Scope-4 impact measures add up the total environmental inputs resulting from business, personal, or policy choices. That’s so we can compare different choices, and make the better one. Sounds like what sustainability metrics should do!
Standard sustainability metrics, however, collect impact information by where they occur,
not by what choices cause them…
So our whole metric system needs to be rethought. Today if a business decision involves employing six new machines and six new people, all that is counted are the impacts of the machines. The impacts of hiring the people or paying the investors or the government… aren’t counted. Nature sees all the kinds of impacts incurred by business decisions exactly the same way, though! It was our accounting community, going back centuries it actually seems, that decided to count one and not the other.
The omitted impacts are actually not hard to scientifically estimate for scale. That’s what Scope-4 accounting does. As you work with it you find more and more ways having the numbers right results in big changes the terms of discussion. The core scientific issue then, is having a metric that does not associate environmental impacts of business with the choices that cause them, but with the locations where the information is collected. That inconsistency may be as fundamental to economic accounting as to have originated in how business records were kept in ancient times on clay tablets.
The [ e = mc^2 ] LAW OF SUSTAINABILITY
ln(e) / ln($) = c
It says our growing earth impacts and growing earth economy are directly coupled.
The natural constant observed, [c], is the coupling of GDP and Energy use, as a measure of everything physical the economy does. It’s expressed as a ratio of their growth rates (here as a ratio of their natural logs). That coupling has been a constant [0.6] for a long time. You see it clearly in the figure below, showing a 40 year official world record for the economy’s growing Energy use and GDP.
It says that our increasing use of energy for altering the planet to make money grows only a little slower than GDP, at 0.6 times the growth rate of GDP, AND that this direct coupling has not shown any tendency to change over time! People imagine that ‘efficiency’ changes the coupling, but even with growing efficiency the ratio has actually quite constant. You’d need global efficiency in energy use to double every ~20 years like GDP generally has to really make a difference, so having growing value in a steady GDP is far more possible.
Of course, like e=mc^2, it’s not possible to tell quite where the natural constant observed comes from. That’s a big part of the scientific interest. Natural constants are emergent properties of the system, seemingly here a natural rate of societal innovation and adaptation, like a “natural learning speed”. The benefit of the constant is giving us a better way to measure inclusive sustainability, using the mathematical implication that:
— average shares of GDP pay for and are responsible for causing
average shares of GDP earth impacts —
The world economy grows as a whole, nob acting at all like the parts…
The power of this rule the direct coupling between responsibility for shares of Earth Impacts and shares of Earth GDP. It’s a measure that combines all the impacts of extracting energy and all the impacts caused by using energy, i.e. everything the economy does, with financial earnings from the economy. When the data is aggregated correctly, it allows a complete accounting of the GDP impacts, and “closed accounting” for shares of responsibility for them. So that for whole supply chains, one can measure their share of exhausting all our resources, forest and species loss, paving over productive land, etc. Delivering goods for an average dollar of GDP causes an average share of the whole economy’s impacts.
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Scope 4 CO2 assessment
The science for applying this constant natural coupling of money and GDP impacts was published in 2011 in a research paper “Systems Energy Assessment” found at the SEA resource site. More detailed research notes are in the article What’s “Scope 4″. The physics is sufficiently general and inclusive that the same technique can be comfortably use globally, to assign responsibility for all impacts of GDP on the earth, and have a way to “internalize all externalities” that can start and remain valid as it is incrementally improved, as in “A World SDG“.
The SEA research study pie chart, 5 time the true impact causation found compared with standard method.
Discussion:
The real tragedy is that this bias in our business impact metrics assigns TOTAL responsibility for environmental impacts to the people who are paid to do them, who would not do them unless they were requested and paid for by someone else.
So then ZERO responsibility is assigned to the people choosing to request and pay for the impacts, communicating their requests for them by the transfer of money.
In criminal law, as when paying to have a crime committed, requesting and paying for it is considered the principle direct cause of the crime. The person paid to do it may be penalized equally or not. As far as physically causing economic externalities, in the court of environmental responsibility, it really should be decided the same sophisticated way.
