By Jussi Ahokas

Finland took over the Presidency of the Council of the European Union this autumn (from 1 July to 31 December). The timing of Finland’s third EU Presidency has been very interesting. The European Parliament election took place in May and during the autumn the construction of the new European Commission has been under way. The future choices of Europe and the next steps for policies of the European Union have been widely discussed. Hence, more room than usual has been opened for envisioning and reflection – what should be the desirable future path for the whole continent and the union of European nation states?

As the chair of the Council Finland has tried to seize the opportunity by bringing new initiatives to the European policy discussions. Most importantly, Finnish Ministry of Social affairs and Health introduced the Economy of Wellbeing policy approach that emphasises the fact that increasing the wellbeing of people creates positive outcomes for the economy. This in turn allows new investments to increase wellbeing, inclusion and participation. Thus, the Economy of Wellbeing presents the positive cumulative causation, or the virtuous circle, which will lead to the improving people’s capabilities to live good lives.

During the autumn many interesting events under the theme of Economy of Wellbeing have been organized. The high-level conference of Economy of Wellbeing in September in Helsinki brought together politicians, civil servants, researchers and civil society actors from different European countries. Economy of Wellbeing as a new policy approach was enthusiastically welcomed and almost all discussants seemed to be inspired by the concept. Later in October the EU council adopted conclusions on the Economy of Wellbeing which also portrayed the European wide interest on the new policy approach.

The civil society actors had important role in the high-level conference raising also somewhat critical voices on the current situation in Europe and the policy efforts of the EU. For example, the European Anti-Poverty Network (EAPN) and the Social Platform – European NGOs that organized their own events in Helsinki earlier in that week – reminded the participants that the guiding idea and policy goal of Economy of Wellbeing should be people’s wellbeing and that economy is only a tool for making this happen.

From the perspective of SOSTE Finnish Federation for Social Affairs and Health the message of EAPN and the Social Platform was of great importance. Indeed, in Finland SOSTE introduced the concept of Wellbeing Economy already in 2012 and slowly it has drawn more general attention in Finnish society. Before the EU presidency SOSTE was in close dialogue with the Ministry of Social Affairs and Health and it can be argued that the initiative of Economy of Wellbeing in Europe has its roots in civil society. This is a very good example of the power that NGOs and civil society can have in developing new visions and approaches that could change policies in the EU in the long-term.

The critical stance of NGOs – that the wellbeing of the people should always be the primary policy goal – has much importance, because the Economy of Wellbeing approach presented by the Ministry is also concerned over the “wellbeing” of the economy. There is a risk of “business as usual” being legitimised by the argument that besides the wellbeing of the people, we also need economic growth and sustainable public finances to achieve our goals. Hence, in time of an economic crises even austerity measures could be legitimised with Economy of Wellbeing approach.

Another important critique is the lack of – or at least too small – role for ecological and environmental perspectives. It is impossible to deny that at the time of climate crisis (and other ecological crises) the wellbeing of our planet is the most important policy issue and by neglecting it, we are not able to secure the wellbeing of people in our societies.

Therefore, it is very important that civil society actors continue to battle over the concept of Economy of Wellbeing in Europe. In the best scenario the initiative will bring us more policy space to build an actual Wellbeing Economy. An economic and social model that puts the wellbeing of all people and our planet first.

Mr. Jussi Ahokas is Chief Economist for SOSTE Finnish Federation for Social Affairs and Health – SOSTE is a member of WEAll

By Lisa Hough-Stewart

Last week WEAll was delighted to partner with Thomson Reuters Foundation to deliver a lunch event on wellbeing economics as part of their flagship Trust Conference in London.

Energy and ideas were flowing as a packed room full of leaders from the worlds of business, development and philanthropy (and beyond) discussed how we can better work together to transform the economic system.

WEAll Executive Chair Stewart Wallis inspired participants with a short introduction, explaining that “he’s been trying to change the world for a long time” and that what he had learned from over 50 years of work was that:

“Where a cause is both just & urgent, and we collaborate across barriers, it’s possible to achieve the seemingly impossible”

After Stewart outlined what the vision of a wellbeing economy looked like, participants round the table shared their dreams for what would change in the next ten years to help bring this about. Some named equality for all; others talked about decision making and monetary flows being based on solutions not problems; and we shared ideas about bringing all voices to the conversation and changing power structures.

It was clear that the vision for the world we want to live in is rich and shared by many – how we get there is less clear. This is where WEAll comes in – and Stewart invited everyone to participate as members or in some other capacity with our work.

The event was a great starting point for new ideas and relationships, and we are excited to build on this strong beginning.

It came as part of the two-day Trust Conference, which showcased innovative examples of pioneering business practices around the world and explored solutions to human rights challenges.

One highlight was a celebration of the Wellbeing Economy Governments partnership, with video clips of leaders Nicola Sturgeon of Scotland, Jacinda Ardern of New Zealand and Katrin Jakobsdottir of Iceland helping raise awareness of this important project.

I was personally incredibly impressed with two businesses in particular that we heard about: Nik’s Fudo in Geneva makes feminist economics a reality, providing business opportunities to migrant women enabling them to share their cooking skills and amazing food. Annie Cannons in the Bay Area trains and employs survivors of human trafficking in their cutting edge coding and tech company.

Both of these examples give me hope that innovation, entrepreneurial spirit, feminism and kindness can come together to support the type of future businesses that should one day be the norm. This is a wellbeing economy in action.

Wellbeing economics featured prominently in media coverage of the event, with Nicola Sturgeon’s TED talk being quoted:
“The goal of economic policy should be collective wellbeing: how happy and healthy a population is, not just how wealthy a population is.”

By Kristín Vala  Ragnarsdóttir

November 21, 2019

Vala is a WEAll Ambassador, member of the WEAll Global Council and leader of WEAll Iceland. She is Professor of Sustainability Science at the University of Iceland.

I often tell people about my epiphany that I had when I talked to the late Richard St George in Bristol (UK) in the year 2000.  He was then the Director of the Schumacher Society which held „the“ environmental gathering in the UK – every year – under the title: Schumacher Lectures. I was a Senior Lecturer at the University of Bristol (and had never heard about the Schumacher Society despite having lived in the city for more than 10 years).  We discovered during our conversation at my neighbour’s birthday party that we were both working on environmental issues.  I was working at the atomic scale – using Synchotron radiation at the Daresbury Laboratory near Liverpool to decipher the structure and coordination of metals and pollutants in water and on mineral surfaces.  Richard was working on finding ways to make the world sustainable.  He was thinking about the big picture.  I had lost the view of the big picture.

I had a shock once I learned how unsustainable our life on planet Earth was (and still is).  First I did not know what to do.  I spent a summer staring at my computer and did not know how to proceed.  But since being depressed is not my nature, I decided to figure out how an Earth scientist could contribute toward sustainability.  I moved up 15 orders of magnitude and sustainability has been at the centre of my research, teaching and operations ever since.

One of the things I decided I had to do was to minimise my own impact on the world.  I had my old car scrapped and I cycled, walked or used public transportation. When going to Europe I took the train.  I kitted out a loft for myself in an old paint factory with under floor heating, solar water heating, double glazing, sheep wool insulation, linseed oil paint…  I bought local and organic produce, stopped for the most part giving gifts, but instead gave Oxfam „gifts“ for the developing world, ranging from giving access to clean water, sanitation, vegetable gardens, goats etc.  If I bought anything for my extended family it was (and still is) a book on environmental issues.  And for whatever CO2 emissions I was responsible, I offset with supporting tree planting.

At the end of 2008 I moved to Iceland, my country of origin.  It was strange to move straight into the economic collapse in Iceland – where the ethical values I was raised with seemed to have vanished.  First I lived with my parents, then got myself a car and a flat.  Living in the same environmentally friendly way as in the UK was difficult.  Most produce is imported.  Going to conferences and workshop meant flying. Taking the ferry is possible, but takes a long time via Seydisfjördur (East Iceland), the Faroe Islands and Jytland in Denmark.  From there you need to take a train.  Seydisfjördur is 800 km from Reykjavik where I live and work.  Then the same distance back.

So I had to change my way of operating.  From Iceland I have travelled according the following principles since 2009:

  1. Will my presence at the summit/conference/workshop/symposium contribute toward the world becoming more sustainable? and/or
  2. Will l learn something that can help me support the world becoming more sustainable?

