals for serving the goals within our planetary, economic and societal boundaries, and gain community acceptance as cultural viable. Then investors can select from the most profitable having assurance of favorable treatment from government, as our holistic societal measure of what is societally worth investing in. [ed 5/3/14]
For introduction to the rigorous systems science behind using “shares of GDP” to measure shares of responsibility for its impacts on the earth, see the articles:
A World SDG is a “commons approach”
· Full accountability for the rising economic costs of an unsustainable future
· Finance motivated to invest in the SDG’s close to our hearts.
· An integrated balance sheet of local and global responsibilities for integrated implementing of SDG’s.
New science makes it possible to give those who profit from growing our costly economic impacts the information they’d need to understand their growing global liability. What would be more profitable choices for all can then reverse that. It’s shocking, really, when one finds what a $1 dollar share of GDP (where the averages apply) is responsible for, as a $1 share of today’s economy’s fast growing impacts. Every average $1 of GDP is responsible for close to 1lb of CO2 put in the atmosphere! So in a sentence you just replace “dollar” with “pounds of CO2” to speak about the climate impact of normal earning and spending. For a consumer with a $50k income, the climate impact is 50k pounds of CO2 per year!
The worst part is that including other economic impact costs, it probably exceeds $25k per year in future societal liabilities[a], just for the impacts of the CO2. [ a. $25k is an educated estimate for scale, based on an optimal $7,500 cost for using bio-char to sequester 25 tons of CO2.] There are also many other societal liabilities for economic impacts we have shares in too. We also have the strains of growing inequities, of the maintenance of aging complex infrastructure, the sudden shifts in competition stranding valued sectors of society, and of course growing public debt from the burden of the costs, as if a public subsidy for businesses neglecting their own futures, resource depletions of all kinds. For CO2 the costs include needing to replace the world’s energy systems, recover from major economic losses due to coastal damage from rising oceans, the greatly increased risks of disasters and drought, the decreased productivity of oceans and arable land, among others, further unsustainable impact on bio-diversity. The people investing our wealth are acting as our fiduciaries with a legal duty to invest wisely for us, need to know about the financial liabilities they’ve been overlooking in our names. Our growing “externalities” are depleting the resilience of all natural systems on earth and of all human societies at the same time, making everything we rely on more hazard prone. What the World SDG envisions is a standard World System balance sheet, one that would display our individual and collective shares of responsibility for the environmental services causing the impacts, that providing our fraction of GDP requires. Equating our share of GDP with a responsibility for shares of its total impacts is one of those “simple” concepts that is usually accurate too 4. The balance sheet would also put the measurable financial benefits and liabilities for them, side by side too. Seeing it laid out like that we’ll understand that paying for ever growing impacts cannot be a free service of society, as business has treated it to date, and we’ll take responsibility. Historically we have priced our future resources at $0 value, because nature doesn’t take money, encouraging unwise decisions to invest in ever growing impacts, also valued at $0. The new standard balance sheet can start with those impacts we can measure, with costs for the ones we can reasonably predict, and become more comprehensive and complete over time. Every business would compile and publish it in annual reports, so all levels of decision making in the world to see. Then everyone will understand from the grass roots to the wealthiest of the wealthy, the sciences and governments, will all see the situation, and great need for making economically, environmentally and culturally sustainable choices, fulfilling mankind’s SDG’s. At first a UN sponsored institute, somewhat like the IPCC, would lead the collaborative development of this model design for how to provide everyone on earth the information people need for understanding their individual and collective responsibilities for the economy’s known impacts on the earth , to better understand the goals and targets toward which their efforts need to be aimed. Led by the HLPF, the World SDG would end up shifting large quantities of investment funds from unsustainable to sustainable investments, both steering the developed world onto a sustainable path, and drawing investors into fully funding the several special SDG’s near and dear to everyone’s heart. I call them the “bright green spots” valued as having high impact on steering the world toward true sustainability. It would fund well-planned development ventures: to eliminate cultures of poverty, equitably manage fresh water, create accountable governments, saving the diversity of life. It would do it with competitive holistic entrepreneurial planning, as that’s what would become most profitable as sustainable development. It would completely reorient our world financial systems, providing clear purposes beyond just accumulating money, offering hard and clear measures of the sustainability of finance too, and the societal costs for how finance steers the economy their profits might be held liable for. It would make very clear that needless delay or failure to achieve world sustainability would be unacceptably costly in every way. This broad and idealistic intent is based on three reliable main premises:
- § Economic investors, businesses, consumers and regulators will make better choices in their own and our common interest if they have information that shows them. The future would come to have economic value. Choices with delayed effects would then be valued in the present, such as if simple rules about capital gains treatment depended on the societal liabilities incurred, effectively internalizing all measurable externalities.
- § The scientific method 4 for measuring individual and collective responsibility as a share of our global economic impacts is already available, and can be successively improved upon with further scientific study.
- § For all natural systems, growth comes before sustainability, first for expanding its structures and uses of its environment, and then to stabilize, securing its niche and relationships within others. It makes the goal of “sustainability” a transition from using the economy to consume and control ever more of the earth as a rule, to making the earth our home by caring for ourselves and our place in nature.