What Scope-4 accounting does, then, is start from the complete list of things a decision pays for. It could become a tremendously long list, with lots of things only known from the money spent rather than from exactly how the service was provided. So for those you need to do research on what default assumption to make in case in case more detailed information does not become available. I’m still waiting for people to study it themselves and compare results, but I think the proof is completely convincing that absent other information the necessary default assumption is not “zero” but “average”.
Elementary technique:
If you get stuck in deciding what to count, just remember, businesses don’t pay for things except for business reasons, so you need to count *everything*.
You then think about the different categories of spending, and what their “direct” (material) and “indirect” (economic demand) impacts are.
The initial rough estimate rule for economic impacts is to count them at 90% of the world average per $GDP, like around 7000BTU/$.
Make sure you use inflation adjusted $’s and state the index year.
That’s easy to do, and lets you reserve your time for estimating the direct impacts, according to the added information you can collect.
So for the energy content of purchased fuels, for example, you’d count BOTH the direct energy content of the fuel, AND the economic energy impact of the spending, at 90% the world average. The reason is that the fuels come from nature, and the spending goes to people, paying them for the consumption they do to bring you the fuel.
If done correctly, the bottom line is a unique pie slice share of the world’s impacts
for delivering your share of GDP.
Another one to think through is how to estimate the impacts of retained earnings, used for either financial or business expansion investment. The economic impacts of that spending needs to be estimated with a multiplier over time… The whole purpose is to truthfully estimate the types and scale of consequences for our economic decisions.
More discussions can be found searching the journal or the web for “Scope-4” or “SEA-LCA” as interchangeable names for the same group of accounting methods.
I had found a cozy place to work on sustainability from inside the UN, but discovered the words holding the discussion together there had accumulated meanings that were deeply dishonest… so I’m back on the outside.
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Over the past year I developed two rather wonderful scientific learning methods, as if school courses in “Niche Making 101, 102”, for people searching for how to work with nature. One is the 3Step method for learning how your economic commons works and the other the World SDG for making the totality of our growing impacts on the earth transparent to each other. Both were very unexpectedly attacked rather than discussed in the organization I was part of, though, and I’m understanding the offense.
After much suffering, puzzlement and close observation, the harsh reaction to learning by a scientific approach now seems due to it not being sufficiently ideological. Unfortunately… letting up on the ideologies we may use to stamp the world with is the very first rule for learning from nature. Finding that people both didn’t seem to know that, or to be willing to try, is an important lesson I wasn’t prepared to learn, especially that my own social network would respond as if attacked by my suggesting good creative ways to do it .
Ideology is an artificial and inflexible but handy social substitute for reality. By definition ideologies are self-defined, built up as social affirmations in well connected networks. It makes them strong but also largely unable to adapt and respond. For people they provide mental comfort, useful knowledge of group habits, and a private coded language only understood in the network.
How ideologies can open up and become adaptive we often fail to notice, though, how often we naturally change from one to another in the course of a day or week as we engage with different networks. We change ideologies much as if putting on and taking off clothes, often using a change of clothing to do it in fact. So,… it seems sensitive, but need not offend, to notice that ideologies need to be suited to situations and to grow and change with them, letting us try on different ones for fit. Ideologies can be temporarily considered as “nice outfits to wear”, and need not be treated as contracts required of others for whom they don’t fit.
Sadly, the dishonest words this viewpoint helps us understand are some of the favorites in the discussion of sustainability. They’re ways of mixing honorific images of ever accumulating wealth and reducing our footprints on the earth: “sustainable growth”, “decoupling”, “circular economy”, even “sustainable development”. They’re frequently used to compare “apples and oranges” and coming up with “ever increasing consumption without consumption”. With that usage our goal and purpose becomes to accelerate the “tragedy of the commons”, that is our whole discussion is about how to avoid.
How you can tell that for yourself is by observing that putting the contradictory meanings of “development” together requires switching back and forth from one ideology to the other, with that switch not being mentioned. It shows that people, in conversation, are adopting an ideology of hiding when they switch ideologies. Sadly that seems what we have socialized around doing, unaware of the consequence. At present nearly anywhere in the global sustainability movement you go (and I’ve really looked around!), you get strong pushback for even trying to bring it up.
The natural succession of growth and adaptation for sustainable systems, a complex organizational development of internal and external relationships.
