Society needs better metrics because the complex modern global socio-enviro-economic system is not achieving sustainable results. The data are clear that the singular focus on profit for the corporation and wealth for owners is not giving a good result for most people nor the environment. Better metrics will be a start to solving this problem of systemic dysfunction. The system is complex. There is no perfect answer, but it is possible to achieve a better world by getting a large number of people to make better decisions. A starting point for that is better metrics. system is complex. There is no perfect answer, but it is possible to achieve a better world by getting a large number of people to make better decisions. A starting point for that is better metrics, and, as Peter Drucker famously said, you manage what you measure!

1. WHY SOCIETY NEEDS
BETTER METRICS
File: MDIA-p3-01-1-WHY-151005.odp Peter Burgess (c) All rights reserved
TRUE VALUE ACCOUNTING
TRUE VALUE ACCOUNTING

2. CONTEXT
This slideset is a Work-in-Progress
and will be updated from time to time.
It is part of a series that aims to
describe the extremely complex
socio-enviro-economic system that
we live in, and how this system can
be made to work better.
TRUE VALUE ACCOUNTING

3. The GOAL is to design and
deploy a system of metrics for
management that accounts for
impact on people and planet as
rigorously as double entry
accounting accounts for money
transactions that impact profit
MULTI DIMENSION IMPACT ACCOUNTING

4. Corporate profit performance
over the past fifty years has been
impressive …
MULTI DIMENSION IMPACT ACCOUNTING

5. GDP growth over the past 50
years very strong …
MULTI DIMENSION IMPACT ACCOUNTING

6. But labor income over the past
fifty years … not so good.
MULTI DIMENSION IMPACT ACCOUNTING

7. And environmental issues getting
worse … not better.
MULTI DIMENSION IMPACT ACCOUNTING

8. This is an unsustainable
trajectory for our complex global
socio-enviro-economic system
MULTI DIMENSION IMPACT ACCOUNTING

9. SOCIO … PEOPLE
ENVIRO … PLANET
ECONOMIC … MAN BUILT CAPITAL
MULTI DIMENSION IMPACT ACCOUNTING

10. MULTI DIMENSION IMPACT ACCOUNTING
Sun
BOP
Sun
Financial
Capital
Human
Capital
Man Built
Capital
Natural
Capital
Sun SunSun
Financial
Capital
Human
Capital
Man Built
Capital
Natural
Capital
Sun
EOPSOCIO - PEOPLE

11. MULTI DIMENSION IMPACT ACCOUNTING
Sun
BOP
Sun
Financial
Capital
Human
Capital
Man Built
Capital
Natural
Capital
Sun SunSun
Financial
Capital
Human
Capital
Man Built
Capital
Natural
Capital
Sun
EOPSOCIO - PEOPLE

12. MULTI DIMENSION IMPACT ACCOUNTING
Sun
BOP
Sun
Financial
Capital
Human
Capital
Man Built
Capital
Natural
Capital
Sun SunSun
Financial
Capital
Human
Capital
Man Built
Capital
Natural
Capital
Sun
EOPENVIRO - PLANET

13. MULTI DIMENSION IMPACT ACCOUNTING
Sun
BOP
Sun
Financial
Capital
Human
Capital
Man Built
Capital
Natural
Capital
Sun SunSun
Financial
Capital
Human
Capital
Man Built
Capital
Natural
Capital
Sun
EOPENVIRO - PLANET

14. MULTI DIMENSION IMPACT ACCOUNTING
Sun
BOP
Sun
Financial
Capital
Human
Capital
Man Built
Capital
Natural
Capital
Sun SunSun
Financial
Capital
Human
Capital
Man Built
Capital
Natural
Capital
Sun
EOPECONOMIC – MAN BUILT CAPITAL

15. MULTI DIMENSION IMPACT ACCOUNTING
Sun
BOP
Sun
Financial
Capital
Human
Capital
Man Built
Capital
Natural
Capital
Sun SunSun
Financial
Capital
Human
Capital
Man Built
Capital
Natural
Capital
Sun
EOPECONOMIC – MAN BUILT CAPITAL

16. The balance between PEOPLE,
PLANET and PROFIT is most
likely unsustainable …
MULTI DIMENSION IMPACT ACCOUNTING

17. The following slides reflect what
has happened over the past
millions of years …
MULTI DIMENSION IMPACT ACCOUNTING

18. YELLOW:
The PEOPLE piece … Human Capital (NC)
DIRTY BROWN:
The ECONOMIC piece … Man Built Capital (MBC)
GREEN:
NATURE, ENVIRONMENT … Natural Capital (NC)
MULTI DIMENSION IMPACT ACCOUNTING
COLOR KEY

