Accounting

We are counting and measuring things all the time. We invented money as a way to account for various forms of wealth. You need to measure your body to know what size of clothes to buy. When you shop for food, almost everything is sold by number, weight or volume. Accounts are a systematic way of keeping track of many things. So accounting is the process of choosing an indicator to measure, performing the measurements, organising them in a system of accounts, and using that system to hold ourselves and others to account for the performance of whatever we chose to measure.

Science uses many forms of measurement. Economists generally use money as the measure of value, and convert everything into monetary terms. This can be a problem for the many things that cannot be easily monetised, like human well-being.

When it came to measuring the performance of a national economy, economists developed a complex measure of how money flows through the economy, referred to as gross national product (GNP) or gross domestic product (GDP). This is used to report on how the economy has grown over time, and to make comparisons between national economies. Endless growth in GDP is considered highly desirable and politically essential. GDP per capita also measures how much national wealth there is per person. Of course it says nothing about how that wealth is distributed within the country. Another problem is that the flow of money through an economy has no relationship to whether that benefits people. Auto accidents are good for GDP through the cost of treating the injured and repairing or replacing vehicles. GDP also ignores things not measured in money. Paid employment is counted, but not subsistence agriculture or mothers raising children. Human happiness is counted when from paid entertainment, but not when walking in a forest or park. The value of a forest counts when it is logged, but not when it is sequestering carbon and preserving biodiversity. To measure human well-being and sustainability, we need other measures and accounting.

WHY BEYOND GDP

While GDP still dominates economic thinking and political priorities, many have been exploring alternatives beyond GDP. The UN Secretary-General himself has supported these efforts.

...now is the time to correct a glaring blind spot in how we measure economic prosperity and progress. When profits come at the expense of people and our planet, we are left with an incomplete picture of the true cost of economic growth. As currently measured, gross domestic product (GDP) fails to capture the human and environmental destruction of some business activities. I call for new measures to complement GDP, so that people can gain a full understanding of the impacts of business activities and how we can and must do better to support people and our planet.
(UN Secretary-General, 2021, Our Common Agenda, Summary, https://www.un.org/en/content/common-agenda-report/summary.shtml)

For work by the UN system, governments and civil society to develop such measures, see BEYOND GDP EXAMPLES.

VALUES-BASED MEASURES

Complex systems science shows that changing a system like our global economy is not easy, but the best leverage points for system change are to replace the existing materialistic paradigm, or even better to change the values underlying the system. Since the IEF has always focussed on ethics and values derived from a Bahá'í perspective on the needs of society today, it has long contributed to research on and discourse in values-based measures and indicators for social transformation.

For example, its members collaborated in an EU-funded research project at the University of Brighton in the UK on values-based indicators of education for sustainable development. Its 14th Annual Conference in 2010 was held at the University of Brighton on the theme "Making the Invisible Visible: An Emerging Community of Practice in Indicators, Sustainability and Values". Among many other things, the project produced three toolkits of values-based indicators of sustainability education for secondary schools.

IEF AND NEW MEASURES

In 2021-2023, as an alternative to GDP, IEF and ebbf-Ethical Business Building the Future ran a project to imagine a way to measure material, social and spiritual well-being without using monetary measures as was current in the economy. This became Global Solidarity Accounting with nine dimensions: three environmental, 1. carbon (energy), 2. biodiversity, and 3. pollution; three for human well-being, 4. minimum living standard (poverty), 5. food, and 6. health; and three social, 7. work and service, 8. knowledge and education, and 9. spiritual capital and values.

NEWS AND POSTS

Beyond GDP, IISD, 4 March 2025

Reflections on Information, blog by Arthur Dahl, 16 January 2025

Is our Vision of Progress Really Progress?, Daniel Perell, Bahá’í International Community, 6 January 2025

Lessons learned from the Global Solidarity Accounting project, 24 July 2023

Complements to GDP: What Values Guide Development?, Baha'i International Community, 15 June 2023

Valuing What Counts: Framework to Progress Beyond GDP, UN Secretary-General, Our Common Agenda Policy Brief no. 4, May 2023

Social Change toward Universal Solidarity with a System of Accountability, Christine Muller, 2 June 2023

Accountability, 16 April 2023

Global Solidarity Accounting for Business, ebbf - Ethical Business Building the Future, Annual Conference 18-21 May 2023

Beyond GDP examples, 18 August 2023

Global Solidarity Accounting Progress, 26 January 2023

Community Conversations for Global Solidarity, 18 August 2022

Global Solidarity Accounting, Arthur Dahl, Version 8 22 July 2022

Introduction to Global Systems Accounting, 4 May 2022

Launch of Global Systems Accounting, 30 April 2022

Co-Designing a New and Better Global Systems Accounting for Pollution, working webinar 19 February 2022

Well-being in Vanuatu, Vanuatu National Statistics Office, July 2021

Ecosystem Accounting Takes Off, 3 March 2021

Reweaving the Ecological Mat, Report of a Pacific Islands Indigenous webinar, 4 February 2021, by Arthur Dahl

Inclusive Development and its Spiritual Indicators, Arthur Dahl at International Conference on Education for Social Cohesion, IEF 24th Conference, 11-12 July 2020

Unity: Indicator of True Success, Arthur Dahl for ebbf International Conference, 14-17 May 2020

WEF Global Risks Report 2020, 15 January 2020

The many dimensions of poverty, UNDP Multidimensional Poverty Index, September 2019

Indicators for the Sustainable Development Goals, UN Statistical Commission, 11 March 2016

World Happiness Report 2015, April 2015

IEF comments on Indicators for the Sustainable Development Goals, April 2015

Indicators for the Sustainable Development Goals, comments by IEF, January 2015