Nature doesn’t respond to artful ideology in the least, though. Not one little bit. What nature responds to is the growth of new organisms that change from expanding their conquests to then making their niches. That succession is their (and our) door to joining the commons by making their (and our) homes in it. Feel good euphemisms for the opposite, stitching together our true ideals into fig leaves for endless conquest philosophies like BAU, actually don’t work.
No need to take off our clothes in public… but dropping ideological fig leaves at times
seems required for how we learn.
Offering a true measure of economic sustainability, internalizing the costs of externalities caused by delivering world GDP, initially using shares of GDP to measure shares of GDP impact responsibility; potentially making the world economy 100% accountable.
It’s the “right way to make money”, taking responsibility for the true shares of our costs to the future.
Investing and doing business in the common interest,
…calls for balancing costs and benefits, no longer just counting operational impacts locallyas before, adding up only the impacts over which we have direct control (and can’t hide). Now we need to do impact accounting inclusively, combining in one account both direct operational impacts and direct economic demand impactsestimated as our global shares of the GDP impacts we pay for. That’s the essential step to inclusive accounting, and balancing our benefits from GDP with our real shares of responsibility for the whole economy’s accumulating GDP impacts. It’s needed to guide our choices for moving toward a sustainable future.
To apply it we need to recognize that the supply-chain and service-chain impacts are a *shared responsibility* of the those managing the operations the result from, and the economic demand caused by paying for them. Now the World SDG offers a scientific method for measuring the responsibility of economic demand. Businesses and investors need to make sound sustainable decisions about supply chains reaching around the world, and need accurate information on what is being paid for and profited from to do that. Consumers, shareholders and regulators can then also make sound decisions about what the markets are profiting from. For the glaring cases, regulators could variably tax the profits from dangerous impacts, funds to be transferred to subsidizing the profits for scaling up alternatives, making the investor and buyer jointly responsible with the seller for the important side-effects of their economic services. In principle both buyer and seller are co-equally responsible, liable for long term costs of short term profits, and for being transparent. This way of doing the accounting would help pave a clear path ahead for the economy of the future. 06/26/17, 11/5/18
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Updated Preamble to the 2014 UN Proposal
Following these notes is the original text of the World SDG proposal, to the UN Ministerial “Open Working Group 7” and the UN NGO Major Group and its Commons Cluster, for negotiating the global Sustainable Development Goals (SDG’s). It offers a “whole system accounting” method to give all stakeholders the same transparent information on measurable Environmental, Sustainability and Governance (ESG) impacts of the economy, to help guide economic choices for our future. What makes it work is a new scientific method for much more accurately distributing real responsibility of economic decision makers for their decisions. That new science, for how the world economy works as a whole, is what allows all stakeholders to see their own and each other’s real scale of impacts on the whole caused by their economic decisions. It becomes a learning tool for then guiding our choices for the benefit of the whole, creating a holistic awareness of what’s at stake for consumers, business, investors and governance, and guide efforts for achieving the SDG’s.
Latest 2016 research statements, The links below are to recent UN Statements regarding how our standard ways of measuring sustainability are very selective, and leave the great majority of economic impacts on our future uncounted[1,]. My recent video comment to the UN [2,] on this grand accounting problem is in the webcast of its high level political policy forum for sustainable development (HLPF), its July 11 Session 4: Fostering equitable growth and sustainability . Watching the hour of statements from many experts, countries and organizations will show you how the UN works, and avoids discussion of our ever expanding impacts. My statement is at minute 0:40:40, and others by Youth, Women & Indigenous Major Groups are at minute 1:09:00 to 1:21:00, and quite excellent too.
Our modern environmental accounting standards were based on ancient habits of not counting things we can now measure the effects of. The is largely limiting the information given decision makers to LOCAL impacts, and leaving uncounted their real shares of the GLOBAL impacts. These categorical omissions from what is counted assure that businesses, investors, government and consumers will make sustainability decisions quite unaware of most of the impacts their decisions will cause. What is excluded also tends to be the more neglected and disruptive of our accumulating economic impacts on the earth and society, and so excluding consideration of them in making the decisions that cause them. So sustainability decisions to maximize profits can also be maximizing neglected impacts too!!!
