I came across a few cool projects today that made me wonder when we’ll have a currency for sustainability. I’ve written a bunch about how our conceptualization of “money” and “currency” is being expanded as we find new ways to measure and make transparent aspects of wealth that were previously hidden. For example, services like PeerIndex and Klout seek to measure influence, authority, trust, and how well your message resonates with an audience, hence establishing online reputation currencies.I’ve also read before about the weakness of GDP in determining the actual health or wealth of a nation, as it misses out on major indicators of human and environmental well-being – which are arguably more important than the measurement of consumption. Other systems have been proposed, like the Genuine progress indicator (GPI), which attempts to measure whether a country’s growth have actually resulted in the improvement in the well-being of the country’s people.Another fun one is Gross National Happiness (GNH), which attempts to measure quality of life or social progress in a more holistic way, focusing on sustainable development, preservation and promotion of cultural values, conservation of the natural environment, and establishment of good governance. This idea was further fleshed out a few years ago as follows (from Wikipedia):
- Economic Wellness: Indicated via direct survey and statistical measurement of economic metrics such as consumer debt, average income to consumer price index ratio and income distribution
- Environmental Wellness: Indicated via direct survey and statistical measurement of environmental metrics such as pollution, noise and traffic
- Physical Wellness: Indicated via statistical measurement of physical health metrics such as severe illnesses
- Mental Wellness: Indicated via direct survey and statistical measurement of mental health metrics such as usage of antidepressants and rise or decline of psychotherapy patients
- Workplace Wellness: Indicated via direct survey and statistical measurement of labor metrics such as jobless claims, job change, workplace complaints and lawsuits
- Social Wellness: Indicated via direct survey and statistical measurement of social metrics such as discrimination, safety, divorce rates, complaints of domestic conflicts and family lawsuits, public lawsuits, crime rates
- Political Wellness: Indicated via direct survey and statistical measurement of political metrics such as the quality of local democracy, individual freedom, and foreign conflicts.
51 Great Sites for Corporate Social Responsibility and Sustainability
Peter Sims said:
Another open source initiative (energy calculator) that showed some promise was Wattzon:
Here’s a challenging view from a World Bank environmental economist on the planet’s intangible wealth —
It shows the vital role of social institutions in creating well-being.
Perhaps a new accounting system could calculate, using some of Kirk Hamilton’s key insights, the “shadow price” (opportunity cost) of institutional failures?
An era with a Cambrian explosion of experiments in governance (along the lines proposed by Patri Friedman and Peter Thiel) could accelerate the discovery of new ways for market prices to internalize social costs.
My own hunch is that land values over time generate feedback — and a measurable hedonic index — on the success or failure of institutional experiments relating to accurate internalization of social costs and pricing of public and private goods.
Jean Russell said:
Splendid Venessa. Currency aka metrics for sustainability have been a challenge since the movement began in the 70s. The effort toward For -Benefit companies has resulted in http://www.giirs.org/ which you might want to take a look at. It is based in http://iris.thegiin.org/. The investment community has been highly motivated to develop and now standardize metrics. While there were some SRI tools 15 years ago, people like Paul Hawken were furious about their lack of integrity. You can track someone like @KevinDoyleJones to see how social enterprise is developing and expanding metrics. It was a hot topic at SOCAP this year. SOCAPEurope is coming in May if you want to check it out in Amsterdam. Keep in mind the effort in that sector is more on the spread of environment, social justice, worker rights, community development, etc… they are not just talking environmentalism (in fact it tends to be a lesser factor than social justice).
For environmental metrics, I look to people like @gfriend of Natural Logic (.com) for direction. I would like to see metrics developed to track industrial ecology, so we can encourage companies to sell their waste to other companies that make things with it.
I like how you incorporate sentiment analysis! Very nice.
Also, just to be a bit nit picky, sustainability isn’t a currency, really… we can create and use currency to measure sustainability or CSR. And specifically here, we are talking about aggregate currencies – where there are numerous measures, and we want to pool them together to get one indicator.
There is A LOT out there. And a great many people working on these issues.