- § A Sustainable Earth Footprint
- § And method for thoughtfully managing earth systems
We have always needed an SDG for reducing our global footprint, in a way that would thoughtfully manage world economic systems to do so. The secret to it is having a method for informing businesses, consumers, investors, regulators and markets, on the impacts their own and each other’s decisions cause. The barrier has been the two extraordinary gaps in the information people have had, for making economic decisions. Those are what the new science changes, exposing how economies are guided by searching the world for what’s profitable, and how to include in the accounting both the costs people can count and their fair shares of the costs of the whole people can’t directly count. How economies evolve is more like organisms, with highly distributed decision making, developing by organic growth, following market choices for connecting resources and needs around the world as every part creatively searches their own environment for ways to further their interests. The information on our economic impacts has previously left out the distributed impacts we pay for when purchasing goods and services but can’t trace, often 4 or more times the impacts anyone can trace. Even the visible impacts were not put in terms of the economic values on which decisions are mostly made, as accumulative costs to our future, so the information didn’t alter decisions. Some of the scientific methods for matching economic choices to environmental footprints are for tracing direct Impacts, like LCA2 (Life Cycle Assessment). Others estimate responsibility for shares of renewable resources, EF 3 (Ecological Footprint), and EI 4 (Economic Impact) combines those with shares of responsibility for known impacts that other methods leave unaccounted for. There are also various scientific aggregators of ecological, social and governance impact data (ESG) as qualitative impacts associated with economic causes. Combined with the financial liability for the impact responsibilities that can be priced, the integrated balance sheet, or Total Balance information would be used to let the markets , regulators, investors, businesses and consumers all make more profitable decisions using their roles to steer the whole.
Goals and Targets
The principal goal is to guide our World System toward a profitable and comfortable relationship with the earth, following a path of profitability. From a natural systems view, sustainability is a shift from investing in quantitative to investing in qualitative development. Long term profitability would guides every part of society as it searches for its own interests, leading the whole toward being sustainably and profitable, creating the world we want, and our home on earth, as a commons shared with the rest of nature. The initial steps
· Collaboration between economic and physical scientists, with government cooperation to:
1. Set standards for measuring accumulative total costs to our future from economic impacts
2. Set standards for business annual reports on combined present and future impacts.
· Collaboration between information system designers and cultural learning specialists to:
3. Design of the information systems for presenting crosscutting profiles of both economic and cultural data, to allow discussions for all interests on the Total Balance of their choices.
4. For societies to study for ways to implement their SDG’s
· Collaboration of finance and business for using the Total Balance system & SDG’s to:
5. Obtain market funding for sound business plans responding to long term cultural and environmental interests.
Cross-cutting Issues Bringing out unseen cross cutting issues is a primary intention of the World SDG. It’s hard to know where to start if trying to list them. A variety of legal, governance, educational, as well as cultural, development efforts would come about as a result of using this approach to sustainability. Some would needed for the it to work smoothly. Two examples that might be pivotal are:
· Restoring the original meaning of “fiduciary” back to being a duty to serve the interests of the “person” for whom professional services are given, not just their the financial gains, so the operational meaning would naturally become to make decisions for others that are measurably sustainable.
· Creating a network of “sustainability librarians” for extension services to societies around the world, to facilitate the sharing of sustainability information and experiences in every society
Placing the Position The actual text the 2014 UN statement of Post2015 SDG’s could be fairly simple. “We commit ourselves to the ‘World SDG’, as a unified approach to integrating all the SDG’s, informing people of their individual and collective responsibilities for our impacts on the earth and costs of their choices to our future, for coordination by the HLPF and UN agencies. Monitoring and Evaluation For tracking a system for monitoring global data and responsibilities for the earth system, indicators to indicate its success would include those for the design of the information system, including ways to rate information displays for Transparency, Accuracy, Relevance, etc. Implementation would involve different kinds of test launches, in different communities, to study the methods that are most useful. To track both the economic as well as cultural and environmental success, rating by the business community on how helpful it is for entrepreneurial decision making and cultural understanding of the societal choices made. Next Steps The first steps would follow from the world conversation among nations, to follow the publication of the 2014 Post 2015 SDG’s. Then based on that, the next big step would be to involve getting the professional communities most needed for the project, to become engaged In it, maybe with each having a “design competition” for their roles in the process, a fairly exciting prospect in itself.
It’s rather inevitable that we will find out how very unprofitable our present economic course is, acting as if intent on continuing to double our demands on the earth and ourselves too, several times a century, for as long as we can. There really is no form of technology that would permit ever growing consumption without consumption, as sometimes called “decoupling”. So rather than trusting in mirages, the responsibility is to learn better places to put our money, to make the earth profitable and comfortable as a place to live and call home. ________________________ 1 Based on World SDG 8 Jan 14 Jessie Henshaw IPS Statement for OWG7 based on her “Ideal Model – Ideal Model: New Architecture” 2 LCA is the world standard method for assessing traceable impact, and the one on which most others are based 3 EF is renewable footprinting by the Global Footprinting Network 4EI is biophysical economic systems accounting: Henshaw, King & Zarnikau 2011“Systems Energy Assessment” in Sustainability MDPI see http://synapse9.com/signals/2013/12/08/ideal-model-new-architecture and http://synapse9.com/SEA