We’ve never had a meaningful balance sheet for the earth, but new science and technology now makes it possible. Our accounting methods started from doing local accounting of impacts, and so didn’t take a whole system view, and that’s still the case. So leaving them out of consideration means it’s only slowing the whole economy that slows its increasing whole effects that are continuing to destroy the earth.
I) The standard way ‘sustainability’ is now measured uses “selective accounting” rules, for addressing ESG impacts, for people, businesses, cities or countries or policies. It’s to count things almost entirely only for what each one directly manages. That counts what each planning group would immediately care about, but it ignores the often much larger remote effects of their commerce on others and the planet, a very deceptive one sided view. For businesses energy use, for example, what is counted is only the energy within its operations, for its equipment and the material uses it manages, or directly traced to them. Even though doing that takes a great deal of effort, it arrives at a total that is highly inaccurate and misleading, due to the more dispersed categories of impacts uncounted.
II) The most general exclusion is of all impacts of financial choices, all treated as ‘zero’, though also very clearly resulting in what is paid for and profited from, by consuming all the services of the economy remotely. The largest part of that exclusion is the financial choice made by businesses to pay their own people, and so economically causing the consumption. Business use of public and private services, and paying investors are also excluded. Also excluded are all those categories of paid services impact for business supply chains. So given that we are now relying on environmental accounts for saving the earth, it’s evident that no one before had been checking what decision makers would be told they were making decisions about.
III) To make real decisions on sustainability decision makers would need to accept co-equal responsibility for their choices to request, pay for and profit from their share of impacts for delivering their share of GDP. Because our responsibility for what we see happening around the world is not traceable you need to count it statistically, and the new research makes that relatively easy. It gives co-equal responsibly for directing the work of a business supply chain with the operations of the supply chain.
The original research (3, 4) found the whole supply chain energy consumption and CO2 pollution of 5 times what the Life Cycle Assessment (LCA) or GreenHouse Gas (GHG) “Scope 1&2” metrics would count, using a wind farm business with heavy technology as model. For less for businesses using less heavy technology, the true impact might be 10 times what is counted, with the more disruptive remote impacts going completely uncounted. The old rules were inherited from practices for simplifying accounting and ignoring things that were hard to count. It reflect the oldest of old habits of thinking, of economies working with separate parts, when since Adam Smith everyone has known they work as a whole.
IV) The World SDG proposes a data network giving access to a transparent inclusive accounting of measurable ESG impacts, a data platform. The starting point is a scientific method of dividing up shares of known impacts of the whole economy, for which any part would be responsibility. The baseline for estimating a share of economic responsibility is the decision maker’s share of the economy, initially counting every share as “average”, and then differentiating if more information is available. So as an impact calculator, any person, business, or country would enter their “income” and first see a display of the known global impacts for that share of world GDP. It would be for helping them choose how to invest their time and money, and guide policy. As research develops, ways to depart from average and take credit for lessening or compensating for impacts would develop.
The principle strategy for the World SDG is to improve the decision making regarding investments, thinking of “investment” more holistically, as both “cultural development” and trying “new directions for the economy”. For operating businesses its ESG balance sheet report would be published along side its annual financial balance sheet report. All stakeholders could view the same “best available information” on all impact factors. When a new investment proposals want public recognition and perhaps qualify for support, they’d go through public reviews. First would for general scientific and economic feasibility, then financial, and then for cultural acceptance and political commitment. From initial to final reviews it would proceed as a “learning practice” going from early concept to final implementation stages. More successful proposals might be seen as “transformational” and become a teamwork of all the stakeholders, not just the initiators.
Our main sustainability impact metrics (2)
LCA (Life Cycle Assessment) accounts for the impacts of recorded uses of technology and materials by individuals and businesses
but not the impacts of OTHER spending and economic choices
EF (ecological footprint) measures our traceable use and flows natural and renewable resources
also not the impacts of OTHER spending and economic choices
The World SDG method combining the omitted economic impacts with scientific measures (3)
EI (economic impact) measures accumulative responsibility of participants in the economy for shares of global ESG impacts of GDP, assumed to be proportional to shares of GDP until improved information is available.