For my travel I still offset my emissions.  Not perfect, but better than doing nothing.

Move forward ten years and I recently had another epiphany. It is not enough to only consider sustainability issues, it is also necessary to consider gender balance issues. So from now on my traveling will be bound by a third principle:

  1. Have the organisers of the summit/conference/workshop/symposium provided a gender balanced environment for presentations/panels (and more broad balance of gender identifications, where appropriate)?

This third principle came to me after I attended an international summit recently, where we were either presented with „manels“ (men only panels) or panels with one token woman.  I had gone a long way from Iceland because I had hoped that the summit would focus on the voices of people from the global south, and women.  That was not the case.  All of the presenters were men. Only one African woman was given a voice on a panel.

When it dawned on me what was happening, at first I was furious, then sad, then I had the epiphany to make this third principle at the core of decisions of whether I will travel anywhere.

When I discussed this with two friends today, one suggested that I write a blog (thanks!) and another proposed a fourth principle:

  1. Will the summit/conference/workshop/symposium nourish my soul?

She also suggested this should be principle 1.  I agree (also thanks)!

By Samantha Kagan

Those who follow the development and proliferation of wellbeing economics are likely already aware that earlier this year, New Zealand became the first country to reorient its national budget and decision-making framework to centre on wellbeing expansion, rather than on GDP growth. The shift was momentous, and it was executed with the intent from the Government of improving its service to citizens. Minister of Finance Hon Grant Robertson claimed in his speech introducing the new approach that “The things that New Zealanders valued were not being sufficiently valued by the Government”, and this was leading to outcomes undesired by citizens.[1] However, he relayed confidence that implementing the new wellbeing framework would rectify previous missteps and improve outcomes delivered by government. The new approach was well-intentioned, but little evidence existed to support the notion that citizens are more satisfied with a government that pursues wellbeing expansion over one that focuses on GDP growth. I conducted a study to investigate this assumption, and I found evidence that the Minister, in fact, was correct: in New Zealand, citizens are more likely to regard the government highly when wellbeing expands, rather than when GDP grows.

I came to this conclusion using two complementary methods of analysis. First, I examined correlations between GDP and satisfaction with the government’s performance, then between wellbeing and the same measure. I found a tendency for government satisfaction to move more closely with wellbeing factors than it does with GDP level or GDP growth rate. Next, I distributed surveys to New Zealanders that pitted hypothetical policies against one another and asked participants to indicate which option they would support. One policy would grow GDP, while the other would expand wellbeing, and results showed a preference for the latter.

The findings of my study are encouraging, as they suggest leaders in New Zealand acted rationally by shifting government priorities to focus on wellbeing. The objective for adopting this scheme was to improve satisfaction among citizens, and it appears that the strategy was well-calculated. According to Adam Smith, the value of any government is judged in proportion to the extent that it makes citizens happy.[2] Leaders in New Zealand improved their performance in this sense and have good reason to claim victory.

In other nations where government satisfaction is a concern, leaders would be sensible to consider launching a response like New Zealand’s. In Iceland and Scotland, such action is already underway, as each country’s government has introduced a plan to comprehensively restructure its framework.[3] In Britain, although the proposal is yet to be approved, individual policymakers are pushing for wellbeing to take precedence over GDP in government decision making.[4] Examples set by these countries and findings like those in this study should motivate policymakers to contemplate pivoting toward wellbeing to earn more satisfied citizens.

While improving contentment of citizens is itself a valuable objective, the findings of my study also have important implications for policy options available to legislators. Traditionally, policymakers are bound by the paramount goal of GDP expansion. If an otherwise sensible policy appears to threaten growth, it is usually denounced for precisely that reason. This study suggests when a policy is generally constructive, the fact that it may hurt growth should not lead to its automatic dismissal, and if the policy will enhance wellbeing, then it should be given serious consideration. In response to issues like the climate crisis or worsening mental health conditions, the most effective solutions may not be those most conducive to growth. They may even diminish GDP. This study, however, suggests that the public would prefer policies that sacrifice growth in the name of wellbeing, rather than forego wellbeing to consistently safeguard growth. Therefore, policymakers should feel encouraged to maintain a level of indifference toward GDP while observing wellbeing as the primary measure of their legislative success. A new range of policies will become available to them, and citizens will likely become more satisfied as a result.

Samantha Kagan from LSE with a distinction in Inequalities and Social Science. This blog summarises the findings of her dissertation: “Satisfied citizens: how GDP growth and wellbeing expansion relate to government satisfaction”

[1] Robertson, G. (2019) ‘Budget Speech’. New Zealand Government. Available at: https://www.budget.govt.nz/budget/pdfs/speech/b19-speech.pdf (Accessed: 25 June 2019).

[2] Smith, A. (1976) The Theory of Moral Sentiments. Oxford University Press.

[3] WEGo: Wellbeing Economy Governments (2019). Available at: http://wellbeingeconomygovs.org/ (Accessed: 7 July 2019).

[4] Partington, R. (2019) ‘Wellbeing should replace growth as “main aim of UK spending”’, The Guardian, 24 May. Available at: https://www.theguardian.com/politics/2019/may/24/wellbeing-should-replace-growth-as-main-aim-of-uk-spending (Accessed: 7 August 2019).

By Katherine Trebeck, WEAll Knowledge and Policy lead

Ideas can change the world. And misplaced ones can hold back progress. Myths and half truths about economics influence decision making across government and in business, and there are fundamental flaws in how economics is invariably taught.

To build an alternative and underpin the transition to a wellbeing economy, we need a strong and coherent knowledge and evidence base. Much is already known about what policies and ways of doing things need to change to change the world. But the theoretical base is disparate and would-be practitioners lack useful guidelines for implementation. The knowledge is scattered and often inaccessible.

So, what’s WEAll doing?

WEAll – via the Knowledge and Policy cluster – is helping bring together and promote wellbeing economy theory and practice.

We’ve been producing a diverse suite of knowledge products accessible to all sorts of practitioners, policy makers, and interested individuals.

We’ve gathered some of the most exciting and well-regarded thinkers on aspects of a wellbeing economy in a WEAll Research Fellows Network. Their work explores all corners of a wellbeing economy. They will contribute to the various publications WEAll is curating. Their expertise will be drawn on to help practitioners and politicians seeking to create a wellbeing economy.

We’re developing plans for an online interactive library. Interested people will be able to find their way to the most useful material for their interests, needs, and level of awareness.

We’re commissioning synthesis of the current state of the knowledge base in various areas of a wellbeing economy in our series ‘WEAll Ideas: Little Summaries of Big Issues’.

We’ve outlined how the wellbeing economy would deal with and respond to a range of issues, topics and challenges (and how this differs to the response of the current system). This provides an ‘at a glance’ insight into a wellbeing economy (see wellbeingeconomy.org/oldwaynewway).

We’ve published dozens of blogs, authored papers and articles for a range of outlets and even some books. We’ve also given media interviews; recorded many podcasts; and given presentations in many different countries to a range of audiences. You can see these featured in the WEAll news updates.

We’ve been active in policy influencing – speaking at All Party Parliamentary Groups and holding meetings with civil servants and members of parliament.

Leadership built on ideas

And of course WEAll instigated the Wellbeing Economy Governments partnership that was the ‘big idea’ at the centre of Nicola Sturgeon, the First Minister of Scotland’s 2019 TED talk. We have ongoing liaison with the civil servants leading this work and are supporting the engagement of additional members.

Without the ideas, energy, guidance, expertise of our members, this work would be slow going. Instead it has momentum and ambitious plans.

With your help, we can build on our strong start and sustain this work to build solid roots for the wellbeing economy movement.

 

Right now, WEAll is running our #WEAllGive fundraising drive so we can keep broadening the movement and developing the knowledge required to drive change.

Donate today to help make it happen.

The circularity paradox in the European steel industry

What happens when solutions to economic system challenges start to create their own problems?

Researching the European steel industry, Dr Julian Torres discovered that the more integrated supply chains are, the easier it is to track the lifecycle of steel alloys and the elements that go into them. Higher levels of integration make it easier to bring steel back via reverse logistics without losing too much value. The more you do this, the less iron ore you need to mine and melt, and the longer the reserves of high-grade iron ore – which needs less energy to transform into steel – will last. And integrating supply chains does not necessarily mean having the different steps all within the same company.

