“Not to mean to insult anyone,” says Paul Sanford of the private investment-management company TriLinc Global, “but it can a bit myopic.”
As our societies develop and evolve, the question of measuring progress through different metrics has gained a more prominent place. Simple measures, such as the Gross Domestic Product (GDP), do not perhaps capture all the complexities of development that we want them to and this is where purpose-built replacements such as Gross National Happiness (GNH) come into play. The Student Reporter team at the World Resources Forum 2012 in Beijing, China was reminded of this problem when interviewing the 2007 Nobel peace prize winner Dr. Mohan Munasinghe. Although there were a myriad of topics such as sustainable consumption and production (SCP) and greening the economy, the question of the importance of alternative metrics is one that stuck. During his many talks at the conference, Dr. Munasinghe explored and encouraged the usage of alternative economic indicators in lieu of the ubiquitous GDP; indicators that could capture many other elements of economic, cultural, and societal value.
In my first lesson of economics nine years ago, we read a tale that conveyed Adam Smith’s underlying ideas behind the “Invisible Hand.” The morale of the story, as you probably know, is that free markets can make everyone better off. At Rio+20 the story is often told differently. Markets need to be tamed, incentives need to be rectified, and policy makers need to establish legislation that internalizes the negative environmental externalities. Hence, free markets are more often regarded as the problem, rather than as the solution. So what’s the right version of the tale when it comes to saving the environment?
Corporate reporting and assessment frameworks are powerful tools to help investors and consumers choose their investments and products wisely. In the wake of the World Resources Forum 2011, corporate sustainability assessments are an important tool to help consumers and investors drive change towards a less-resource-intensive world. One of the oldest, the Dow Jones Sustainability Indexes (DJSI) started in 1999 as a way to list the top 10 percent of sustainable global companies for investors. SAM, a boutique sustainable investing fund, invites the largest 2500 companies each year to submit sustainability data for DSJI scoring; companies are added and dropped from the list based on their performance. The process is third-party reviewed by Deloitte Consulting. Two companies that attended the World Resources Forum 2011 are ranked on the DJSI; Kraft Foods and Syngenta.
As the final plenary session of the conference ends, some key issues emerged for us to contemplate on and incorporate in our everyday lives. Power of the individual : Across academics and politicians, the general consensus is the need for not only systemic change but also transformative change. As Marilyn Mehlman says, there is a great need to face our fear of being one small entity in the society and doubt our potential as change agents. But we should think of ourselves as having the dexterity of a spoonful of yogurt has in transforming a bucket of milk to yogurt. It is time for us to bridge our differences and work as one planet.
We can’t be obsessed with the growth imperative anymore, we have to de-couple economic growth from the use of resources and its environmental impacts. Be resource-efficient, be smart, be innovative. No chance to miss these proclamations at the WRF 2011 as they resonate everywhere . Why? Evidently the classical model of economic growth measured by GDP that should deliver prosperity fails in one important aspect: whilst creating goods and services, it destroys one of its crucial bases; natural capital.