Share of GDP is a reliable measure of our use of the economy, on the currently reliable assumption that the measured economy works as a whole, based on the highly regular relationship seen in the first figure below, of a constant ratio of constant whole system growth rates for GDP, Energy & Energy Efficiency. Also see the Addendum – Background on the Science and references (4, 5a,b)
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Preface
Why a World SDG is both possible and needed is because our world economy works as a whole. We need a truly global way of understanding the impacts of our decisions, to crate a “Knowledge Commons for Sustainability”. We recognize that every part contributes to the whole and no part can operate without the whole. The surprising result of the research is how reliably any share of GDP is likely to be “average” and pay for about the same share of world GDP impacts (4). 1) It first comes from how widely distributed consumption spending is, then 2) how widely money from any expense is distributed in the global economy, to all income levels within all kinds of businesses, as it is passed down a supply chain(5a,b). It then also relies 3) on how truly global and competitive economic markets and services are, with all parts being disciplined by the same competitive standards for profiting from the resources everyone has access to. So the baseline assumption that shares of GDP pay for the same average share of GDP impacts is both necessary as a default choice and likely to be accurate. Making decisions on how individuals and the world can depart from average would then become the focus.
Everyone could then understand their own benefits from the economy and how they compare with the global impacts of delivering them, seeing the simple facts in a broad context. For example, a 6 oz (180 cc) glass of wine for $10 seems like a small impact. As an average share of GDP what we find is $10 is quite likely to have an “average climate impact” of .45kgCO2/$ = 4.5kg for $10 = ~10lb x 16oz = 160 ozCO2 [2006 data] (4). So the weight of CO2 consumed would be ~27 times the weight of wine. The catch is that spending $10 on anything else would be the same. How we use any part of our incomes would be close to having an average share of CO2 AND other global impacts of the economy as a whole, soil loss, deforestation, environmental and cultural disruptions etc. [for 2016 data due to inflation and efficiencies impacts per $ are ~66%]
So the World SDG accounting model lets you:
Compare our shares of World GDP benefits with our shares of its measurable Ecological Societal and Governance (ESG) impacts.
Using “shares of the whole” as a common unit of measure for responsibility for the whole
by aggregating reliable measures of human impacts and risks to our future, including direct financial liability if there are good estimates
using the sound initial baseline assumption of “average responsibility per share” pending more complete accounting.
It would provide an accurate accounting for the modern world’s survival on earth. [ed 8/23/16]
… a scientifically combined balance sheet for financial and ESG factors, so people can better understand our economic choices.
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A World SDG
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!
Parallel growth rates for world GDP, Energy, CO2 and Efficiency => make average shares of GDP responsible for the same share of those parallel impacts.
“Sustainable Cities” is the topic to being the upcoming Open Working Group 7 on SDG’s, Jan 6-10 2014, in the UN’s marathon effort to decide “what we should do with the earth”. Our cities, as brilliant as places of creativity as they are, find themselves “in a fishy stream…” See also the final World SDG proposal on the global application of the general principle, that we all are responsible for our shares of the abuses of the economy as a whole … in proportion to our owning, investing in and using it.
The World SDG uses a method of calculation for any person’s or business’s share of world GDP, for estimating their total share of responsibility for world economic impacts as “users” called “Scope-4 Accounting“. The legal view of responsibility is different from “cause and effect” in that, legally, both the people paying for, benefiting from or authorizing a tort harm may all be held as equally responsible as the person actually doing the harm, as familiar for hiring others to commit a crime.
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Fishing in a fishy stream…
“Sustainable Cities” started with Caring for our Cities as Commons Neglecting The upstream burden of their wealth and the World as Their Greater Commons
Statement:
A scientifically better way to measure the true scale of economic footprints is as fractions of the whole. It’s easy and accurate for scale, treating fractions of world GDP as shares of world resource use and impacts too(1). Cities thrive as hubs of creativity and growing concentrations of wealth, cells within a greater whole. Without self-restraint, growing parts can become cancers on the whole, profiting by conquering others, not by caring for their world. A city’s limit is then exhausting their world, as done by ancient Rome, the Mayans and others.
