Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.
WHY? HOW? WHAT?
TRUE VALUE ACCOUNTING
File: TVA-p3-00-WHY-HOW-WHAT-160111.odp Peter Burgess (c) All rights reserved
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
ena...
WHY?
People, society, governments, companies, and investors need
to make better decisions in order to avoid existential th...
WHY?
People, society, governments, companies, and
investors need to make better decisions in
order to avoid existential th...
There is a huge amount of dysfunction in the
modern SOCIO-ENVIRO-ECONOMIC system.
Some people … relatively few … do very w...
There is an assumption that the pursuit of
profit results in better outcomes, but this is not
so in our modern SOCIO-ENVIR...
There are existential social risks when there is
massive inequality between the 'haves' and the
'have-nots'.
This risk is ...
There are existential environmental risks when
the functioning of man built processes means
that the environment is degrad...
The science is clear, but there is no way to
communicate the scale of these existential
threats with the SOCIO-ENVIRO-ECON...
We are on a trajectory to disaster, and this
must be changed.
TRUE VALUE ACCOUNTING
HOW?
You manage what you measure! Therefore
measure everything that matters and make
measures accessible to everyone!
TRUE...
TRUE VALUE ACCOUNTING
Peter Drucker, a well known
management guru famously said:
“You can't manage
what you don't measure”
Therefore measure everything that matters and
make measures accessible to everyone!
TRUE VALUE ACCOUNTING
The core PURPOSE of human activity is to
enable a decent standard of living and quality
of life for the people in society....
PEOPLE are at the center of everything.
Change the behavior of people, and everything
else will change.
TRUE VALUE ACCOUNT...
PEOPLE have been indoctrinated for a very
long time that MORE IS BETTER, and in a
shortage economy, that is usually true.
...
COMPANIES embrace the doctrine of MORE IS
BETTER in large part because more sales
usually translates into MORE PROFIT.
MOR...
But more company activity and more product
flows also results in more NEGATIVE IMPACT
on the environment and more existent...
And to the extent that better productivity
makes it possible for companies to produce
more product and make more profit wi...
ALL of these issues need to be quantified and
measured.
TRUE VALUE ACCOUNTING
Many of the measures are already in place, but
they are not yet being used in an effective way.
Mostly the measures are to...
Many initiatives are going forward to collect
more useful data, and make better models of
the workings of the socio-enviro...
WHAT?
True Value Accounting (TVA) is not only about
the rigorous accounting for money but also the
impact economic activit...
Conventional double entry accounting is very
powerful and is at the center of every corporate
management information syste...
The same systems enable drill down to a lot of
detail about specific parts of the organization
to facilitate analysis of p...
The weakness of conventional accounting is
that it has a focus only on the performance of a
reporting entity, usually a bu...
True Value Accounting (TVA) builds on the
foundational constructs of conventional double
entry accounting so that the impa...
Conventional financial accounting links to cost
accounting and standard costs. True Value
Accounting (TVA) links also to s...
TVA considers impact from many dimensions:
● The money dimension that is used to measure wealth,
income and profit;
● The ...
Also many perspectives:
● The company … both profit AND the impact on people
and planet.
● People … the products and servi...
The same data looked at from different
perspectives tells many stories … not just a
single one. This is vital for the deci...
True Value Accounting also addresses the
matter of risk. Many issues that have been
unimportant in the past are now of hug...
True Value Accounting aims to make decision
making data available to everyone in a relevant
format:
● Senior policy makers...
True Value Accounting makes it possible to
measure progress and performance no matter
how the system is structured, where ...
CONCLUDING THOUGHT
Many initiatives are going forward to improve
acccess to key data. True Value Accounting
(TVA) compleme...
REMINDER
This slideset is A WORK-IN-PROGRESS. It will be
upgraded periodically. It is part of a series of more than
100 sl...
THANK YOU
Some links and contact information:
Email Peter Burgess … peterbnyc@gmail.com
Peter Burgess LinkedIn profile
htt...
Upcoming SlideShare
Loading in …5
×

TVA p3 00 WHY? HOW? WHAT? 160111

299 views

Published on

WHY, HOW, WHAT for TrueValueMetrics and True Value Accounting (TVA) summarizes the journey that is resulting in the development of this metrics system. Peter Drucker famously said, you manage what you measure, but it is also critical to measure the right things and do it in the right way. The best management information is quick, low cost, and good enough to get good decision made most of the time.