19. MULTI DIMENSION IMPACT ACCOUNTING
Hum
an
Capital
Man
Built Capital
Natural Capital

20. MULTI DIMENSION IMPACT ACCOUNTING
Hum
an
Capital
Man
Built Capital
Natural Capital

21. MULTI DIMENSION IMPACT ACCOUNTING
Hum
an
Capital
Man
Built Capital
Natural Capital

22. MULTI DIMENSION IMPACT ACCOUNTING
Hum
an
Capital
Man
Built Capital
Natural Capital

23. MULTI DIMENSION IMPACT ACCOUNTING
Hum
an
Capital
Man
Built Capital
Natural Capital

24. MULTI DIMENSION IMPACT ACCOUNTING
Hum
an
Capital
Man
Built Capital
Natural Capital

25. Trajectory to disaster!
This must be changed
to this …
MULTI DIMENSION IMPACT ACCOUNTING

26. MULTI DIMENSION IMPACT ACCOUNTING
Hum
an
Capital
Man
Built Capital
Natural Capital

27. PEOPLE progressing
MBC* efficient
PLANET healthy
MULTI DIMENSION IMPACT ACCOUNTING
* Man Built Capital … Man Built Structures and Systems

28. For the past 50 years, using
conventional metrics, the system
has optimized for performance of
FINANCIAL CAPITAL but while
ignoring everything else ...
MULTI DIMENSION IMPACT ACCOUNTING

29. ECONOMIC GROWTH 1970 to 2011
CORPORATE PROFITS ...
GDP …
LABOR INCOME ...
MULTI DIMENSION IMPACT ACCOUNTING
3,600%
1,500%
1,100%

30. MULTI DIMENSION IMPACT ACCOUNTING

31. According to Federal Reserve data,
wages and salaries as a % of GDP
has declined steadily since 1970
MULTI DIMENSION IMPACT ACCOUNTING

32. MULTI DIMENSION IMPACT ACCOUNTING

33. In the 1950s and 1960s wages and
salaries were gaining moderately
while profits were declining. Since
the 1980s profits have increased
strongly while wages and salaries
have been decreasing as a share of
GDP.
MULTI DIMENSION IMPACT ACCOUNTING

34. MULTI DIMENSION IMPACT ACCOUNTING

35. Robert Reich … former Secretary
of Labor in the 1990s … shows pay
rose with productivity until 1969
and then it didn't ...
MULTI DIMENSION IMPACT ACCOUNTING

36. MULTI DIMENSION IMPACT ACCOUNTING

37. Since 1950 world PER CAPITA GDP
has grown more rapidly than at any
previous time ...
MULTI DIMENSION IMPACT ACCOUNTING

38. MULTI DIMENSION IMPACT ACCOUNTING

39. … but this is an average that does
not mean very much …
MULTI DIMENSION IMPACT ACCOUNTING

40. Rich countries and rich people
have increased their income and
wealth much more significantly
than poor countries and poor
people as these data for the USA
and the UK show ...
MULTI DIMENSION IMPACT ACCOUNTING

41. MULTI DIMENSION IMPACT ACCOUNTING

42. … but the metrics are not getting it
right …
MULTI DIMENSION IMPACT ACCOUNTING

43. The growth in GDP for the USA
over the period from 1945 to the
present has been phenomenal …
but the HAPPINESS of Americans
has deteriorated in this time.
MULTI DIMENSION IMPACT ACCOUNTING

44. Corporate money profit performance over
the past fifty years has been impressive
MULTI DIMENSION IMPACT ACCOUNTING

45. The growth in GDP also has a
strong correlation with increasing
stress on planetary resources and
the environment.
MULTI DIMENSION IMPACT ACCOUNTING

46. The growth in global population is
not as serious a problem as the
growth in GDP …
MULTI DIMENSION IMPACT ACCOUNTING

47. MULTI DIMENSION IMPACT ACCOUNTING

48. THE CHALLENGE …
MULTI DIMENSION IMPACT ACCOUNTING

49. There has been an amazing
improvement in productivity over
the past 40 years … and almost all
the benefits derived from the
increases in productivity have
accrued to owners.
MULTI DIMENSION IMPACT ACCOUNTING

50. This is what Business Schools
teach … and they do it very well.
MULTI DIMENSION IMPACT ACCOUNTING

51. In order for the socio-enviro-
economic system to be optimized
for people and planet and profit, an
improved system of metrics is an
absolutely essential prerequisite.
MULTI DIMENSION IMPACT ACCOUNTING

52. … and this is what Multi Dimension
Impact Accounting (MDIA) is all
about.
MULTI DIMENSION IMPACT ACCOUNTING

53. REMINDER
This slideset is A WORK-IN-PROGRESS. It will be
upgraded periodically. It is part of a series of more than
100 slidesets. Navigation to these is available here:
FEEDBACK is welcome. Please email to Peter Burgess …
peterbnyc@gmail.com … with a catchy phrase in the
subject line so that it gets attention, and please identify
the specific slideset(s) involved.
http://www.truevaluemetrics.org/DBadmin/DBtxt001.php?vv1=N1-Slidesets-p3
TRUE VALUE ACCOUNTING

54. THANK YOU
Some links and contact information:
Email Peter Burgess … peterbnyc@gmail.com
Peter Burgess LinkedIn profile
https://www.linkedin.com/in/peterburgess1
Link to TrueValueMetrics.org website
http://www.truevaluemetrics.org/
Link to navigation to other resources:
http://www.truevaluemetrics.org/DBadmin/DBtxt001.php?vv1=list0100-MainNav#1
TRUE VALUE ACCOUNTING