Fabio Barone said:
In the area of social progress metrics, this could be quite interesting:
Oh yess, agree with you, and Jean Russell, too. Also a nit to pick, the white t-shirt does not go well with heavy metal from dyes 😉
From humble beginnings decades ago, then called LCA (Life Cycle Analysis), to more recently, triple bottom line, and many other names, a movement is growing. With each personal awakening it gains traction. The land contaminated for decades near Fukushima is another symbol of the capital failure of a business model.
We realize that privatizing profits and socializing cost is not sustainable. We vote by wallet and stop buying from such companies. We may even call for boycott. Well, tough in case of an electric utility like TEPCO, which is likely to get “broke to pieces”. I hope on the now unarable fields they put solar, wind farms, and geothermal power plants. and pay the people of displaced villages and cities a dividend – on top of the compensation for being forcefully evicted by lethal levels of radiation and suddenly dispossessed of their land.
There is Adbuster’s video ad about Gross Domestic Product – GDP
And Corporation 20/20, Designing for Social Purpose.
Happy to note, for reasons of personal involvement that the UN Global Compact is among the 17 I recognize of the 51 Great Sites for Corporate Social Responsibility and Sustainability.
To end a widely accepted form of hopefully benign tyranny, employee engagement and workplace democracy play a major role
Maybe what we see growing here is what Seth Godin encourages us to take in his TED talk (4 minutes cut out): Initiative. Start a movement.
This stuff is pretty new to me, and I’ve forwarded the link to a student here in Chicago studying CSR at the Harris School of Public Policy as well as a colleague working who is developing a social initiatives program for a pretty big company in Chicago. Thanks so much for this “food for thought.”
Venessa Miemis said:
great, hope it’s useful
I love the idea of GPI, and I see that we here in Canada are supposedly supporting the idea in some way. I’ll be following that as it develops, thanks.
I’m convinced the vision for earthdash.org is good, PLS keep us in the loop. I’d love to experiment with an installation like that!
Random inspiration: I’ve been chatting a bit with the earthship.org people (Earthship Biotecture), and I’ve been trying to learn more about web monitoring and social analytics, so I can go down there and help them maximize the growth of their networks and communications initiatives. I’d love to also be able to present them with some inside dirt on the earthdashboard. I’m just putting that out there, just for the heck of it. If you want an alpha/beta tester, I’m very much interested in becoming involved.
Venessa Miemis said:
hey, i tried to check out earthship.org but the site was down for maintenance. will check back.
They have a ton of videos on their youtube channel:
I really love the Haiti ones. They’ve done some good work.
I feel like the website being down is a sign that I have to head down there sooner than later to help out. But I guess they’re getting some pretty good exposure on facebook http://www.facebook.com/earthship.
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Philippe Verstichel said:
A bit light though nice debut to start talking about the metrics required to assess sustainability. @jdevoo has developped a very interesting mindmap about this measurement issue. It is based on the classic state-pressure-response model advocated by the OECD.
All along up to the end of your post, it is a matter of cost, even what you call ‘true’ cost. Each time one uses the word ‘true’ or ‘truth’, one enters a philosophical realm that is in my humble opinion not deemed to be measured. You can potentially evaluate the consequences or the impacts of products or services on sustainability. That means you’d need to take into account the context or the environment, hence the impossibility to call it ‘true’ cost.
Moreover, as suggested by others, why would we need to rely on an ‘accounting’ framework? That’s fine for product or service economy, may be not appropriate for relationship-based economy.
As for the ‘labelling’, it is a better approach for it gives individual real freedom of choice (or decision) based on compelling information (no need for abstract numbers). I see the points raised by Mark and Bernd being very relevant because they are very human-oriented. Also, there something that people do not understand about sustainability : there is no room for such thing as ‘trade-off’ or ‘compromise’. It’s not a land of pink & grey, rather a checkerboard of black and white. Saying that you are 75% sustainable and 42% socially responsible is a joke.
Good luck with UNO,
Venessa Miemis said:
“@jdevoo has developped a very interesting mindmap about this measurement issue.”
cool, do you have a link to that?