New York City with ~1/10th of one percent of the world’s population has a $1,350 billion/yr GDP, ~2% share of world GDP, so causing ~2% of world economic resource demands and impacts, with its plan for real repeated doubling of all three. Wealth earned on New York’s 13 sq mi uses the products of ~380,000 mi2 of farm land around the world, ~2% of the world’s, with resource pressure causing ~2% of the world’s 1,460 mi2 of deforestation. Its services produce~2% of the world’s CO2, ~141,750 million lbs/yr, ~170,000 lbs. per NYC resident.
The question is, what would make New York and other cities turn from consuming to caring for the world they generate their wealth from(2)? Now each World Capital, as islands of high GDP, is growing its impacts on the world by growing amounts each year, as if as innocently as living by a lazy stream grabbing floating bags of money going by now and then.. Jessie Henshaw
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Jessie is an environmental and human systems scientist quite familiar with defining units of measure. She’s been doing advanced research on emergent organization in nature and economic systems for over 30 years. The scientific basis for this measurement method is a peer reviewed research paper
I write lots of very carefully crafted letters to people deeply engaged in the UN’s work on
Steering the Earth Toward Sustainability
…, its Open Working Group is drafting Sustainable Development Goals (SDG’s). Each letter is crafted to convey to leading thinkers some piece of my sophisticated natural systems view, of how to recognize the organized working parts of our economic environment and how they are changing. To steer the ship to calmer seas we need new kinds of responses to calm the waters, as our “stimulus” has been producing new hazards everywhere we look. Attempting to force the economies to grow while pressing ever harder on the planetary boundaries, has been driving it into ever more desperate quandaries of what to do instead.
Here are two letters from this week. I’d really like to know if you understand, or if you have any questions about the subjects raised, or how I arrive at my conclusions or choose how to present them. It could help me do this work a lot. JLH
The Need to redefine our Units for Measure and how to begin
Getting the incentives right:
To be effective in getting the results we want, we need to get the incentives right, a matter of understanding both how people make decisions and how the economic system works and would respond. That involves knowing how to measure what decision makers want to know about. For investment decisions, for changing how we use the earth one thing they’d want to know is their possible future liabilities for making the wrong decisions. That illusive goal is now much closer to being solved, with this major improvement in the measure of the impacts of businesses. The traditional way to measure impacts was to count up what you could trace, and this study showed that what we can trace is most often only a small part, basically because what was being left out was the impacts on the environment caused by the resource demands resulting from the revenue businesses generate as their main purpose, having to date only been counting the impacts of intended operations. This discusses a comprehensive approach to quantifying them. JLH
Statement to OWG 6:
Prepared statement For 9:00 AM Major Group Meeting of 12/12/13 on Means of implementation (science and technology, knowledge-sharing and capacity building) — “The mismatch between measured impacts and responsibilities”. Also delivered from the floor at OWG-6.1 the Informal Meeting on Measuring Progress” on Tuesday 12/17/13
Statement: Because sustainability metrics for businesses are just for the impacts of business operating technology, the environmental impacts of the people who operate the business, their employees and those of all the kinds of service providers businesses use to operate, don’t get counted. Businesses and economists, thinking of money systems not environmental ones, may not see a reason to treat businesses as physical systems and count all their impacts, but you know for sure nature does. So it’s very common for businesses and consumers to actually be directly responsible for much larger scale environmental impacts than they are told. Of course the reason we’re measuring impact is for steering a redesign of our economy for the future of the earth, and it would actually be better to get it right. Using metrics very often in error by 80% or more is really unacceptable as it voids the purpose of measurement in general, but you talk to people and they don’t want to change, sometimes mentioning the inconvenience. Don’t you think we’d do better to think of the “inconvenience” to the investors who have been trusting us, who we are presently giving false guidance to for what to invest in?Continue reading Getting the incentives right requires redefining the units of measure→
This is a serious effort to describe in natural language a well thought out way for a market economy to follow organic systems principles, and decouple from conquering the earth to reorient its development toward finding its secure place on earth. It would be driven by our goal seeking social and economic communities developing new markets and partnerships for mutual benefit as markets always serve to steer the economy, but having much better information on what’s profitable, and recognizing the true cost of inaction. As we find how to do it the economy would also change from building itself up internally to making itself at home externally.
