{"id":1252,"date":"2012-04-04T11:50:36","date_gmt":"2012-04-04T10:50:36","guid":{"rendered":"http:\/\/avbp.net\/?p=1252"},"modified":"2012-04-04T12:32:33","modified_gmt":"2012-04-04T11:32:33","slug":"accounting-for-a-crowded-but-sustainable-planet","status":"publish","type":"post","link":"https:\/\/avbp.net\/?p=1252","title":{"rendered":"Accounting for a crowded but sustainable planet"},"content":{"rendered":"<div id=\"_mcePaste\">We need to change the way we account for things as we hit the resource wall. We cannot continue to regard, from an accounting point of view, resources as infinate.<\/div>\n<div>Her&#8217;s an attempt to form a sustainable approach:<\/div>\n<div>In my<a href=\"http:\/\/avbp.net\/?p=1244\"> last post<\/a> I argued that:<\/div>\n<blockquote>\n<div id=\"_mcePaste\">Technology is a collection of inventions and capabilities to solve a problem or need.<\/div>\n<div id=\"_mcePaste\">Work is the application of technology to deliver a solution to the problem or need.<\/div>\n<\/blockquote>\n<div id=\"_mcePaste\">Sustainable technology is a collection of inventions and capabilities to solve problems in a way that preserves financial, natural and mineral capital. Sustainable work applies sustainable technology to delivering the services required to live.<\/div>\n<div id=\"_mcePaste\">Let us take a group of people and for sake of argument let us take a village of 100 houses with 300 residents, some under age. High up on the list of required services would be \u00a0&#8211; not in any order \u00a0&#8211; access to 1) housing 2) food 3) security, 4) clothing.<\/div>\n<div><!--more--><\/div>\n<div>It is fairly easy to define all these services and \u00a0quantify and qualify them. Housing would be roof over head, certain number of square meters, temperature ranges, hygienic standard and number of days per year. Food, similarly, quantifies in terms of amounts and days of year and in terms of vitamin quantity taste etc.<\/div>\n<div id=\"_mcePaste\">We can also quantify and qualify the capital involved.<\/div>\n<h3>What would be a reasonable application of \u00a0financial capital?<\/h3>\n<p>Perhaps a break \u2013even on investment in 30 years to coincide with the life expectancy of the buildings and machines?<\/p>\n<div id=\"_mcePaste\">How much capital should be employed?<\/div>\n<div><strong>Some examples:<\/strong><\/div>\n<div id=\"_mcePaste\">\n<ul>\n<li>For natural capital the out-take of say, trees would have to correspond with re-growth. The same would be true of soil quality \u2013 there should be no reduction in solid quality.<\/li>\n<li>For any mineral resources reaching the settlement these should be balanced with those leaving. If iron is mined on the property it should remain available.<\/li>\n<li>For human capital we could discuss what would be reasonable percentage to employ \u2013 if some people were not involved in the provision of the service than that is under \u2013use. If everyone is involved and the provision is under standard then that is poor application of capital and technology.<\/li>\n<\/ul>\n<\/div>\n<h2>How to measure capital?<\/h2>\n<div id=\"_mcePaste\">If we make the total available as 100 then it is easy to create a figure.\u00a0For example, we have used half of the world\u2019s available oil and a third of the available coal and gas. We could have one figure for the present situation under \u201cfossil fuel capital\u201d.<\/div>\n<div id=\"_mcePaste\">For, say trees we could take the approach of the number of trees the year before last. (measured in cubic meters of wood or another measure)<\/div>\n<div id=\"_mcePaste\">For last year we could do the same and compare the two in a simple accounting equation:<\/div>\n<div id=\"_mcePaste\">Tree capital<\/div>\n<div id=\"_mcePaste\">\n<ul>\n<li>Last year\t This year<br \/>\n100 \u00a0 \u00a0 \u00a0 110<\/li>\n<li>Change<br \/>\n10%<\/li>\n<li>Rate of change per year estimate.