Recycling, remanufacturing and refurbishing are indisputably important tools for reducing our consumption of natural resources. These activities contribute to what scientists call circularity: making sure we use materials for as long as possible, over and over, so that we exploit nature less and less.

Doing so requires creating what are called “secondary markets”, where used materials are gathered up, reworked and injected back into the economy. While this is an essential part of creating circularity, there can sometimes be unintended and negative consequences. A striking example is the secondary metals market: it has been a success), creating new jobs and business opportunities), but the environmentally friendly goal that it once had is no longer a priority.

In Europe, we recycle more than 70% of used steel on average, and just over 30% of all recycled or remanufactured steel is produced in furnaces that use electricity rather than burning coal. Not bad, but no longer enough when considering the increasing steel demand from developing nations, which are growing rapidly.

 

Read Julian’s recent piece for The Conversation here explaining his findings, and what the steel industry can do to improve.

He has also created this entertaining video to help explain the circularity paradox – a.k.a. the “little monster” Scrappy! Check it out, and be sure to share it.

Dr Julian Torres is a recent graduate of the AdaptEcon II PhD programme. During the Programme’s final retreat in Iceland in August he participated in workshops with the WEAll Amp team. Julian received funding from the European Commission’s Horizon 2020 Programme via a Marie Curie Fellowship on Excellent Research (grant agreement 

675153). Julian is a member of the International Society for Industrial Ecology and a Board Member of the Jean Monnet Excellence Center on Sustainable Development.

Photo by Scott Webb from Pexels

By Isabel Nuesse

On October 10th, WEAll Scotland held an event in Edinburgh in collaboration with Baillie Gifford and the Global Ethical Finance Initiative.

“The transition to a sustainable economic system: what’s the role of finance?” raised questions of the future of finance and how the sector can adapt to the challenges of the 21st century. The speakers were Frank Dixon of Global Systems Change, Jessica Runicles of Business in the Community and Andrew Cave of Ballie Gifford, hosted by WEAll’s Lisa Hough-Stewart.

Frank Dixon presented his concept of System Change Investing (click to download PDF) as a proposal for an approach the finance sector could take, modelled on his extensive experience developing SRI frameworks. He questioned, what if the finance sector applied the rule of law (“do no harm to others”) to their thinking? How would that effect the systems that make up the sector as well as the investments that are made inside it? He argued that investing in systems change is the most important action needed to solve climate change and address the Sustainable Development Goals.

The conversation then evolved into speaking about the role of business in environmental and social governance. Jessica Runicles emphasised how important it is for financiers to educate businesses on their opportunities to become more responsible. While explaining the Responsible Business Map she talked of some challenges she has with businesses not grasping the profitable opportunities better business can present.

Our final speaker was  Andrew Cave from Baillie Gifford who had the audience watch this video, “Corporate Scandals that Changed the Course of Capitalism.” He spoke about Baillie Gifford’s long term investment and engagement strategies and their new communications approach which emphasises the need for investors to “help shape the new world – not just shore up the old one”.

After the speakers presented, we had a panel discussion where the audience was able to ask questions. It was clear that education is a huge missing piece in elevating the role of finance in society. It was discussed that radical transparency is also necessary to increase the understanding of how the finance sector works and more specifically, how individuals and business can take more aggressive steps to move money into more socially responsible initiatives. The event provided a valuable opportunity for finance professionals and other interested attendees to share their challenges in creating change openly and honestly, and it was the start of a valuable conversation that WEAll will continue to drive forward.

Follow @WEAll_Scotland to find out about other upcoming events in Scotland. If you’re interested in getting involved with WEAll’s work on finance within Scotland contact us here.

 

Last week thousands of Chileans took to the streets to demand action on inequality, with a focus on pay ratios. These were the biggest demonstrations in the country’s history – and unusually, they stemmed from the world of business.

Pedro Tarak, WEAll Ambassador and co-founder of Sistema B is based in neighbouring Argentina. Sistema B works across Latin America and the globe to redefine the sense of success in economics, and Pedro explained how the current mobilisations in Chile  started with B Corp businesses:

“A few B Corps started to convene around the reduction of the salary gap and in less than 24 hrs 210 companies were on board. After 36 hours, over 330 business had commited publicly. In 64 hours, 548.

The campaign has two asks: a maximum salary ratio of 10:1 and/or minimum salary 67% higher than the minimum legal salary.

What is unique and very new is that the 10-1 Ratio has been adopted by market dynamics rather than public policy. I do not know of other regions where this has happened.”

 

Pedro shared emotional images and videos of masses of people in Chile hugging, creating music together and talking in small circles during the street protests: a very different picture than the one shown by international coverage of the events. On the streets, both situations co-exist: peaceful and occasionally joyful mobilisation; and also sacking of supermarkets and burning of metro stations.

“The inequality crisis is becoming as urgent and with the same level of importance as the climate crisis,” said Pedro.

“My sense is that we need to declare a global inequality crisis – it is completely intertwined with the climate crisis. We need to go to the different roots very quickly (eg. shareholders primacy).

We can’t wait for politicians, we must make deep practical and private legal changes by mobilising as individuals and communities. Of course, in theory politics is the space for large scale solutions. But when you have millions on the street, civil society alone seems not to be sufficient and the market becomes a new horizon for massive changes. The current events in Chile demonstrate that business has a role to play in bringing about system change.

When political systems are slow, we need to explore other spaces where citizens use their power.”

In less than a week, over 1200 companies in Chile have now signed up to the ’10x Challenge’ – the number continues to rise.

The campaign explains that in Chile, on average, the salary of a General Manager exceeds 30 times that of its operators and 47 times the minimum salary. It provides platforms for companies and employees alike to engage with the campaign and put pressure on business leaders to take up the challenge.

Find out more and support the campaign here.

 

 

 

 

What we talk about when we talk about a wellbeing economy

By Claire Sommer for the Wellbeing Economy Alliance

 

 

There’s a famous book of short stories by American author Raymond Carver called What We Talk About When We Talk About Love. Published in 1981, the book is an impressionistic whole created from 17 short stories about love.

The title captures the challenge of talking about something truly undefinable, by offering 17 stories with differing perspectives.

In the same way, our Wellbeing Economy Alliance community faces the challenge of describing a wellbeing economy and how to talk about it.

Earlier this year, Lisa Hough-Stewart and Katherine Trebeck asked for my help to distill key points from content developed by members into a simple set of high-level statements. These “anchor statements” are meant to help align our website and brochure, and create stronger pathways to all of our resources and content. 

We started with three key assumptions:

  1. We need simple, easier-to-understand language that helps people see themselves in our work, and want to know more. These points open the door for conversations and understanding.
  2. We need bullets that help us all succinctly articulate what a wellbeing economy means, to the greatest number of people – in short, easy-to-understand language. 
  3. The perspective we used is that WEALL says the What and our members create the How with campaigns, asks, and actions. WEAll supports our members.

The first draft turned into a fascinating conversation with members of the WEAll Narratives cluster via Slack, with members contributing suggestions and improvements from all over the world. It’s my pleasure to share just some of the wonderful contributions from the community below.

First, here are the five key points we landed on.

WEAll need…
  1.     Dignity: Everyone has enough to live in comfort, safety and happiness
  2.     Nature: A restored and safe natural world for all life
  3.      Connection: A sense of belonging and institutions that serve the common good
  4.     Fairness: Justice in all its dimensions at the heart of economic systems, and the gap between the richest and poorest greatly reduced
  5.     Participation: Citizens are actively engaged in their communities and locally rooted economies

While quite simple, we believe that these points are a sturdy set of wheels to help convey the Wellbeing Economy Alliance members’ initiatives and scholarship to more people and where we wish to go together. As Chris Riedy wrote, “When we faithfully carry these principles through into actual policies and programs, we do end up with proposals that are very different to what we have now.”

The first quality of Dignity came to mind from Donna Hick’s 2011 book of the same name, and Michael Pirson’s application of dignity as a pillar of Humanistic Management. In Slack, Martin Oetting added another nuance by noting that “dignity” is the first article of the German constitution: “Human dignity shall be inviolable. To respect and protect it shall be the duty of all state authority.” 

