Reporting 3.0 Platform reporting3.org/ Selected References: Baue, B. (2017): Blueprint 3. Data Integration, Contextualization & Activation for Multicapital Accounting. Reporting 3.0. reporting3.org/wp-content/uploads/2017/07/R3_Data_Blueprint_Report-1.pdf Meadows, D. (1998): Indicators and Information Systems for Sustainable Development. Sustainability Institute. donellameadows.org/wp-content/ userfiles/IndicatorsInformation.pdf * Meadows actually repeats human capital here, but lists “wealth” in this section, so we took the liberty of re-labeling in order to conform with the field of multicapitalism that has emerged in recent years — for example through the International Integrated Reporting Council’s Integrated Reporting Framework and Mark McElroy’s MultiCapital Scorecard — trusting that this remains true to Meadows’ — and Daly’s — original intention. ---------- Forwarded message ---------- From: Great Transition Network <[email protected]> Date: Sat, Aug 5, 2017 at 7:45 AM Subject: Money for the People (GTN Discussion) To: [email protected]
From Bill Baue <[email protected]>
------------------------------------------------------- [Moderator's Note: Today's the last day for commenting, and then Mary will have her opportunity to respond. Thanks, all! --- JC] Monetization and Blockchain This has been a rich and wide-ranging conversation, so I’m chiming in now to add to one issue that’s been mentioned already, and address one issue that hasn’t been mentioned yet (as far as I can tell, though there has been so much posted I apologize if this is duplicative.) My opening caveat is that I’m specifically refraining from weighing in on the more ambitious proposal of the wholesale transformation of money. My contributions are far more humble and circumscribed. I want to discuss the question of “monetization” and make a related point about blockchain, which has already been discussed, though not from this angle, I believe. And a few preliminary words of the context from which these comments spring: a work that I wrote that was recently published by the Reporting 3.0 Platform (where I’m a Senior Director), in the Data Blueprint: Data integration, contextualization & activation for multicapital accounting. This report draws significantly from the 1998 report to the Balaton Group, authored by Donella Meadows, called Indicators and Information Systems for Sustainable Development. In particular, we draw on the "Daly Triangle,” named after Herman Daly (who is of course a member of the Great Transition Initiative network and has contributed to this dialogue). As part of our 12-month Data Blueprint collaborative development process, we took in feedback in a virtual dialogue (similar to this forum) that the Daly Triangle — which links the Ultimate Means of Natural Capital through the Intermediate Means of Human and Built Capital to the Intermediate Ends of Social and Financial* Capital to the Ultimate Ends of Well-Being — doesn’t reflect the notion of thresholds or the carrying capacities of the capitals** that Meadows stresses at one important point in her report. So, we took the liberty of “updating” the Daly Triangle in an effort to integrate such thresholds, borrowing the conceptual framework of Kate Raworth’s “Doughnut Economics” that posit ecological ceilings (inspired by Johan Rockstrom’s Planetary Boundaries) and social foundations. What we ended up with was the “Daly Hourglass,” with the capital stocks represented as cycles, and capital flows connecting the Ultimate Means to the Intermediate Means and Intermediate Ends to the Ultimate Ends — with the sustainability thresholds intersecting at the capital flows, thus discerning the carrying capacities of the capitals. I describe this primarily to note that the paramount importance of linking Ultimate Means (Natural Capital — which we know we as a people are now over-tapping on an annualized basis, as the Ecological Footprint that William Rees and Mathis Wackernagel co-conceived tells us Earth Overshoot Day was Aug 2) with Ultimate Ends (Well-being — or what Mary Mellor wonderfully calls “wellth”) Now, on to my main points: Monetization: Money is, as Mary Mellor points out, more a symbol than a tangible thing. Accordingly, money is used not only to “represent” financial transactions, but it’s also increasingly used as a “normalizing” mechanism to generate a kind of equivalence or comparability between otherwise disparate things. A carbon price, for example, is a kind of monetization. So as you see, I’m addressing an issue that’s related to Mellor’s essay, but not the main focus. But I believe it warrants inclusion in this discussion, because of 1) its increasing prevalence and importance and 2) the potential to “reform” its use, since it isn’t quite the Pandora’s box of money itself. In the Data Blueprint, we look at the case example of how The Crown Estate uses “monetization” in its multicapital “Total Contribution” accounting approach to “normalize” (or “commonalize” as they say) between the various positive and negative economic, social, and environmental impacts the company has on the world. We take a brief trip down a side alley to look at some of the critiques of such monetization (these focused on KPMG’s True Value Methodology, which is sufficiently similar to Total Contribution to make our point), primarily leveled at the ethics of such a move (KPMG itself acknowledges the ethical dilemmas involved in the academic journal that you can find referenced in the Blueprint). And here’s where the strands weave together: in the Data Blueprint, we applaud Total Contribution for taking a multicapital approach, but we critique its use of monetization in the absence of contextualization within the carrying capacities of capitals. Here, we lean on the work of Mark McElroy of the Center for Sustainable Organizations (who conceived Context-Based Sustainability, and with whom I co-founded the Sustainability Context Group in 2012), who has proposed that monetization makes sense only when contextualizing the carrying capacities of