<br \/>\n+6%<\/li>\n<\/ul>\n<\/div>\n<p>Air Capital<\/p>\n<p>Let us say that air capital at 100% is the &#8220;safe&#8221; ppm of 350 co2 and 400ppm is total depletion (100% minus 0% left)<\/p>\n<ul>\n<li>Last year<span style=\"white-space: pre;\"> <\/span> This year<br \/>\n382= 32 over or &#8211; 9% \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 393 =43 over or 12.2%<br \/>\n64% \u00a0 \u00a0 left \u00a0 \u00a0debt 95% \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 14% left\u00a0debt= 98%<\/li>\n<li>Rate of change<br \/>\n-50% per year<\/li>\n<\/ul>\n<div id=\"_mcePaste\">The approach could be applied to nations as well as counties, municipalities and estates and villages.<\/div>\n<h2>How to analyse performance?<\/h2>\n<div id=\"_mcePaste\">Having established a view of capital we can turn to analyzing performance:<\/div>\n<div id=\"_mcePaste\">Performance measures for provision of services required:<\/div>\n<div id=\"_mcePaste\">\n<ul>\n<li>Housing, food, clothing.<\/li>\n<\/ul>\n<\/div>\n<div id=\"_mcePaste\">Capital balance<\/div>\n<div id=\"_mcePaste\">\n<ul>\n<li>Capital employed, capital growth\/reduction: Financial, human, nature, etc<\/li>\n<\/ul>\n<\/div>\n<p>One of the things I like about this model is that it forces accountants to see that increasing financial capital on one hand does not\u00a0necessarily\u00a0show\u00a0improved\u00a0performance if the\u00a0corresponding\u00a0reduction in natural capital or even services is negative.<\/p>\n<div id=\"_mcePaste\">We now have the basis of a model to discuss sustainable technology in its wider meaning. And we have measure we can apply to the activities of society. Providing services to an acceptable level and impacting capital within acceptable limits.<\/div>\n<div>To understand the challenge a little more, take a look at the culb of Rome&#8217;s Limits to growth predictions:<\/div>\n<div><a href=\"http:\/\/gizmodo.com\/5898896\/1970s-study-predictions-are-still-on-target-for-2030s-decline-of-humanity\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter\" src=\"http:\/\/img.gawkerassets.com\/img\/17ihidrnzwy6pjpg\/original.jpg\" alt=\"\" width=\"400\" height=\"300\" \/><\/a><\/div>\n","protected":false},"excerpt":{"rendered":"<p>We need to change the way we account for things as we hit the resource wall. We cannot continue to regard, from an accounting point of view, resources as infinate. Her&#8217;s an attempt to form a sustainable approach: In my last post I argued that: Technology is a collection of inventions and capabilities to solve [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_bbp_topic_count":0,"_bbp_reply_count":0,"_bbp_total_topic_count":0,"_bbp_total_reply_count":0,"_bbp_voice_count":0,"_bbp_anonymous_reply_count":0,"_bbp_topic_count_hidden":0,"_bbp_reply_count_hidden":0,"_bbp_forum_subforum_count":0,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[9,7,29],"tags":[],"class_list":["post-1252","post","type-post","status-publish","format-standard","hentry","category-envelope","category-rethinking-money","category-sustainable-investment"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_likes_enabled":true,"_links":{"self":[{"href":"https:\/\/avbp.net\/index.php?rest_route=\/wp\/v2\/posts\/1252"}],"collection":[{"href":"https:\/\/avbp.net\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/avbp.net\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/avbp.net\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/avbp.net\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=1252"}],"version-history":[{"count":15,"href":"https:\/\/avbp.net\/index.php?rest_route=\/wp\/v2\/posts\/1252\/revisions"}],"predecessor-version":[{"id":1255,"href":"https:\/\/avbp.net\/index.php?rest_route=\/wp\/v2\/posts\/1252\/revisions\/1255"}],"wp:attachment":[{"href":"https:\/\/avbp.net\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=1252"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/avbp.net\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=1252"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/avbp.net\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=1252"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}