The second point about how to include Nature, or the natural world, grew from contributions by Dan Feldman to help us remember to seat ourselves as inextricably part of Nature, rather than separate from human society. We hope that “We all need nature” does this in an intuitive way.

Connection came into the list as an improvement on the less inspiring “collaboration” and helped us raise up “belonging”-ness as essential to wellbeing.

In the last point, we thank Juliana Essen as well as others for helping Participation enter the conversation. “Participation signifies active engagement, and there’s lots of research, for example in the field of deliberative democracy, that talks about how to create truly participatory processes that value difference and negotiate power differentials,” she wrote. “That’s the kind of participation we want.”

Keeping ourselves to a handful of statements was a challenge. We hope the inclusion of “happiness” in the first point is flexible enough to embrace meaning-finding, art, and whatever else people may need to enjoy life. We invite your reflections and comments about these five points on Slack, to lisa@WellbeingEconomy.org, or me at claire.sommer@grli.org

 

The OECD has convening power. It has influencing power. And it has the power of its policy advice. It can prescribe changes that are listened to the same way a patient listens to their doctors advice.

So when the OECD’s regular gatherings on measuring wellbeing and shaping policy show signs of moving away from the cosy ‘GDP and beyond’ mantra and the non-system-challenging focus on treatment, then it is worth taking notice.

There’s a new regime in town.

In Paris over one hundred people spent two days hearing from the governments leading the effort to embed a focus on wellbeing into policy agenda. By the end, people were joking that the audience must have ‘framework fatigue’.

Diverse governments, from the UAE to Iceland, from Scotland to Jersey, from France to New Zealand, from Finland to Paraguay set out their efforts to shape policy-making – and, crucially – budgeting, in accordance with promotion and enabling of wellbeing. Discussion was about taking this seriously, changing planning and spending accordingly: the OECD Secretary-General told the audience that: “if it ain’t in the budget, it ain’t really a priority”.

Tensions between different conceptions of wellbeing were, thank goodness, not swept under the carpet as they often are in such discussions. People recognised that a focus on multidimensional wellbeing and the drivers of wellbeing was not the same as rallying around a single number measuring subjective self-reported wellbeing.

But what is done with any measure matters: Professor Jeff Sachs warned that looking at narrow measures means narrow perspective: “the stock market rising”, he said “but US life expectancy is falling, [the US has a] suicide and opioid epidemic – our country is in crisis, but we don’t know it’s a crisis because we don’t look at the right data; this question is not even asked”.

Speaking of drugs, Sachs (channelling WEAll Ambassador Robert Costanza) likened the prevailing money and growth focus to an addiction: “making money is addictive and we have an addiction”. This was reinforced by Martine Durand, OECD Chief Statistician and Director of the Statistics and Data Directorate who said “GDP was never meant to measure wellbeing; it’s been abused and now we’re addicted to it – need to go to a clinic to stop this addiction”. Fortunately, the doctors on duty are willing to look the patient in the eye and tell them some hard truths.

One of these is grappling with the need for both of the ‘two S.C.s’ as I described them. This first is a focus survival and coping – treating people whose wellbeing is low. This is, of course a humane response. It is also not enough in the face of an inhumane economy that is the root cause of so much anxiety and stress, to both people and to planet.

Hence the need for the second ‘S.C.’: system change that asks why people’s wellbeing is low and what changes in the economic set up need to be undertaken in response? Gabriela Ramos, OECD Chief of Staff challenged delegates to think beyond celebration of amelioration: “Even the existence of social safety nets tells us people are falling and we need to catch them. But how do we keep them from falling?”

In terms of system change, there was also a frank discussion about the relevance of a growth orientated agenda in the richest countries. Of course ecological economists and others have been questioning this for years, but to have senior members of the policy making establishment state that growth doesn’t matter for quality of life in GDP-rich countries (asserting it is “irrelevant for rich country’s wellbeing”) and to even question why the OECD would maintain a programme under the heading of ‘Inclusive Growth’ seemed to be a new high point for the post-growth conversation.

Finally, an impatience with the disconnect between what the wellbeing community has been measuring and saying for years and slow progress in shifting the economic agenda was apparent. Angel Gurría, OECD Secretary-General, opened the conference by saying the world is “well past the point when a lack of data is an excuse – [now the] need is to rationalise and choose and targets which are the relevant indicators”.

If these two days were a heartening stock-take on the state of the debate on wellbeing measures and policy agendas, their timing was just as useful: Finland is currently President of the EU and has made the ‘economy of wellbeing’ it’s flagship agenda. At times, the Finnish contribution seemed a little out of place, better suited to a gathering 5 years ago in that it emphasised the business case for wellbeing and asserting that if governments boost wellbeing that will boost growth. Fortunately, if the rest of the OECD conference was anything to go by, the thinking has moved on and the question is now “what can growth do for wellbeing?”. Not the other way around.

By Katherine Trebeck, WEAll Knowledge and Policy lead

Anna Chrysopoulou is a volunteer with WEAll Scotland – she has written this blog to mark Challenge Poverty Week 2019.

“What does economic growth, measured by GDP[1], tell us about essential issues such as poverty and social inequalities?

Technically nothing. As long as the economy is growing in terms of production and consumption, the country is considered successful. When it comes to the distribution of wealth, are we still successful when poverty and social discontent are rising?

Having a job and yet struggling financially

Although GDP ignores factors such as pay gaps, unpaid work and inequalities, what it does measure is paid work. What if employment does not guarantee the route out of poverty?

Working or in-work poverty, which describes households who live in relative poverty even though someone in the household is in paid work, is a rising issue. The Scottish Government in 2015 issued a report which proved that the majority of working-age adults (52%) in Scotland are in ‘in-work’ poverty, and this figure has been gradually increasing. Indeed, in 2017/2018, working poverty increased to 60% (representing 390,000 working-age adults after housing costs), which means that more people are locked in daily struggle.

Let’ s add now to the conversation social inequalities. Our economy creates powerful currents that could easily pull any of us into poverty.

Women, ethnic minorities and disabled people are more at risk of poverty

Poverty in Scotland has a female face; women are more likely to be living in poverty compared to men. In 2015-2018, the poverty rate for single working-age women was higher than for single adult men, whether they had dependent children or not.  The same relation is found to pensioners, as the relative poverty rate is higher for single female pensioners than male. Apart from the pay gap, one of the reasons for this difference is that women are the majority of low paid workers, due to what is usually considered “women’s work”, such as cleaning, care and retail, being underrated in the labour market.

These figures follow a global trend which shows that it is harder for women to escape poverty. And of course, not to mention unpaid work, such as childcare and housework, which is not even taken into account. According to Oxfam, women do at least twice as much unpaid care work than men, with an estimated global value of $10 trillion, equivalent to one-eighth of the world’s entire GDP.

Social inequalities appear in terms of race and disability, as well. Relative poverty rates are higher where a family member is disabled[2] and are also higher for ethnic minorities. People from minority ethnic (non-white) groups are more likely to be in relative poverty from the ‘White- British’ group. A report in 2017 revealed that poverty in BME[3] communities is twice that of white communities, which is even worse for BME women as they are more affected by austerity. Unemployment levels in many ethnic groups, which is strongly related to poverty and is holding people down, are also higher than most of the Scottish population.

So when we aim to tackle poverty, inequalities ought to  be considered thoroughly and comprehensively.

This evidence demonstrates that we cannot measure everything using economic growth and a monetary system. Living in poverty cannot be described only with numbers. It affects all aspects of one’s life, including those such as mental health that are not measured and therefore, are ignored.

For this reason, it is vital to redesign our current narrow economic system, which keeps failing to show the big picture and focus on people’s wellbeing rather than the economy itself. Scotland could lead the way on that.

Nicola Sturgeon, Scotland’s First Minister, stated in her recent TED talk that “the objective of economic policy should be collective well-being. What we choose to measure as a country matters. It matters because it drives political focus and public activity”.

A wellbeing economy that places people and the planet first is necessary.  This wellbeing economy could be the solution for poverty and social injustice. It is based on the creation of a society that accounts for nature, distribution of resources and better quality of life for everyone. It aims at social, economic and environmental justice and suggests alternative business models, like the employee ownership model that as Sarah Deas, board member of WEAll and former director of CDS, explained: “fosters ‘predistribution’ of wealth with employees,  while companies perform well in terms of productivity, inclusion and innovation”.