capitals, and he illustrates his point using “Context-Based Monetization Cost Curves” whereby the “cost” of a resource (say, the carbon cycle) is directly linked to the overall carrying capacity of that capital resource, such that costs are very low when the capital stock is cycling within the carrying capacity, and becomes increasingly expensive as the carrying capacity is neared, and prohibitively expensive when the sustainability threshold of the carrying capacity is crossed. Of course, Context-Based Sustainability (based as it is in the work of Dana Meadows, with whom Mark collaborated as Chair of Dana's Sustainability Institute) is predicated on managing capitals within their carrying capacities not just for the health of those resources, but ultimately for the sake of the stakeholders who rely on those resources for their well-being (wealth). So, as you can see, the idea of linking monetization to capital sufficiency in service of well-being is consistent with the premise of Mary Mellor’s essay, but is achievable without quite as much ambition and “disruption” as overturning our monetary system. Blockchain: In the Data Blueprint, we also present two pilot projects that use blockchain to track “transactions” — one pilot, a collaboration between Reporting 3.0, Radboud University, and Noorden Duurzam, is a “habitat-based” implementation to track financial, social, and ecological value flows in the north of the Netherlands. The other, a collaboration between Reporting 3.0 and Guard Global, applies to the investment realm, using XBRL tagging taxonomies to track such flows as well. Significantly, both pilots are seeking to integrate a contextual “filter” into the blockchain that assesses if the flow is “sustainable” — i.e. within carrying capacity. One of the benefits of blockchain technology is that it can maintain confidentiality (for example, of the actual data involved in the transaction) while simultaneously allowing for the authentication of that data within the blockchain — thereby enabling the scrutiny (assurance or auditing, if you will) of proprietary data without compromising the secure nature of the data. Here again, we believe that this approach to blockchain holds significant promise, as it enables the insertion of contextual assessment — namely, respect for sustainability thresholds that are tied to well-being (wellth) — in ways that are implementable within the existing financial and social regime, while also transforming those regimes in ways that align with the goals of the Great Transition. Thanks all of you for such a great dialogue! Best, Bill Baue Senior Director Reporting 3.0 Platform reporting3.org/ Selected References: Baue, B. (2017): Blueprint 3. Data Integration, Contextualization & Activation for Multicapital Accounting. Reporting 3.0. reporting3.org/wp-content/uploads/2017/07/R3_Data_Blueprint_Report-1.pdf Meadows, D. (1998): Indicators and Information Systems for Sustainable Development. Sustainability Institute. donellameadows.org/wp-content/ userfiles/IndicatorsInformation.pdf * Meadows actually repeats human capital here, but lists “wealth” in this section, so we took the liberty of re-labeling in order to conform with the field of multicapitalism that has emerged in recent years — for example through the International Integrated Reporting Council’s Integrated Reporting Framework and Mark McElroy’s MultiCapital Scorecard — trusting that this remains true to Meadows’ — and Daly’s — original intention. ** Here again, for absolutely strict accuracy, Meadows didn’t use the term “capitals” in association with “carrying capacity,” but she does discuss the capitals in depth throughout the report. ********************************** On Jul 1, 2017, at 9:31 AM, Great Transition Network < [email protected]> wrote:
From Paul Raskin <[email protected]>
----- Dear GTN, The old proverb—money is the root of all evil—may overstate the case, but money is, indeed, implicated in the iniquitous debt/growth spiral now degrading Earthland. Mary Mellor explains in her new GTI essay, “Money for the People,” that it needn’t be so. The modern money system is a social construct that evolved to spur capital accumulation, but lingers on in an era needing, instead, to throttle consumerism, debt, and the economic growth machine. Rather than creating money privately through bank lending, as the current system does, an alternative approach—public money—can undergird an economy oriented toward people and use value, not profit and exchange value. I think you’ll find Mary’s vision of a critical institutional pillar of a Great Transition economy illuminating, intriguing, and inspiring. Please read it at www.greattransition.org/publication/money-for-the-people, and let the comments and questions begin! How would public money work in practice? How would it interface with the market? How might its pursuit contribute to strategies for system change? Comments are welcome through JULY 31. Looking forward, Paul Raskin GTI Director HOW WE WORK Odd-numbered months are for internal GT Network discussions; even-numbered months are for public dissemination. You will receive all comments via email, and can review the entire thread online at www.greattransition.org/forum/gti-forum. The essay will be published alongside a “Roundtable,” comprised of selected comments from the GTN discussion and a response from the author. PS: Apologies for any difficulties getting to the website over the past couple days. It’s back up and running! ------------------------------------------------------- Hit reply to post a message Or see thread and reply online at http://greattransition.org/forum/gti-discussions/191- money-for-the-people/2420 Need help? Email [email protected] -- P2P Foundation: http://p2pfoundation.net - http://blog.p2pfoundation.net Connect: http://p2pfoundation.ning.com; Discuss: http://lists.ourproject.org/cgi-bin/mailman/listinfo/p2p-foundation Updates: http://del.icio.us/mbauwens; http://friendfeed.com/mbauwens; http://twitter.com/mbauwens; http://www.facebook.com/mbauwens