By redirecting our resources from pressing ever harder on the limits of the earth, and instead aim for relieving the strain on ourselves and the earth, the economy would become relatively more profitable than before as it heals. A great many of the key goals of sustainability (SDG’s) being stated again and again at the UN, would be achieved naturally this way. Other critical goals would still take concerted planning and government action, but would become more practical to accomplish.
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Incentives to Sustainably Lower Our Global Footprint
Holistic and accurate measures of ESG costs of production and consumption
An Information System Everyone can understand, for a Self-managing World
Turning the economic pursuit from “conquest” to “homemaking”
“Nature’s Capitalism”, first profiting from building things, then by caring for them
Steering Capitalism with a purpose: giving us a good home on Earth
A. The idea
The natural way economies determine their futures is by “market choices”, as financial, business and consumer markets look for how to get what they want from each other and the earth. Then governments, the press, professions and open societies watch out for the common interest. That’s what designs of the economy of our future, telling developers what new parts to add or old ones replace.
Those market choices often don’t reflect common interests just for our natural lack of information. What was done around the world to deliver goods or services is not collected and passed along as they are paid for, What’s becoming possible is like that, ways to identify future societal costs that business may be held responsible for in the future, practices like adding to global inequities or harming our economic future.
Comparing comprehensive sustainability balance sheets, for finding development proposals with financially and culturally acceptable risks and benefits. Global benefits/People centered, Homemaking
Just one new fact about money can release a great wealth of information on that. It’s that the “hidden consequences” of using money we don’t immediately see have been scientifically shown to most often be close to “average”[1]. In information terms, that serves to “internalize all externalities”, opening the door to what has eluded us, a way to make sound decisions for the world as a whole.
It would let us build an information system making the choices responsible for impacts transparent for all to see. For example, spending one dollar generally adds about 1 pound of CO2 to the atmosphere. We might select the least cost engineering option for ending our addition of CO2 to the atmosphere as a standard measure, possibly bio-char, estimated to cost $.20 per pound of CO2. That would be equal to an impressive “tax” on GDP, of $.20/$1, an indicator of how poorly the earth’s profits are being used.
People would then clearly see, for example, that as we build more and more for the future economy to take care of, a natural turning point approaches for investors and everyone else, of diminishing total returns. So as growth becomes seen as a drain on future profits, the most profitable use of profits becomes caring for the environments creating the profits, not compounding our demands on them.
[1]Henshaw, J. 2011 Systems Energy Assessment. Sustainability MDPI. http://synapse9.com/SEA – People are “end users” of the consumption economy AND “end servers” of the production economy. The “end producers” for any dollar of goods or services are SO wide spread one must first assume, every dollar is distributed as an average share of GDP and reflects the average impacts of the whole, good and bad.
Last week was unusually successful for me at the UN, or felt that way. The increasing openness of the process, and my good luck in finding socially acceptable ways to stay it, both helped me. So I was able to bring small flashes of light to the deeper kinds of issues about “What to Do with the Earth” that the UN is continuing to expand it’s discussion of,..
toward defining the world’s “Sustainable Development Goals”
It’s really an amazingly broad discussion of every aspect of how the “world we want” should work, a truly impressive effort, well, of course still leaving out the things that we are culturally blind to and at the same time feverishly looking for to save our necks in a terrible situation Here are three of my statements for OWG-5, and capsule assessment of the UN’s Technical Support Team briefs for OWG-6 for framing everyones terms of discussion for the issues.
Yes, but can we REALLY now have energy and equity for all?
Macroeconomics – of ever increasing inequity
More Energy – for ever growing demand
Mismatched measure – impacts missing from responsibilities
Promoting growth at the limits creates severe increasing, not decreasing, inequities
The great variety of urgent SDG’s being discussed are truly desirable, but can only be somehow addresses together.
Monday morning Bernbadette Fischler offered a model that seems consistent with cost estimates for doing all this, that the SDG’s might for a period cost 2% of the income of the over developed economies to kick start the growth of the underdeveloped economies.
Say that worked. We’d then have 100% of world population using modern technology, adding their earnings to their investments to drive more growth, and so ever increasing competition over the earth’s shrinking resources too, adding even more strain on both people and planetary boundaries. Continue reading UN OWG-5 statements – SDG’s missing some signals→
This post is for the UN’s OWG 5 proceedings next week, on Post2015 Macro Economic development positions. It led to the OWG 8 proposal “A World SDG“, introducing an integrated true scientific measure of sustainability... It’s now followed with “The Decoupling Puzzle – a partial answer” , on measuring our “decoupling rate”, and the development space reserved within planetary boundaries, such as for achieving world cultural wellbeing!