And as Katherine Trebeck and Jeremy Williams argued in their book The Economics of Arrival “Growth up to a certain point is important- and countries and people below their respective threshold points need more of it, as long as it is good quality and distributed well. After that point, however, societies need to become better at focusing on the quality of the economy instead of its size. Bricks and mortar are the material foundations of a house, but they are not what constitutes the warmth, welcome and comfort of a home- that stems from relationships, security and personalisation”[4].

Maybe this exactly how we should think of our economy.”

 

References

[1] GDP: Gross Domestic Product which measures the total value of all goods made, and services provided, during a specific period of time.

[2] Since 2012/2013, disabled people are identified as those who report any physical or mental health condition(s) that last or are expected to last 12 months or more, and which limit their ability to carry out day-to-day activities

[3] Black and Minority Ethnic

[4] Trebeck, K. and Williams, J. (2019). The Economics of Arrival. 1st ed. Bristol: Policy Press, p.71.

Let me start by telling you a secret, you can’t tell my boss though. When I first got a job at The Equality Trust I didn’t really know what inequality was. This is probably partly down to my privilege, but if you asked me to define it, there and then, as I was being interviewed, I’d have been toast. 

So when I started at The Equality Trust, I did what everyone does, I googled it. Then I read books on it, really good books. Then I watched Ted Talks on it and listened to podcasts but still it couldn’t quite stick. I couldn’t quite make sense of it in my head. Until I heard a story about it

Then I got it. Inequality is everywhere, every time you get that sick feeling of injustice in your stomach, the feeling you can’t define when you are a child, the feeling of sadness at the state of the world, that’s inequality. It’s everywhere and ever present. 

So how do we fight inequality? Well how about stories? After all, it worked for me.  

At The Equality Trust we have created a new platform to hear people’s stories about their experience of inequality… and it involves you. It’s called Everyday Inequality and brings home all the stats: think Humans of New York meets Everyday Sexism, but we’re talking about inequality in all its forms. 

We are facing unprecedented changes to our world. The climate crisis, shockingly unfair  levels of income distribution, insecure work and unequal pay. Inequality is entrenched in all these issues, yet there is no platform or forum providing information or access to the lived experience of inequality or its everyday impacts. Amongst the statistics, policy briefings and panels of experts, we forget real people’s voices and stories of inequality are lost. 

Everyday Inequality aims to change this. We are bringing together blogs, interviews, podcasts, poetry, music, art, videos and photography that showcase the real, diverse stories of what inequality feels like.

Videos, words, poems, performances – all forms of creative storytelling are welcome. Anyone can contribute, you don’t need any experience or a specific story to tell. You just need to be open to starting a conversation and talking about your personal experience, in whatever form you are most comfortable. We want this to be diverse and unique. Because inequality is bad for all of us, not just for people at the sharp end but those at top as well.

To find out more about the project, please get in touch with  frankie.galvin@equalitytrust.org.uk or visit our sign up form here. 

Frankie Galvin is Campaigns and Administrative Assistant at the Equality Trust

By Henry Leveson-Gower, Founder and CEO of Promoting Economic Pluralism

Thank you to everyone who took the time to get involved in the first round of nominating and voting for the #NotTheNobel Prize. We have been really pleased with how many people have taken the time in nominating, commenting and voting. We hope you have found the process so far fun and interesting.

I was really pleased to see some nominees that I had never come across before, which is great. I hope to follow up with them and feature them in The Mint, our magazine, in future issues.

We have now selected seven finalists. You can see their details and related information here. We decided to choose seven finalists to have a diverse field and there was a clear gap in voting numbers between the top seven and next most voted for.

I hope you find it interesting learning more about them. We have tried to summarise their achievements from the nomination and comments, and add links to further information and related articles in The Mint. You can also go back to look at the original nomination and comments.

In the 1st round, it was possible to vote for as many nominees as you liked. We have taken a different approach in the final round. You can vote for your top 3 and order them into 1st, 2nd and 3rd. Your 1st choice will get 3 points, your 2nd 2 points and so on. We hope this approach will ensure the winner is supported by a wide range of those who vote, while not requiring people to range all seven.

You can now start voting and even change your mind later! The button to go to the page to vote is on the same page here. We are using google forms as having looked at a lot of options this seemed the most straightforward while also ensuring people only vote once! You do though need a google email to login and you can find out how to get one here. You can also change your mind and edit the form up until voting closes at the end of our final event on 3rd October 7-8pm UK time. More details to come on that very soon…

Ultimately though clearly the point of this prize is not to select a winner but to create a broader discussion about different ways of understanding and organising our economies. Please do provide comments on the finalists at the bottom of their pages and join the debate on twitter and facebook, #NotTheNobel.

Thanks very much again for taking the time to give your view on the solutions we need to survive and thrive in the 21st century. I think we definitely need some positive visions in what can seem like an every more frightening and challenging world.

Vote now

Marine Tanguy is CEO of MTArt

Contemporary research into future cities tends to focus on technology, architecture and infrastructure.  Art in Smart Cities  is a recent study that highlights the importance of public art projects for our future cities.

Very little evidence and academic studies exist to determine whether or not public art is core to the life and demand of citizens. My co-author Vishal Kumar and I collected data at two public art initiatives organised by MTArt Agency. We found that 60% of the sample audience were willing to pay at least £5 for the implementation of more public art in their local area, with 84% willing to pay at least £2, and 84% of our sample said regular public art initiatives would increase their wellbeing.

The main motivations of this work are to shine a light on the value of public art initiatives. The smart city concept is inclusive and based on cross-pollination: public art projects are representative of this complexity as they should involve art experts, urban planners, economists, sociologists, political scientists as well as citizens.

It is important to understand the economic value of public art initiatives within the smart cities context because it will allow policy makers, urban planners and developers to implement such initiatives in the future. The dialogue must be open and eclectic in its methodological approach. It calls for a different, much closer, relationship between cultural institutions and empirical researchers than has been the case to date.

Our study is here to encourage economists to work and value public art projects: it shows a demand which can be expanded to all future cities and worth studying while the public art value reveals itself to be key to citizens.

Hopefully this study is also encouraging to more cultural institutions to partner up with data analysts to lead stronger research into their audiences, the impact these projects generate and the support that they may get from them. Historically, the unwillingness of cultural institutions to engage with the tools of economics has resulted in little progress in valuing art projects, specifically public art ones. No doubt this is in part due to the unfamiliarity at using the language of consumer surplus and willingness to pay and we hope this study helps making it a more familiar method.

We also wish that this study could be the start to a long-term aim of systematically building a rigorous body of evidence which can be used to understand the value of public art projects in its various forms.

Founded in 2015, MTArt Agency is an award-winning talent agency which represents the top visual artists. While the art world concentrates on selling art on walls for a few, we focus on investing in the top artists who could inspire everyone. Every month, the agency reviews 200 portfolios of artists. Our selection committee select artists with innovative techniques, inspiring content and strong visions. Find out more.

Image: MTArt ‘Don’t Think Twice’ project by Jennifer Abessira at London Bridge

This piece was first published by the IMF on their Finance and Development page

As governments are slowly turning their focus from raw GDP-driven measurements toward well-being criteria when judging economic success, the demand for progressive social justice policies is increasing. This is why many policymakers are examining how Iceland, which enjoys a relatively strong economy, has made gender equality a core part of its domestic and foreign policies.

The campaign for women’s equality in Iceland has demanded government action to liberate women from social structures that have kept them down for centuries. This includes legislative changes for women’s sexual and reproductive freedoms as well as robust equality laws and gender quotas for corporate boards.

But it has also required policies that are, in conventional economic terms, considered extremely expensive. And the price tag still prevents many governments from adopting them. The key topics here are universal childcare and shared parental leave. If applied properly, these policies have the potential to change the makeup—and the rules of the game—of both the public and the private spheres. Why? Because they enable women to participate in the labor market and public decision-making, while making space for men to share domestic responsibilities. Yet these family-friendly policies have not won the global support they deserve and are seen by many as a vast opening to profligate public spending.

Fifty years have elapsed since Robert Kennedy rightly said that GDP measures everything except that which makes life worthwhile. Economics is nonetheless still centered on the measurable, dividing government outlays into two categories: expenses and investment. This dualism classifies money spent on physical infrastructure as an investment and, therefore, worthy of public monies. On the other hand, social infrastructure is branded as expenses or operating costs, preferably the first in line to be cut. Yet these are the structures that sustain us from (before) birth to death and create the conditions that make life worthwhile.

