image missing Date: 2021-12-07 Page is: DBtxt003.php L07-01-PERSPECTIVES


PERSPECTIVES
within the SOCIO-ENVIRO-ECONOMIC SYSTEM
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THE CHALLENGES OF OPTIMIZING FOR MULTIPLE PERSPECTIVES
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There are many different truths from a single activity. It depends on your point of view:
  • that of the individual person or household;
  • the community;
  • a place;
  • a small local business;
  • a large multi-community business;
  • a product and all the steps in the life cycle of the product:
    • its supply chain;
    • production;
    • use; and
    • post use waste chain.
Every item or entity in the socio-enviro-economic system needs to be 'numbered' in a way that reflects the impact the entity has accumulated to data and will accumulate in the future.
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BIG BUSINESS ... economically efficient
Profit ... Profit performance and value for stockholders has been the main big business objective for a long time. Optimizing for this one perspective has been very effective.
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LOCAL BUSINESS ... socially valuable
More than profit ... Local business may be economically inefficient, but it has a valuable social function and helps a community socialize.
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PEOPLE ... the only reason for economic activity
Men, women & children ... People must have some essentials to live, but quality of life is much more than this. Happiness is more than just wealth!
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PLACE ... a good place to live
Where people live ... Local retail business may be economically inefficient, but it has a valuable social function and helps a community socialize. Life is better in a community setting.
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PLACE ... where economic activity locates
Where people work ... economic value add in the place serves to support the social activities of the place and quality of life. Location of industry has always been about the characteristics of the place.
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PRODUCTS
Quality of Life is determined to a considerable extent by consumption ... Local business may be economically inefficient, but it has a valuable social function and helps a community socialize.
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CONSIDER ALL THE PERSPECTIVES
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ACTIVITIES HAVE IMPACT ON ALL CAPITALS
SOCIAL CAPITAL

Quality of Life
NATURAL CAPITAL
Essential enabler
ECONOMIC CAPITAL

Wealth / GDP
In classical economics there was the idea of 'Factors of Production' ... that is Capital, Land and Labor, where capital was money. Though not part of modern economic conversation, these ideas need to be part of modern thinking and policy formulation. Well before the industrial revolution, Adam Smith wrote not only The Wealth of Nations (full title 'An Inquiry into the Nature and Causes of the Wealth of Nations (1776) but before that a less well-known book titled 'The Theory of Moral Sentiments (1759)' both of which inform not only the thinking that is embedded in economics but is the basis for TVM.
In TVM the idea of three 'Factors of Production' is reborn as three dimensions of capital; that is a Social dimension, an Environmental dimension and an Economic dimension. For TVM progress is positive when the aggregate of these three dimensions or capitals or state is positive ... something that has been rare in recent decades. Rather, the incentives have been for economic performance to be optimised at the expense of society and the environment with the owners of the economy consolidating wealth and power with everyone else losing out.
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OTHER FACTORS ARE ALSO IMPORTANT
PLACE