Sadly, as careful as I am with the language, there is some scientific thinking… so the social organizations generally found no way to engage in discussing it. The basic principle is that “when you build something you then need to take care of it”… something everyone knows in their personal lives. That runs into the problem that, culturally, we don’t see economic growth as “building something”. We see it culturally as a “constant” of prosperity… the ultimate tragedy of our times. that ever faster change is seen as “constant” it seems. 4/21/14 jlh
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As a young systems scientist many years ago
I noticed a need for a better type of economic model,
that would connect money to its “externalities” in part. More importantly it would let people see economies as the complex living organisms they really are. What I found was the universal stages of natural development, that are repeated in the way any natural event or system develops from small beginnings to multiply at first, and then by multiplying in it’s environment changes it, an Organizational Stages Model (OSM)
Economies are chock full of independently organized and behaving social and cultural communities behaving like organisms, that each develops from a seed of organization in an environment of resources. You can talk about “why” things occur, causes at a distance or coincidences but that’s an intellectual issue, a prediction, a theory.
This is about using the most general of pattern of “how” individual events occur the processes of developmental causation taking place in nature in every location where events occur.
Economies, for example, are all populated by actively creative and learning people, discovering things and following each other’s leads…. So what this “Organizational Stages Model” (OSM) approach focuses on for economies is how people learn and how what they learn to do spreads as transformational stages of growth and the emergence of new systems, and their natural limits. The simple rule, for the transformative stages of any process of new emerging organization, then, is that it’s organizational process will follow an “S” curve. The first half is of multiplying innovation and expansion of connections, a “burst of development”, and the second a process of rebalancing and integrating.
Organizational Stages Model
That’s the dynamic we need to capture in our minds to understand the world we live in. An economy is really a whole “civilization” in fact, organized like an ecosystem, accumulating and passing on its knowledge of “how to live” in the form of family and social cultures, as the living “genetic code” of the societies they create. THAT is what the word “growth” refers to, the compound rates of expansion of that whole organic living culture.
As systems of nature, all those living parts and the whole, first grow and then mature to live and later decline
by very much the same succession of life’s great transformative experiences.
The ultimate most useful model for it I found is really cool! It’s organized as “a Narrative of Life” as a great chain of instrumental transformations. I’ve been looking for a name for my life’s work on it.. perhaps “Life Narrative Studies” (LNS) would do. I won’t further introduce it here, as it’s what my whole site is about, but just present this new graphic to help readers get a feel for the general pattern.
This post was for the UN’sOWG 5 meetings on Sustainable Development Goals (SDG’s) from 11/23 to 11/27, submitted as an NGO contribution toPost2015 energy development positions. The issue here is that there’s a big mismatch between local and global measures for current accounting methods used to estimate the energy uses businesses are responsible for. It’s an accounting discrepancy commonly on the order of five or tenfold, i.e. so large and undefined that local measures become not scientifically comparable. It comes from the way the local measures are defined not including a way to account for the energy uses incurred as businesses pay for the services they use to operate. The global accounting includes them by being the total of all economic energy uses combined.
They have “consumption for production” just like technology, but just not yet being counted!
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The global data is very clear, increasing GDP always requires proportionally related increases in energy use. Our local sustainable business plans for all sorts of projects seem to suggest the reverse, though, increasing revenue (fractions of GDP) with decreasing energy use!
What’s up?? Our math and the world’s seem to disagree! Could some projects be outsourcing energy services and not knowing it??
The world economy grows as a whole
There are two possibilities. Either there are hidden energy uses that our SD proposals are a)not responsible for, or that they b) are responsible for. It’s hard to chase down puzzling discrepancies like this, but this one had an answer, published in Sustainability (MDPI) in 2011, as Systems Energy Assessment (SEA).
What seems to be happening, all over the world, is the amount of **untraceable energy use** is growing… and so making SD figures unreliable and overly optimistic.
J.L. Henshaw @shoudaknown