Interestingly, physical infrastructure—roads, tunnels, buildings—is often the platform for men’s employment, while women are much more likely to be employed in services associated with social infrastructure—education, childcare, health care. By focusing on physical infrastructure to the exclusion of social infrastructure, economists and policymakers ignore an obvious truth: we need both in order for our societies to thrive and develop. What is a school building worth without quality education for all? What is a hospital building without the people providing the health care? And what is the value of a road or a tunnel in a society where illiteracy prevents social mobility?

In this narrow view of the world, it is not surprising that universal childcare and parental leave are considered luxuries rather than essential features of a successful economy. In fact, however, they are an integral part of building a society where everyone can flourish. If there is anything that people living in the 21st century—the century of gay liberation and women’s liberation, to name two—should know better than those living in the previous one, it is the benefits of liberating people from predesigned social norms and structures.

There is a striking difference between women’s labor participation in countries where childcare is available and affordable, and in countries where women are forced to choose between family and career. Where the costs of childcare are high, mothers in lower-income groups cannot afford to work. To be sure, a cultural shift could enable families to turn away from the traditional male breadwinner model. But the gender pay gap will continue pushing men into work while keeping women at home. And as long as our societies are constructed in such a way that women need to take long breaks from work to care for their families, this pay gap will remain as persistent as ever.

In recent decades, the Nordic countries have developed shared parental leave schemes that offer a specific “use-it-or-lose-it” portion for both parents (including same-sex couples and adoptive parents). The Icelandic model—funded by government and businesses—offers three months of leave to each parent and an additional three months that can be divided between the parents however they choose. My government will extend this entitlement further. This is part of a broader effort aimed at closing the gap between parental leave and publicly funded, high-quality day care now starting at the age of two, a gap that is now mostly covered by subsidized childminders.

The current model has been implemented in stages since 2000 and has—along with universal childcare—transformed Icelandic society while simultaneously boosting the economy. A shift in mind-set has occurred: families now consider parental duties and care the equal responsibility of both parents. Fathers have formed better relationships with their children, and the old excuse that women cannot be hired or promoted because they will (all!) drop out of the labor market no longer holds water. On a personal note, I would not be both a prime minister and a mother to three wonderful boys if not for my country’s family-friendly policies.

Does this mean that Iceland has cracked the code and that everybody enjoys equal rights and opportunities? Unfortunately, it does not. The gender pay gap still exists, and jobs typically held by women are still undervalued and underpaid in a labor market that remains far too gender-segregated. We have not managed to eradicate violence and harassment, and our children are subjected to gender stereotypes just as children are everywhere in the world. But we have made progress. Women’s labor force participation is around 80 percent, or a bit below men’s 87 percent, and yet it still roughly matches the Organisation for Economic Co-operation and Development average for men. The extensive economic activity of all genders is one of the key ingredients in Iceland’s economy, where the unemployment rate is remarkably low at only 2.9 percent.

The inclusion and liberation of the many, rather than the few, is the right thing to do not only from a social justice perspective but also from an economic perspective. It is one of the many reasons Iceland is now taking part in the group of Wellbeing Economy Governments, working toward sustainability and well-being for all, within the context of the United Nations’ Sustainable Development Goals.

Gender equality is an important part of this agenda, and it does not come about automatically. It requires an ideological vision, political struggle, and action on the part of governments, businesses, and social groups. The liberation of women and minority groups continues to be one of the urgent tasks of today’s politics. We must forge ahead with progressive economic policies that defy common stereotypes about costs and benefits and keep on promoting gender equality as part of a forward-looking social justice agenda. Our generation will be judged by how we succeed on this front.

Photo: Iceland Monitor/ Eggert Jóhannesson

This piece was first published on the Wellbeing Economies film blog

Since early 2018, we have spent a lot of time with our protagonist Katherine Trebeck. In the summer of last year, we also traveled to Costa Rica together, to film her while she was speaking at a conference about sustainable fashion, and while she met the Costa Rican First Lady.

On that trip, she told us about an idea that I forgot about later, and that I was again reminded of recently. It is a beautiful thought that very convincingly illustrates how much we must change our notion of what progress actually means.

You have a very tough challenge to overcome when you try to move away from an economy that is measured by the “growth” it produces, in terms of financially measurable output. Or, in other words, by how much it increases GDP every year. GDP is such an established measurement: Everyone has heard of it, it seems so incredibly familiar (even though most people have no idea what it really is), and that’s why people have a really hard time letting go of it.

Now, how does the growth of GDP tell us that a society is improving?

Well, it measures how much a society makes every year, in terms of how much money is being spent on things in that society. And then it assumes that we are doing better if more things are made and sold next year. And so on. Forever. More stuff is better. It’s as simple as that.

We are now finding out that more is not better. Up to a certain point, yes. But after that, more just hurts more: It hurts nature. It hurts equality in society. It hurts the psychological health in a population. It hurts the climate. Etc.

In the western world, and after we’d broken everything in World War II (“thanks” to the nation I come from, Germany), looking at the GDP was probably a good idea, for a while. We could simply count how much we are making and then assume that we’re doing better if we are producing more next year. It meant more people in jobs, more people could afford things, life was getting better. But those days are gone. We are no longer better off if the GDP keeps growing, we’re actually worse off, nowadays. And we’re clearly ruining the planet this way.

So we speak a lot about what might be a better measure. There’s not going to be a single thing that replaces GDP, of course. But if you ask Katherine which single measure she would pick if she could use only one, to analyse if a society is actually doing better year after year, she’ll say this:

‘Why not get countries to measure the number of girls who bicycle to school?’

Ok, this may seem very strange at first glance. What? Rather than looking at how much economic output our country is producing, let’s count girls on bikes?

Think about it. It makes a heap of sense:

If more and more girls ride a bike to school, it means it’s safer and safer to cycle in traffic.

If more and more girls ride bikes to school, it means that bikes are increasinly accepted as a means of transport. And it means less parents’ cars — who are now doing the “parent taxi” thing (a big issue here in Germany) — are polluting the air and creating dangerous traffic jams outside schools.

If more and more girls cycle to school, it means that more and more girls are actually going to school and getting an education, period. That’s an important achievement in many countries.

If more girls are cycling to school, it means that they’ll get used to this mode of transport, it will translate to better health for them in the future, and to less pollution in society in the future.

If more girls go to school on bikes, it means that they are not afraid to be attacked by predators who do them harm.

If more and more girls ride bikes to school, more and more boys will do that, too.

If more and more girls cycle to school, it means that more of them are empowered and unafraid.

I think I agree with Katherine: This is an incredibly convincing measure of progress. And one that deserves serious consideration as a replacement for GDP. And I am not joking one bit.

This was first published on Open Democracy

Ian Gough’s latest book is required reading for anyone who wants to understand the enormity of the task at hand, writes Katherine Trebeck.

This is a long overdue review of a book that could not be more important. I read Gough’s Heat, Greed and Human Need: Climate Change, Capitalism and Sustainable Wellbeing soon after it was published, and I have taken my time to digest and reflect on its messages. Since then, the book’s messages have only become more salient, as young people have gone on strike from school to call out political intransigence to the climate crisis, as scientists’ warnings have become more stern and their connection of the climate crisis with the operation of the economic system less tentative, and as the UN Special Rapporteur has exposed the UK government’s inadequate support (at best) for people failed by the economic system.

This book is rich – and dense. It is not a page turner, but a ‘page-returner’. I found myself leafing back to re-read sections in order to grasp subsequent discussions. But the research and reflections contained between the covers provide the intellectual foundation for the protest placard ‘System Change Not Climate Change’.

Gough is one of the world’s greatest scholars on human needs (he explains his intellectual journey in a short autobiography). His work, with Len Doyal, shows that basic needs encompass physical health, autonomy of agency (mental health, cognitive understanding, opportunities to participate), and critical autonomy. They are satisfied by access to things such as adequate food and water, protective housing, safe work environment, healthcare, and significant primary relationships, and in turn optimized by freedoms from (civic and political rights), freedoms to(rights of access to need satisfiers), and political participation.