Where people live
PROCESS

How things are made
PRODUCTS

What gets made
Some people are very fortunate, and others less so. The accident of birth should not be the main determinant of success and a happy productive life. There should be opportunity for everyone. The characteristics of the place make a big difference to quality of life. The choices people make regarding the products purchased and consumed impact the person, the economy and the environment.
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TECHNOLOGY IS CHANGING OUTCOMES
PASSENGER TRANSPORTATION
HORSE-POWER
STEAM-TRAINS
AUTOMOBILES
HI-SPEED TRAINS
AIR TRAVEL
Consumption is driving the modern economy. It looks like success as long as the depletion of natural resourcs and the degradation of the environment is ignored.There is strong correlation between better quality of life and more consumption in poor economies, but less so in mature rich econmies. Rich economies are increasingly associated with waste, luxury and inefficiency.
CARGO TRANSPORTATION / LOGISTICS / SUPPLY CHAIN
FREIGHT TRUCK
FREIGHT TRAIN
CONTAINER SHIP
AIR CARGO
PACKAGE EXPRESS
Consumption is driving the modern economy. It looks like success as long as the depletion of natural resourcs and the degradation of the environment is ignored.There is strong correlation between better quality of life and more consumption in poor economies, but less so in mature rich econmies. Rich economies are increasingly associated with waste, luxury and inefficiency.
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BASIC NEEDS CONSUMPTION IS ESSENTIAL
FOOD
WATER
SHELTER
SECURITY
HEALTH
Consumption is driving the modern economy. ??????
MORE CONSUMPTION GIVES BETTER QUALITY OF LIFE
CONSUMPTION
PROCESSES
MATERIALS
ENERGY
PAYROLL
Consumption is driving the modern economy. ???????????
CONSUMPTION BY ULTRA RICH HAS BAD IMPACTS
CONSUMPTION
AIR TRAVEL
YACHTS
HUGE MANSIONS
TAX HAVENS
Consumption is driving the modern economy. ???????????
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ACTIVITIES OF CORPORATE ORGANIZATIONS
ALL HAVE SUBSTANTIAL IMPACT ON SOCIETY AND THE ENVIRONMENT
DIGITAL TECH
Google
OIL & GAS
ExxonMobil
AERO ENGINES
Rolls Royce
BANKING
HSBC
ENGINEERING GE FOOD Unilever
Most of the global economy comprises products that are produced by very big organizations that are complex with multiple factories in many different locations, and supply chains that span the globe. It is not easy to understand these companies in a way that makes it possible to hold them accountable for their behavior. Nevertheless, despite their complexity, they are able to communicate their profit performance to investors, but not their social impact nor their environmental impact, even where these are material. This has to change.
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PROCESSES & FACTORIES
THESE HAVE IMPACT ON SOCIETY AND THE ENVIRONMENT?
MINING
LOGISTICS ENERGY
ELECTRICITY PRODUCTION
OIL REFINERY
Every sector, every industry, has become very specialized and over a long period of time has been optimized for profit performance. Profit performance has been exceptional for decades, but too little attention has been paid to social and environmental issues. This must change. Process improvements are essential and must focus in improving social impact and environmental impact as well as merely being more profitable.
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SECTORS / INDUSTRIES
WHAT IS THE IMPACT ON SOCIETY AND THE ENVIRONMENT?
MINING
LOGISTICS ENERGY
FOOD - Vegetables HOUSING HEALTH
AG-GRAIN
PRODUCTION
REFINERIES
FOOD - Meat EDUCATION HEALTH
AG-LIVESTOCK RAIL ELECTRICITY CLOTHES MOBILITY HEALTHCARE
Every sector, every industry, has become very specialized and over a long period of time has been optimized for profit performance. Profit performance has been exceptional for decades, but too little attention has been paid to social and environmental issues. This must change. Process improvements are essential and must focus in improving social impact and environmental impact as well as merely being more profitable.
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STREAMS / STRANDS / STRINGS
WHAT ARE ALL THE IMPACTS FOR THE LIFE CYCLE OF PRODUCTS?
NATURE EXTRACTION
SUPPLY CHAIN PRODUCTION
USE
WASTE
Everything that is used to support a high standard of living and quality of life has a long supply chain, then production and distribution, then use, and then a post use waste chain. For metrics to be meaningful, all of these stages must be brought into account.
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PEOPLE ... THE ULTIMATE ACTORS
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PEOPLE MAKE DECISIONS ABOUT THE CONSUMPTION OF PRODUCTS
Food - Vegetables Food - Meat Housing Clothes Mobility Recreation
More consumption correlates to a better quality of life up to a certain level. Beyond that level more consumption may well have negative consequences, as for example too much food may result in obesity and diabetes or worse.
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PEOPLE AS CONTRIBUTORS ... AS DECISION MAKERS
AS INDIVIDUALS

Live life ... work & family
IN ORGANIZATIONS

Do the work ... make the decisions
AS INVESTORS

Allocate financial resources
EMPOWER THE INDIVIDUAL AND ENABLE BASIS FOR A BETTER LIFE
Every individual is different, both in what they are capable of doing and how they want to live their lives. People should have the freedom to succeed in all sorts of good ways, and should be helped so that they never fail. People need the facts about themselves and everything around them.
ESTABLISH ACCOUNTABILITY FOR PEOPLE WITHIN ORGANIZATIONS
Companies are important drivers of the economy. Within companies it is people that make the decisions, and for many decades the dominant metric for success has been profit without taking into consideration impact on society and nature. This must change. Profit performance on its own is not enough!
IMPROVE DECISION PROCESS FOR INVESTMENT DECISIONS
The allocation of capital shapes the future of the economy. People make the decisions about what investments should be made and have been guided mainly by the potential for growth of financial wealth without taking into consideration issues relating to society and the environment. These other issues matter.
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PLACE
THE CRITICAL VALUE ADD FROM LOCATIONAL CAPITAL
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CITIES / COMMUNITIES
Cities and Communities are where people live their lives
MAIN ST.
SCHOOLS CHURCHES POLICE RECREATION HOSPITALS
SUBURB
UNIVERSITIES HOUSING FIRE RELAXATION PERSONNEL
Everything is needed in the place to enable Quality of Life. Everything is interconnected. Nothing important can be missing ... multi-sector is essential
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COUNTRIES
More than 200 countries ... with vastly different characteristics
China France Russia UK USA India Brasil RSA Indonesia Pakistan Nigeria
Data at the country level is useful for broad comparisons, not so much for timely management of socio-enviro-economic performance.
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PRODUCTS
PRODUCTS IMPACT PEOPLE AND ORGANIZATIONS AND NATURE
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NEEDED FOR A DECENT QUALITY OF LIFE
Food - Vegetables Food - Meat Housing Clothes Mobility Recreation
More consumption correlates to a better quality of life up to a certain level. Beyond that level more consumption may well have negative consequences, as for example too much food may result in obesity and diabetes or worse.
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PRODUCTS START WITH NATURE AND HAVE A LONG LIFE CYCLE
NATURE SEA
STEEL
EATING
WASTE RECYCLING
NATURE ROAD
REFINING
CONSUMING
LANDFILL RECYCLING
EXTRACTION
RAIL
POLLUTION
DRIVING
FLOODS
NO WASTE
Products enable consumption that improves quality of life. The production of products is a critical economic activity and source of profit for companies. Production and products are only sustainable if they do not degrade the environment. Most modern industrial process are catastrophically unsustainable. Smarter processes are needed together with smarter products, smarter consumers and systems to enable a circular economic model.
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