Markets - Social, Environmental and Economic

The triple bottom line is a great selling point for social enterprise.

The social and environmental value generated is what attracts so many people to the sector, both from the public sector, where they often feel constrained by a risk averse culture and from the private sector, where folk often feel used as a commodity to generate money. Even if they get well rewarded financially, many people from both sectors see the limits to material rewards, especially in a world where poverty still exists alongside obscene wealth, not to mention a world that is consuming finite resources at an unsustainable rate.

The corporate world has adopted the triple bottom line too.
The cynical might suggest that this is mostly about marketing.
Certainly, private and public companies have a primary duty to shareholders.
And most shareholders want the best financial return balanced against the risk of losing their stake.
Social and environmental value in this context are a long way behind economic value and mostly only considered inasmuch as they contribute to the primary bottom line.

Recognising this reality and aware that the survival of the planet is becoming critical, governments and others have created artificial markets, where environmental values are monetised.

This is the world of carbon trading. It may be spurious, it may even be cynically exploited by the rich and powerful, but it is an attempt to change behaviours in a way that does not depend on people acting morally, but recognises that most of the world is currently amoral and acts in a rather narrowly defined, self interested way.

Social reformers are missing a trick by focusing on the consciences and moral values of people. That is generally coped with by charity and legislation that mostly focus on ameliorating the symptoms of injustice.

If charities start talking about the causes, the Charity Commission jumps on them for being "political" and if parties, even governments get serious about causes, they are accused of being "socialist" or even worse!

One answer is to create monetised social markets.
This is much easier to do than the creation of monetised environmental markets.

The effects of social dislocation are clear for all to see and a lot of work has already been done on identifying the financial costs, whether in policing, social work, health - mental and physical, prison or other budgets.

The key to the creation of the monetised social market place is whole life costing versus early intervention.

A clear example is a child who has been born with disadvantage. Depending on the nature of the disadvantage and the resilience of the child, the support available and so on, the disadvantaged child has a greater than average chance of entering the criminal justice and mental health system. The costs of early intervention, timely intervention and opportunities for intervention at every stage will almost invariably be less than costs of not intervening.

This is not new, of course. It is the rationale for schemes like Sure Start.
However, the monetised social values are not usually made specific and therefore a financial market is not created for social or private enterprise to enter. This leaves the scheme in the hands of the public sector, either through direct delivery or procurement mechanisms.

The potential for a monetised social market place is exciting, but not without pitfalls. For example, if the invest to save rationale really works, then jobs in the sectors dealing with the casualties of social injustice will decline.

This is where a new level of sophistication will be required - the linking of the social markets with the environmental markets. Fewer jobs is generally seen as a bad thing in an economic context. But if the necessary work is shared around, then a reduction in economic activity can have a positive environmental and social value.

And having more time to reflect and enjoy the simple things in life will surely generate spiritual value. I am not sure we want to monetise that though!

steve

Social Value and the Triple Bottom Line

In 1994, John Elkington coined the term Triple Bottom Line which is an agenda that focuses not just on the economic value that business brings but also on the environmental and social value that it can add – or destroy. In 1998 John expanded and articulated his views in his book Cannibals with Forks: the Triple Bottom Line of 21st Century Business.

Although many companies find the economic and environmental issues relatively easy to understand and address it is the social value element that appears to be difficult to manage.
This is where I believe that Du can add real value because founders Cameron Gordon and Steve Day understand that most of the time it's the system that causes the problem, not the people in the system.

Du’s Service Design takes ideas and turns them into strategic outcomes by working not just with those supplying the product/service but by involving the end-users. This process helps identify any end-user concerns and can also help to highlight issues that may not have surfaced in the initial planning stage.

Although Du’s service design process can be used my almost any type of business perhaps it is in the Community, Voluntary and Public Sector where Du’s approach can add value. People, in general, are more likely to support and use a service in which they have a stake. Everyone has an opinion from who should be the next England football coach to how often the local bus should run. It is when services are just imposed on them that people feel undervalued and this can lead to suspicion about hidden public service agendas, etc.

So, Du’s service design process may be a good thing for the end-users but what about those within the business who would traditionally be doing the work; should they feel threatened? I don’t think so because by bringing in Du they will have more time to focus on their strategic planning roles. The learning that Du will bring from working with the client and the local communities will be of benefit to both sides. The client will be able to incorporate perhaps unforeseen concerns and issues into its strategy and individuals within the community will gain some ownership of the new service.

If people own something they are more likely to look after it, e.g. if children plant a school garden it appears that they are less likely to vandalise it.
It is often the system that causes the problem, not the people in the system.


Pauline Short
Du Marketing Associate

There's no need for any comment on this one

From BBC Wiltshire today:

"A pensioner has been told she must stop tending a public flower bed unless she agrees to wear a fluorescent jacket, put up warning signs and use a lookout.
June Turnbull, 79, of Urchfront near Devizes, has nurtured the blooms on the plot for eight years.

But now she is being told to obey health and safety rules after being spotted by a county council official.

Mrs Turnbull said: "They can send me to jail if they like - I just want to be left alone to do it."

Cameron

RES, GVA, GNH and other TLAs

The Regional Economic Strategy (RES) for North East England has, unsurprisingly, a strong emphasis on economic growth.

As with any government strategy, things have to be measured, and since it is much simpler to measure what can be counted, Gross Value Added (GVA), has been selected as the main indicator of progress in the region.

Underlying this main driver of the RES is an assumption that economic growth is a good thing per se.

Yet, elsewhere in the RES Action Plan, we find a reference to One Planet Living, though very little action is proposed to achieve it.

One Planet Living is a concept for environmental sustainability, that suggests that current European rates of consumption require three planets. Our choice then is to colonise two more planets or radically reduce our consumption on this one. In the USA, five planets are required and countries like China, currently at one planet level, are driving towards unsustainability.

In this context, GVA only perpetuates the problem. We need to reduce economic activity in a managed way, if we are to play our part in ensuring a future for our children and grandchildren.

The Unique Selling Point (USP) of our region is that we are not as hooked on conspicuous consumption as our overheated compatriots in the South East. We can use our relative economic backwardness as a positive and start to develop more sustainable indicators like Social Value Added (SVA) and Environmental Value Added (EVA).

Perhaps the best three letter acronym (TLA) is Gross National Happiness (GNH), an indicator devised in Bhutan, which proposes four pillars: equitable and sustainable socio-economic development, preservation and promotion of cultural values, conservation of the natural environment and establishment of good governance. The measure has room for improvement in its translation from Bhutan to Britain.

Wellbeing studies consistently show that whilst poverty has an adverse effect on happiness, increased wealth has no impact after a certain point. Happiness or contentment are most likely to be achieved when people have the sense that they have some control over their lives - and this is much, much more than adding economic value. Working together to find ways to live sustainably and leave something for future generations has the potential to give us the best TLA of all - PoM (Peace of Mind).

steve

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These are the personal thoughts and musings of Du Directors, Associates and Friends on just about anything

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