Published in: Economy & Finance
  • Be the first to comment

  • Be the first to like this

TVA p3 00 WHY? HOW? WHAT? 160111

  1. 1. WHY? HOW? WHAT? TRUE VALUE ACCOUNTING File: TVA-p3-00-WHY-HOW-WHAT-160111.odp Peter Burgess (c) All rights reserved
  2. 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 enable better metrics for the complex socio-enviro-economic system that we all live in. Metrics are powerful, but they must be the right metrics. TRUE VALUE ACCOUNTING
  3. 3. WHY? People, society, governments, companies, and investors need to make better decisions in order to avoid existential threats to life as we know it! HOW? You manage what you measure! Therefore measure everything that matters and make measures accessible to everyone! WHAT? True Value Accounting (TVA) is not only about the rigorous accounting for money but also the impact economic activity has on people and society and the impact there is on the planet and the environment. TRUE VALUE ACCOUNTING
  4. 4. WHY? People, society, governments, companies, and investors need to make better decisions in order to avoid existential threats to life as we know it! TRUE VALUE ACCOUNTING
  5. 5. There is a huge amount of dysfunction in the modern SOCIO-ENVIRO-ECONOMIC system. Some people … relatively few … do very well but most people have to struggle. Many people are living in poverty and in societies that are broken. TRUE VALUE ACCOUNTING
  6. 6. There is an assumption that the pursuit of profit results in better outcomes, but this is not so in our modern SOCIO-ENVIRO-ECONOMIC system. The profit measure within an organization ignores externalities that are now more important for the future of humanity than anything else. TRUE VALUE ACCOUNTING
  7. 7. There are existential social risks when there is massive inequality between the 'haves' and the 'have-nots'. This risk is aggravated when technology makes powerful instruments of war (and modern mayhem) easily available and relatively low cost. TRUE VALUE ACCOUNTING
  8. 8. There are existential environmental risks when the functioning of man built processes means that the environment is degraded to such an extent that natural systems are put at risk of collapse. Environmental stability that has been maintained for 10,000 years now has the potential to change in the next 100 years with consequences that are hard to imagine. TRUE VALUE ACCOUNTING
  9. 9. The science is clear, but there is no way to communicate the scale of these existential threats with the SOCIO-ENVIRO-ECONOMIC management systems currently being used. TRUE VALUE ACCOUNTING
  10. 10. We are on a trajectory to disaster, and this must be changed. TRUE VALUE ACCOUNTING
  11. 11. HOW? You manage what you measure! Therefore measure everything that matters and make measures accessible to everyone! TRUE VALUE ACCOUNTING
  12. 12. TRUE VALUE ACCOUNTING Peter Drucker, a well known management guru famously said: “You can't manage what you don't measure”
  13. 13. Therefore measure everything that matters and make measures accessible to everyone! TRUE VALUE ACCOUNTING
  14. 14. The core PURPOSE of human activity is to enable a decent standard of living and quality of life for the people in society. This starts with 'me' and my family … and ripples outwards to everyone. TRUE VALUE ACCOUNTING
  15. 15. PEOPLE are at the center of everything. Change the behavior of people, and everything else will change. TRUE VALUE ACCOUNTING
  16. 16. PEOPLE have been indoctrinated for a very long time that MORE IS BETTER, and in a shortage economy, that is usually true. Where there is an abundance of PRODUCT, then the best outcomes are when the right amount is consumed, not the most. TRUE VALUE ACCOUNTING
  17. 17. COMPANIES embrace the doctrine of MORE IS BETTER in large part because more sales usually translates into MORE PROFIT. MORE PROFIT in turn translates into a higher stock valuation for the company, and more WEALTH for INVESTORS. TRUE VALUE ACCOUNTING
  18. 18. But more company activity and more product flows also results in more NEGATIVE IMPACT on the environment and more existential risk for the system. TRUE VALUE ACCOUNTING
  19. 19. And to the extent that better productivity makes it possible for companies to produce more product and make more profit with less labor, the existential risk of social unrest is going to grow. TRUE VALUE ACCOUNTING
  20. 20. ALL of these issues need to be quantified and measured. TRUE VALUE ACCOUNTING
  21. 21. Many of the measures are already in place, but they are not yet being used in an effective way. Mostly the measures are too 'technical' for easy use, requiring specialized knowledge that is not easy to acquire. TRUE VALUE ACCOUNTING