Since human need theory draws on eudemonic psychology (which underscores the recognition of three universal needs: autonomy, competence and relatedness), Gough’s work is influential for those who are a little skeptical about the merit of wellbeing as individual self-reported happiness in the hedonic sense. He reminds us, for example, that preferences and wants are shaped and context matters, so simplistic assumptions about one number or one question about how people feel are problematic. In contrast, “human needs are objective, plural, non-substitutable and satiable”.

Heat, Greed, and Human Need takes this focus and puts the attainment of human needs in the context of the climate crisis, given the scientific realities and lived experience faced by communities around the word. He does so by explaining how both rising heat (due to climate change) and resultant challenges in meeting human needs have their root cause in the greed embedded in – and exacerbated by – the current economic system: ‘neoliberalism’. This is an economic agenda characterized by belief in the superiority of markets (especially when spread across global production networks, and when the financial sector flourishes) and a disparaging approach to the role of government and collective action.

The pursuit of economic growth, which is inherent in this system, has been “at the cost of growing inequalities of wealth and income…Another way that growth undermines wellbeing is through the commodification of more and more aspects of life”.

In other words, while human needs theory tells us that everyone has psychological needs for autonomy, competence and relatedness, “economic growth often fails to nurture and nourish” these needs.

Worse, when the climate crisis is taken into account, Gough reports that research and modelling show increasing the efficiency of production won’t be enough – unfortunately for proponents of a ‘technical’ solution,

Instead, the task is to change the pattern of consumption and ensure that what the ‘North’ consumes is within a corridor of minimum and maximum standards. This requires fundamental transformation of almost all aspects of the economy, including a need to:

  • Invest in renewable energy and energy networks
  • Transform and communications and even cities
  • Retrofit buildings for energy efficiency
  • Regenerate natural resources generated
  • Re-examine ideas of investment, productivity, profit and growth to align with social needs and contribution

He suggests that there are three-elements of the shift: improving production to make it more efficient in resource and energy use; transforming consumption so it encompasses less material throughput; and reducing demand for consumption in the global north. These elements are set out in turn and their possibility aided by a rich discussion of the different ‘varieties’ of capitalism as it intersects with welfare states, climate mitigation strategies – including some great typologies (always useful for a reader like me who loves a good typology!).

Gough does not shy away from pointing to the extent of political capture that drives the current mode of greed-driven capitalism, nor does he hesitate in raising a skeptical eyebrow at policies currently in vogue amongst potential readers.

On the former, he notes that the financial sector in countries such as the UK and the US has expanded due to its lobbying power, influence on governments, and ‘ability to shift investment and economic activity between jurisdictions and the structural position of finance capital in ensuring national economic survival’.

On the later, in the face of the growing embrace of the citizens basic income agenda, Gough is cautious saying: the “idea of a citizen’s income resembles a ‘silver bullet’…[but it] could distract attention from the complex underlying causes of inequalities, ill-health and social conflict…These require ‘upstream’ systemic changes, rather than a single downstream intervention”.

This frankness and the positioning of human need delivery in the context of a planet burning up before our eyes make this rich book required reading for anyone who wants to break out of siloed thinking, who wants to understand the enormity of the task at hand, and who wants to be reminded of what the purpose of the economy should ultimately be.

WEAll’s Katherine Trebeck and her co-author Jeremy Williams have been blogging about the core themes of their book ‘The Economics of Arrival: ideas for a grown up economy’.

Published on Jeremy’s site ‘The Earthbound Report’, the blogs explore the following five themes (click to read the blogs on Earthbound Report, or view the first one in full below):

  1. What is Arrival?
  2. On making ourselves at home
  3. The futility of uneconomic growth
  4. What does progress look like after growth?
  5. A gentler path to the summit
What is Arrival?

Arrival is the idea that sparked our book and gives it its title: The Economics of Arrival: Ideas for a Grown Up Economy. But what do we mean by it? What is arrival?

(Besides being a rather good sci-fi film that came out while we were writing the book and drank our Google juice, obviously.)

Arrival is the notion that development has a destination. Growth is a means to an end, and at some point its work is done.

Arrival is about having enough to, in theory, have one’s basic needs met, and having all the resources required for a good life. To use a phrase that Jeremy’s grandma regularly said at the end of a good meal, we could describe it as reaching a point of ‘ample sufficiency’ in terms of wealth and resources in the economy as a whole.

In the context of national economies, a country has arrived if it has a high enough wealth and resources to theoretically provide a high quality of life for all its citizens. It has the finances and the materials to ensure everyone has what they need. Whether everyone has a good life in reality is, of course, a matter of access and distribution. Those are questions of politics and institutional design. Having enough resources collectively doesn’t necessarily mean everyone individually has enough. But it could, if a nation chose to make it so.

With that in mind, reaching a point of Arrival doesn’t mean that all problems are solved. We’re not suggesting that there’s a magical threshold where everyone’s needs are automatically provided for. But we can imagine Arrival as a moment when a society has the means for this. Growth has reached a point at which a good life could, theoretically, be universal.

Arrival is therefore a possibility, not a promise.

We’re using a journey metaphor, where rising economic growth and human development take us ever closer to our destination. You could, as in the sub-title of our book in fact, also consider Arrival to be a process of maturing and reaching adulthood, a metaphor captured in the German word for ‘postgrowth’, ausgewachsen. Or a tree reaching its full size, finding its niche among its neighbours, optimized to the rainfall, soil conditions and sunlight in the place where it stands.

This growth towards maturity is present all through nature. What if we extend the principle towards the economy? What does an economy look like when it is all grown up?

That does beg the question of how we know if and when a country has Arrived – and which of the world’s nations might already be there. It also raises the important question of what a country’s priorities should be once arrival is reached (and recognized). That’s something we call ‘making ourselves at home’, and we’ll look at that tomorrow.

Arrival is useful as a concept because it unlocks these kinds of questions. It’s a provocative notion, one that prompts us towards new lines of thinking. And those are positive questions – maturity is to be celebrated. Arrival is a success story. It delivers on the hopes of our ancestors, and promises a less stressful, more secure future for the next generation. But that would require us to recognize it and embrace it, or risk losing the gains so far in the scramble for more.

Let’s ask those questions, and see where they take us next. Welcome to the Arrivals Lounge.

Read the rest of the blogs at Earthbound Report

See also: Katherine and Jeremy’s recent blog ‘Arriving in a place with beautiful potential’ on And Beauty For All

Reposted from Junxion 

Capitalism is suffering from a crisis of legitimacy and nowhere is that truer than in the banking sector. Following the 2007/8 crash, banks have focused on compliance and getting their house in order, but they have broadly failed to win back the trust they lost.

Working together in a process convened by the UN Environment Finance Initiative (UNEP FI), a group of 30 banks have developed the Principles for Responsible Banking—a framework for all banks to show that they understand their purpose is to serve and contribute to meeting society’s needs and individuals’ goals. Following a six-month global consultation, the final version of the Principles and supporting documents were released this week (July 25, 2019). The Principles will be opened for signature on 22 September 2019 at the UN General Assembly.

To cite r3.0—the multi-stakeholder platform that promotes Redesign for Resilience and Regeneration of which Junxion is an Advocation Partner—it’s the kind of ‘radical collaboration’ needed for system change. The Principles for Responsible Banking aim to create nothing less than the sustainable banking system of the future.

Who’s involved?

The 30 founding banks come from around the globe and include China’s ICBC—the world’s largest bank—BNP Paribas, Barclays, Citi, National Australia Bank, BBVA and South Africa’s Land Bank. A further 40-plus banks have committed to becoming signatories and these include Standard Chartered, ABN-AMRO and Amalgamated Bank from the US.

There are also a number of non-bank endorsers of the Principles—banking organizations such as the European Banking Association and the World Savings Bank Institute as well as specialist service providers such as Datamaran and responsible investment advocates such as ShareAction.

What are the Principles for Responsible Banking?

The Principles for Responsible Banking are a framework for all banks to show that they understand their purpose is to serve and contribute to meeting society’s needs and individuals’ goals.

