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Date: 2024-04-25 Page is: DBtxt001.php txt00004539 |
Initiatives ... Metrics |
Burgess COMMENTARY I argue that the game is not played at the national level, within think tanks and political circles ... but is played mainly in corporate boardrooms and everywhere people make business decisions. In this arena, the terrible trio of (1) money profit (2) stock market prices and (3) GDP growth dominate decisions. The flaw with the ideas expressed in the following article about 'Competition 2.0' is that the focus is on metrics that sit at the top of the pyramid rather than being metrics that work best at the bottom of the pyramid (BOP). Yes ... these ideas can help with the policy framework at the national level ... but whether these ideas as anything like as powerful as the money from lobbyhists that are engaged in enabling progress according to the failed metrics of ... money profit ... stock prices ... GDP growth ... the terrible trio.
To be constructive TVM needs to have the same agenda as this Competition 2.0 but with a focus on decisions at the level of the economic activity, the organization and the community.
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Footprint Basics - Introduction You’ve probably heard of the Ecological Footprint - the metric that allows us to calculate human pressure on the planet and come up with facts, such as: If everyone lived the lifestyle of the average American we would need 5 planets. This section of our Web site explains how the Ecological Footprint works in basic terms. It examines the benefits of ecological accounting, introduces some of the most important Footprint findings, and addresses provocative questions: Do we fit on the planet? How can the Footprint foster sustainable human development? How do carbon emissions contribute to humanity’s Ecological Footprint? Competitiveness 2.0 By Mathis Wackernagel, President, Global Footprint Network and André Schneider, Chairman and CEO, Global Advisory SA
What is at Stake? We are entering a new era, one in which resource costs are rapidly becoming an ever more significant economic factor. Today, resource demand is so high that biocapacity — the services and resources that nature makes available — is being overexploited, not just locally but at the planetary scale. If these trends continue, resource constraints will become a leading factor determining economic success — or crisis — in the 21st century. Course corrections are still possible. But these physical resource trends are slow-shifting and hard to reverse. As with super-tankers, course corrections need to be taken early and decisively to avoid disaster. Recognizing these new dynamics offers opportunities. Proactively addressing resource constraints is in the direct self-interest of nations. Nations that adjust to this new reality and limit their resource dependence will accrue the benefits of new opportunities and risk reduction. Decision-makers must better recognize all the key economic drivers of success. Without reversing trends, the impacts of the growing resource gap might rise substantially, and become increasingly non-linear and volatile. Those who fail to act will lose their competitive advantage as potentially rapidly growing resource costs eat up more of a nation’s income. Resource constraints are global, but the risks and opportunities they create are largely local. For nations that want to succeed, we are proposing an updated competitiveness framework: Competitiveness 2.0. Where We Come From: Increased Global Integration Over recent decades, the world has become increasingly interconnected. Now, for companies to succeed, they have to stay ahead of their global competition, not just their local neighbors. World-class performance has been key to their success. Against this backdrop, the theory of 'competitive advantage' emerged. This theory, advanced by Harvard scholar Michael Porter in 1985, suggests that states should, as a focus of their national strategies, embrace productivity growth and adopt policies that allow their businesses to create high-quality goods to sell at high prices. This Competitiveness 1.0 approach is based on the assumption that the well-being of a country, measured by its GDP, would improve by creating the most beneficial national and global regulatory frameworks for business growth. Such an approach would increase revenues of companies and citizens' salaries, which in return would boost a government's tax income. A country’s competitive advantage, the theory holds, enables it to invest in its social structures and build its social capital. The acceptance of the competitive advantage framework as the engine for progress has had a profound impact on national strategies:
Economic success in past decades has translated into resource consumption levels that are no longer sustainable. As a result, nations’ efforts to drive their competitive advantage could be a race to disaster: As they maintain their income (or GDP levels), countries are liquidating their assets by running fiscal deficits or overusing biophysical resource stocks. This competitive framework ignores factors critical to a nation's future success:
The new resource context calls for an upgrade of the classical model of competitive advantage that addresses the rapidly shifting resource dynamics. Besides the main components of such resources (e.g. biocapacity, water, fossil energies, minerals), which are crucial to sustainable well-being, the next generation of competitiveness models should include the following elements:
The idea is simple: In a time of growing resource constraints, we need to update national competitiveness strategies. While the elements of traditional competitiveness still hold, it has become clear that one key factor, national debt, is starting to overshadow all others and needs far more attention. We call this realization Competitiveness 1.5. But the debt crisis is merely a symptom of a larger structural problem: The fact that resource dependencies and associated costs and disruptions are becoming one of the key drivers of economic success. In the past it was rational to ignore it, since it was a declining cost factor. But to operate today without aggressive resource policies could in time erode all progress achieved through the classical model. An updated model of competitiveness that is fit for the emerging future of global ecological overshoot must embrace the nexus of resources and sovereign debt as key factors for national progress. The model we propose, Competitiveness 2.0, can be presented as three key principles:
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The text being discussed is available at http://www.footprintnetwork.org/en/index.php/GFN/page/basics_introduction/ |
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