“All along up to the end of your post, it is a matter of cost, even what you call ‘true’ cost. Each time one uses the word ‘true’ or ‘truth’, one enters a philosophical realm that is in my humble opinion not deemed to be measured.”
right. i didn’t make up the term “true cost” accounting (TCA), it was mentioned by others and is apparently synonymous with “full cost accounting” (FCA). the wikipedia article also points out the trouble with calling anything “true.”
the page on green economics is also good, and breaks down what green/sustainable means into six main sectors: renewable energy, green buildings, clean transportation, water management, waste management and land management. all those things seem to to be pretty straightforward for determining metrics, whether you’re in a “relationship-based economy” or not.
“Saying that you are 75% sustainable and 42% socially responsible is a joke.”
i don’t know if i agree with that. i think there can be a range of practices an organization implements within their business processess, some sustainable and some not.
I love the earth dashboard, exactly what ‘we’ need – do you know how long before it is launched as a public access service?
I think a sustainable currency is actually simpler. In the same way that limiting the amount of money you give your kids can force them to evaluate the real cost and benefit of all their purchases, limiting currency production to a tangible asset like gold can also force fiscal responsibility. In this case, the limiting factor is the earth.
Some have been arguing the case that instead of gold (which seems to have be an industrial asset), pure water could also be a currency.
Just some thoughts….
Venessa Miemis said:
some say the next war will be over water –
and we’re on pace for massive global water shortages by 2050 –
so yeah, i agree. water WILL become a currency.
Just got my toes wet on Empire Avenue. It combines a social currency based on measuring activity with buying/selling shares in people or in brands, like a token of trust. You can try it out here (invite link) http://empireavenue.com/?t=xmjrmqdq
For now it is single bottom line, virtual currency game. I guess it would be easy for users to bring in aspects of Sustainability & Corporate Social Responsibility, e.g. by their choices, comments and shout-outs (like tweets in more than 140).
Could that become a next digital tapeworm? #futureofmoney
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Alex Goldman said:
In my opinion, the reason why CSR and quantifying the social impact of a good has not taken seed, is because our marketing system is engineered to encourage the purchasing of products out-of-context.
And because marketing and consumption have been ‘out-of-context’ activities for so long, any attempt to ingrain a marketed product with information about its social impact must first address our mentality as consumers; ‘consumption’, is, by definition, a mindless act.
The question is not “what is the best way to measure social impact” but “how do we use the tools at our disposal to shift away from a model of consumption.”
So what else is there besides consumption? I think the opposite of consumption is interaction. Even if I know that a T shirt is produced using child labor, it doesn’t really mean anything to me. Just because you can quantify something, doesn’t make that number ‘matter’. Companies use this to their advantage; no amount of ‘bad publicity’ will help people be able to feel the pain of a child working in a sweat shop. And besides, if you don’t buy that T shirt, the factory will shut down, right?
The trick is to put faces on the names. A global network where we KNOW and are friends with people across the world, and can witness PERSONALLY how shifting employment and economic factors effect the lives of our friends, however distant, will be more powerful and influential than any number. Humans are, in fact, incredibly bad at measuring numbers, and incredibly good at loving people they know well.
Gregory Rader | OnTheSpiral.com said:
People tend to understate the importance of things that don’t impact them personally and which they cannot do anything to change.
People tend to overstate the importance of things that do impact them personally and which they can change.
Alex points out that we must feel personally impacted in order for whatever metrics to be relevant. The other piece is that we must feel we can positively influence that situation…otherwise we will block it out.
Rob Peters said:
I do not think I ever anticipated a “Facebook Economy”. I believe we need a Relationship Economy based on open and trusted standards that measure Relationship Capital (RC) across all social media and social networking sites. No matter how well Facebook performs when it comes to connecting people, brands, services, and organizations, it is still Facebook’s “garden”.
We require an industry standards body that defines the process of assessing, capturing, measuring, and utilizing Relationship Capital (RC) across all social media and social networking platforms.
If the private sector does not step in, Facebook will become so powerful that the government will step in and regulate. A U.S. Treasury-like or Federal Reserve Bank for Reputation & Influence agency regulating social currency.