  22. 22. Many initiatives are going forward to collect more useful data, and make better models of the workings of the socio-enviro-economic system … but in general they all fail to enable everyone and every organization to make better decisions that will improve quality of life while reducing existential threats for the future. TRUE VALUE ACCOUNTING
  23. 23. WHAT? True Value Accounting (TVA) is not only about the rigorous accounting for money but also the impact economic activity has on people and society and the impact there is on the planet and the environment. TRUE VALUE ACCOUNTING
  24. 24. Conventional double entry accounting is very powerful and is at the center of every corporate management information system. It enables the progress and performance of very large and complex organizations to be reported in a brief set of financial statements. TRUE VALUE ACCOUNTING
  25. 25. The same systems enable drill down to a lot of detail about specific parts of the organization to facilitate analysis of performance, and action to get performance improvement. TRUE VALUE ACCOUNTING
  26. 26. The weakness of conventional accounting is that it has a focus only on the performance of a reporting entity, usually a business entity, and is only about impact on the performance of the entity ignoring everything that is external to the reporting entity … external to the 'reporting envelope'! TRUE VALUE ACCOUNTING
  27. 27. True Value Accounting (TVA) builds on the foundational constructs of conventional double entry accounting so that the impact on society and the impact on the environment are brought into account with the same rigor that applies to money transactions. TRUE VALUE ACCOUNTING
  28. 28. Conventional financial accounting links to cost accounting and standard costs. True Value Accounting (TVA) links also to standard values. TRUE VALUE ACCOUNTING
  29. 29. TVA considers impact from many dimensions: ● The money dimension that is used to measure wealth, income and profit; ● The human and social dimension that measures quality of life and standard of living; ● The environmental dimension that relates to everything that is in nature, including the the natural cycles that impact climate change. TRUE VALUE ACCOUNTING
  30. 30. Also many perspectives: ● The company … both profit AND the impact on people and planet. ● People … the products and services that they use to support their quality of life, and the impact these products and services have on the environment ● Products … that flow through the system ● Processes … that are used to transform resources into products. ● Places … where everything is located and where people live their lives TRUE VALUE ACCOUNTING
  31. 31. The same data looked at from different perspectives tells many stories … not just a single one. This is vital for the decision making that we all need to have a better world. TRUE VALUE ACCOUNTING
  32. 32. True Value Accounting also addresses the matter of risk. Many issues that have been unimportant in the past are now of huge importance … and growing. Climate change poses an existential threat that could result in mass extinction of species on a scale not seen for 10,000 years. Sea level rise caused by climate change means huge populations will be at risk … as many as one billion people will be flooded out. TRUE VALUE ACCOUNTING
  33. 33. True Value Accounting aims to make decision making data available to everyone in a relevant format: ● Senior policy makers at the national level; ● Investors; ● Corporate decision makers; ● Sub national regional decision makers; ● City leaders; ● Individuals and families. TRUE VALUE ACCOUNTING
  34. 34. True Value Accounting makes it possible to measure progress and performance no matter how the system is structured, where progress and performance are about money AND impact on people AND impact on the environment … AND the existential risks in the future are taken into consideration! TRUE VALUE ACCOUNTING
  35. 35. CONCLUDING THOUGHT Many initiatives are going forward to improve acccess to key data. True Value Accounting (TVA) complements many of these initiatives. More detail about TVA are available on the TrueValueMetrics website. TRUE VALUE ACCOUNTING
  36. 36. 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: http://www.truevaluemetrics.org/DBadmin/DBtxt001.php?vv1=N1-Slidesets-p3 More about the True Value Metrics initiative is at: http://www.truevaluemetrics.org/DBadmin/DBtxt001.php?vv1=list0100-MainNav 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) or webpage involved. TRUE VALUE ACCOUNTING
  37. 37. 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

×