The six principles signatory banks commit to are:

  1. Alignment We will align our business strategy to be consistent with and contribute to individuals’ needs and society’s goals, as expressed in the Sustainable Development Goals, the Paris Climate Agreement and relevant national and regional frameworks.
  2. Impact & Target Setting We will continuously increase our positive impacts while reducing the negative impacts on, and managing the risks to, people and environment resulting from our activities, products and services. To this end, we will set and publish targets where we can have the most significant impacts.
  3. Clients & Customers We will work responsibly with our clients and our customers to encourage sustainable practices and enable economic activities that create shared prosperity for current and future generations.
  4. Stakeholders We will proactively and responsibly consult, engage and partner with relevant stakeholders to achieve society’s goals.
  5. Governance & Culture We will implement our commitment to these Principles through effective governance and a culture of responsible banking.
  6. Transparency & Accountability We will periodically review our individual and collective implementation of these Principles and be transparent about and accountable for our positive and negative impacts and our contribution to society’s goals
How will banks implement the Principles?

Within four years of signing the Principles banks must fully implement the three key steps of analyzing positive and negative impacts, target setting and implementation, and reporting on progress.

The impact analysis has to ‘identify the most significant (potential) positive and negative impacts on the societies, economies and environments where it operates’ and identify the business opportunities to increase the positive and decrease the negative ones.

Secondly, banks have to set two or more targets covering at least two of the priority impact areas. These targets have to be SMART (specific, measurable, achievable, relevant and time-bound). Banks have to begin taking steps to meet the targets, including establishing a governance and oversight structure to monitor progress.

Thirdly, banks have to publish their impact analysis and report their progress in implementing the Principles and meeting their targets, and this self-assessment has to be subject to limited assurance.

So what?

A responsible business professional might say this is sustainability 101 for banks: Set a vision, improve performance with the help of some targets, engage with all the people that matter in the shape of your customers and stakeholders, look at how you make decisions and your company culture and report on progress.

But it’s not just any old vision that the banks can set for themselves: it’s a vision of what the world needs. The draft Implementation guidance for Principle 1 talks about ‘creating consistency between the bank’s value creation model and the SDGs and the Paris Climate Agreement …’. This is big: the Principles are normative, explicitly calling on banks to work towards how the world should be.

It’s not just any old vision that the banks can set for themselves: it’s a vision of what the world needs.

And this theme is continued in Principle 2 about measuring impact and setting targets. On the face of it, that looks like any sound sustainability programme. But those targets have to meet or exceed the targets in the SDGs and the Paris Climate Agreement. Again, signatories have to contribute explicitly to what society needs.

And if those targets are judged to be failing to address that bank’s most significant targets or are not in line with the ambitions in the SDGs and Paris, then that bank can be removed from the signatory list. So, the Principles have teeth.

Will the Principles achieve any real change?

There are definitely reasons to be cheerful. The Principles elevate sustainability to the strategic level—this is more than some risk analysis on an individual transaction or an ESG (environmental, social and governance) screen on a particular portfolio. The Principles are saying society’s goals have to form an integral part of banks’ own strategic objectives.

And they are deliberately designed so banks can ‘start where they are’. No matter their starting point or context, developed or developing country, banks can get on board so the Principles create a framework for the global banking industry.

A key determinant of how much progress banks will make to delivering on the promise of the Principles lies  in the interpretation of ‘alignment’—a question that was raised In the public consultation that just closed. The official answer is that ‘Alignment requires that a bank’s business strategy is consistent with and geared towards making a positive contribution to the SDGs, the Paris Climate Agreement and relevant national or regional frameworks, where a bank is best positioned to do so through its business.’

This is clearly designed to leave space for individual banks to make their own judgement. But James Vaccaro, director of strategy at the ethical Triodos Bank, one of the founding banks that led the development of the Principles, is confident that the Principles are well designed to achieve change across the banking system:

“We have our ‘light on the hill’ in the shape of the SDGs and Paris and we have that ‘ramp effect’ where companies make progress as they individually go through their iterations of analysis, engagement and implementation. But crucially there is sharing between the individual signatory institutions as well. And that means you will have a race to the top, which creates the right conditions for non-linear change and the potential for the banking industry to take some really big steps towards the world we want.”

What’s the big opportunity here?

This is much more than a voluntary industry initiative that banks glibly sign up to, warns Madeleine Ronquest, Head of Environment, Social and Climate Risk at South Africa-based FirstRand Bank—also a founding bank of the Principles:

“We want to properly apply our minds so that the process and the information we publish will stand up to scrutiny. And there is a lot of groundwork that needs to be done in advance, engaging critical stakeholders, internally and publicly, spending as much time as may be required and being as inclusive as possible. The Principles are very aspirational and very ambitious and that was the intention in developing them. Signing them represents a serious commitment.”

The real opportunity of the Principles is to convince a sceptical world that businesses can and will collaborate for the common good.

So, they are not going to be easy to implement—but we all know they are necessary. The Principles represent an outstanding opportunity for the banking industry to do the right thing. To demonstrate that they are serious about backing up their social purpose statements with real impact that ‘achieves shared prosperity for both current and future generations’, as the Principles’ mission statement says.

And given the crucial role that finance plays in society’s collective efforts to create a better future, there is a lot riding on how banks step up here. It’s more than securing their own legitimacy and creating the sustainable banking system of the future, it’s about financing the change we need to see in the world.

Even more than that, we need these industry initiatives—these ‘meso-level’ activities in r3.0 parlance – to succeed and society has to see that they do. The real opportunity of the Principles is to convince a sceptical world that businesses can and will collaborate for the common good.

It’s what we at Junxion call being ‘audacious, together’. It is leadership.

 

Adam Garfunkel is an owner and Managing Director at Junxion. For more than 20 years, he’s been involved in corporate sustainability initiatives and led the team that created the communications strategy for the Principles for Responsible Banking.

This is the first in a series of guest blogs, exploring a range of new ideas for how we can move forward and create a future economy with human and environmental wellbeing at its heart. These blogs reflect the opinions of their authors, not necessarily WEAll and its members. What do you think of Angus’ idea? Comment below!

By Angus Forbes

“Two extraordinary things have just happened to the human race. The first is the understanding that we now run, along with Mother Nature, the life-support system of our planet. This is tantamount to a second Copernican revolution. The second is that we have now formed into a connected global citizenship.

From this point on, the future of both Earth and us humans is inextricably linked due to our size and power. So, we now have part responsibility for the planet’s ability to sustain life as we know it. We, yes, us humans, have to decide what the biophysical integrity of this planet will be in 2120, 3020, 4020 and thereafter.

We created our 200 countries though numerous acts of national self-determination when the global population was, on average, just under two billion (1924). Now we number just under eight billion people, we are urban, we are powerful and things have changed.

We now have a global problem that clearly cannot be handled by the system of independent countries and their multilateral organizations that we have created. For in the 50 years since the 1972 UN Stockholm Declaration which stated that the natural assets of Earth must be safeguarded, we have witnessed the accelerating destruction of our most valuable global asset, the biosphere. So something is structurally very wrong.

I believe the blame for the current predicament lies squarely with us, that is, you and me, because we have not created the right governance tool for our times, the risk we face and the known future. The nation state system we built was never designed to protect a biosphere from attack by 8 billion of us.

I am absolutely convinced that in order to protect the biosphere, we need a specialist global authority to do the job. We need to give it powers of regulation and revenue collection over all human organizational form (including the nation state) sufficient to impose the necessary biophysical boundaries for us all. Our new specialist authority will make decisions based on time frames different from those used by any existing human organization, i.e. 100, 500 and 1,000 years.

I believe that humanity is just about to embark upon our first act of global self-determination and enter the current void in global governance to create this authority. In 2022, 32 years after Sir Tim Berners-Lee wrote the computer program HTML and gave us the World Wide Web, five billion of us will be connected to each other via the internet. Five billion global citizens who are only seconds apart.

Because we know the problem and we are now connected, we have in place the two preconditions for positive radical change. We are in fact 80% of the way to forming the Global Planet Authority. We have no one to ask except ourselves in order to take the last step, to vote the GPA into existence.

It will involve hard work and sacrifice in the short term, of that there is no doubt, but I believe that we are in fact desperate to live in a world of clear biophysical boundaries, to show that we can shoulder this, our greatest intergenerational responsibility. After all, we are all just humans and all part of the biosphere. As we damage it, we damage ourselves. If we restore and look after it, we restore and look after ourselves.

We must, and can, overcome our limitations by an evolutionary leap in governance. My book, ‘Global Planet Authority: How we are about to save the biosphere’, is available to order now. “