What Counts Can’t Be Counted

iStock_scales.jpgSustainability is a property of the whole planetary system. It should not be confused with the performance of discrete parts of the system, for example, single firms. That’s why I am careful to define sustainability as flourishing, an emergent property of the whole, complex system, including all forms of life, human and otherwise. And like all such properties, sustainability cannot be reduced to a single or even a set of metrics. To do so is to risk confusing progress in reducing the burden on the world with advances toward flourishing. Worse, better numbers gives the impression that we are doing just fine and can go back to the same habits that brought us unsustainability in the first place.

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Pot Pourri 11/23/2008


This is the second week for this feature. I will repeat the caveat from the first collection. Sustainability is not a single, tightly constrained idea. So this posting will include items about sustainability, per se; greening; complexity; culture change; and others. Please email me or leave a comment if you have other topics that you think should be included under the broad theme of sustainability. But remember I don’t write about sustainability in the same way as the mainstream media does.

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Sustainable Capitalism or Capitalism for Sustainability?

Today, following the momentous election of yesterday, the WSJ published an op-ed piece by Al Gore and David Blood, identified by their roles in their investment management firm, Generation Investment Management. The last few paragraphs carries the main message.

Sustainability and long-term value creation are closely linked. Business and markets cannot operate in isolation from society or the environment.

Today, the sustainability challenges the planet faces are extraordinary and completely unprecedented. Business and the capital markets are best positioned to address these issues. And there are clearly higher expectations for businesses, and more serious consequences for running afoul of the boundaries of corporate responsibility. We need to return to first principles. We need a more long-term and responsible form of capitalism. We must develop sustainable capitalism.

They are absolutely correct in pointing to the critical linkages between “businesses and markets and society and the environment.” But as long as we start from the fundamental concept of a world apart and separate from us, we are inexorably drawn towards a world-view that ignores the interconnectedness.

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Citizen Renaissance

I just “stumbled!” upon a remarkable website, offering an opportunity to contribute to a book entitled, Citizen Renaissance. The basic idea is that those who are now consumers will become citizens in the future. One of the co-authors, Robert Phillips, is the head of Edelmann, UK, a branch of the world’s largest independent PR firm. I found his short essay, The Rise and Fall of the C Word, compelling. Although his solution to the unsustainable consequences of consumerism is different from mine, it adds another path to follow in the quest toward sustainability.

Here are a few keys pieces from his essay.I encourage all the readers to read it in full. It’s language comes from the world of advertising and communication, but it’s message is clear to any concerned citizen.

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Detroit May Live After All


Don’t give up yet, GM and Ford. SUV’s may make a come back after all. Americans’ memories are very short and there is nothing like $2.00 gas to make them forget the pain of the last several months and let them return to their addictive habits. Boston Globe columnist Derrick Jackson points to a New York Times headline, “Drivers Take to the Road Again as Gas Prices Fall.”

But our addiction to automobiles, a huge source of greenhouse gases, is just part of the problem of unsustainability. As I write in Sustainability by Design, it is a much deeper addiction driven by cultural beliefs and values buried deep in our collective mindset that threatens the globe. Addiction cannot be overcome simply by taking away the drug, gasoline in this case. Unless something else is put in the place of the addictive substance, the old habits will come back sooner or later.

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Perception is Reality

Today, David Brooks, writing about the financial mess in the New York Times, says that our behavior may not follow the old rules about rationality.
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My sense is that this financial crisis is going to amount to a coming-out party for behavioral economists and others who are bringing sophisticated psychology to the realm of public policy. At least these folks have plausible explanations for why so many people could have been so gigantically wrong about the risks they were taking. . .

If you start thinking about our faulty perceptions, the first thing you realize is that markets are not perfectly efficient, people are not always good guardians of their own self-interest and there might be limited circumstances when government could usefully slant the decision-making architecture (see “Nudge” by Thaler and Cass Sunstein for proposals). But the second thing you realize is that government officials are probably going to be even worse perceivers of reality than private business types. Their information feedback mechanism is more limited, and, being deeply politicized, they’re even more likely to filter inconvenient facts.

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Wake-up Calls

The financial meltdown shows few signs of stopping right now. It is certainly a wake-up call to warn us of danger to our financial health. Because we depend on our money resources for almost our entire well-being these days, it has triggered a very painful and often depressing feeling. But like so many crises, it is an opportunity as well as a calamity.

The opportunity is not to focus on the outcome, although it is very hard not to read the tea leaves that we call the Dow. Somehow we take the Dow as the measure of our financial health. And thereby we fool ourselves into thinking that the free financial market is nothing more than a money machine, with emphasis on the word, machine. Driven by computers programmed to locate tiny chinks in the rational model of a market, and by the tool of risking other people’s money to multiply your own meager capital manyfold, it seemed like a foolproof system for those owning the computer’s while holding other people’s money.

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Greening the Curriculum?

iStock_000006160804XSmall.jpgIn the most recent edition of GreenBuzz, Joel Makower, the editor, takes universities to task for failing to match commitments to green the campus with equivalent moves to green the curriculum. I believe that it is much more than a lack of commitment at work here. I do not think that academics have a clear enough idea of what sustainability is all about to develop courses and syllabi on the subject.

Greening the campus is easy compared to the job of thinking through what should go into courses that incorporate aspects of sustainability. We can read of many efforts that point to LEED certified buildings, recycling programs, carbon use reduction, and more.

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When Math Misleads

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For complexity mavens, the current financial mess is a bonanza. If we set aside the painful crunch that is affecting so many, we might see that complexity is moving up in importance and acceptance. Complexity is a world view that argues that systems like the environment or the financial system are not describable or understandable by reductionist scientific methods. Sustainability is very closely related to such systems and their capability to provide health, security, beauty or, flourishing (the term I use in my book), far into the future under all sorts of changing conditions. The suddenness and huge scope of recent events has raised many question about the ability of conventional analysis to inform our key societal decisions.

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Keeping our Eyes on the Right Ball

While most of our attention has been focused on the financial turmoil and losses mounting in the trillions of dollars, the World Conservation Congress was meeting to discuss another, perhaps, more serious loss of capital–natural capital. In an interview with BBC, Pavan Suhkdev recounted the conclusion of a study of the annual attrition of global ecological resources. He said that losses of natural capital, just in deforestation, amount to about 7% of global GDP.

It’s not only greater but it’s also continuous, it’s been happening every year, year after year. . . So whereas Wall Street by various calculations has to date lost, within the financial sector, $1-$1.5 trillion, the reality is that at today’s rate we are losing natural capital at least between $2-$5 trillion every year.

The report was the first phase of a longer study, The Economics of Ecosystems and Biodiversity, sponsored by the German Government. The sponsors of the study hope that the results will have the same impact as the Stern Report on Climate Change, which many see as the turning point in getting that issue onto the agendas of global leaders.
A few posts ago, I referred to Herman Daly’s claim that the economy cannot grow beyond the limits set by the natural resources system from which the basic inputs come. With such great losses annually, the time it will take to approach these limits grows shorter every year.

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