MULTI DIMENSION IMPACT ACCOUNTING
File: MDIA-p3-02-MAN-BUILT-CAPITAL-150609.odp Peter Burgess (c) All rights reserved
MDIA
MAN BUILT CAPITAL
MULTI DIMENSION IMPACT ACCOUNTING
WORK-IN-PROGRESS.SLIDESET STILL IN DEVELOPMENT.UPDATES WILL BE POSTED OVER
THE NEXT SEVERAL WEEKS
MBC … MAN BUILT CAPITAL ...is part of an extremely complex SOCIO-ENVIRO-ECONOMIC SYSTEM
MULTI DIMENSION IMPACT ACCOUNTING
The next slides shows: MAN-BUILT CAPITAL
GOVERNMENT, CITIES, INDUSTRY AND A LOT MORE
MULTI DIMENSION IMPACT ACCOUNTING
MULTI DIMENSION IMPACT ACCOUNTING
ELEMENTS OF THE SYSTEM by SEGMENT (1)
FinancialCapital
HumanCapital
Man BuiltCapital
NaturalCapital
Sun
FinancialCapital
HumanCapital
Man Built Capital
NaturalCapital
Sun
Part of Man Built Capital (MBC) Metrics around money and wealth are everywhere
Human Capital is about the Quality of Life and Standard of Living of PEOPLE, and as such, is the most important
purpose of economic activity … but no metrics
Man Built Capital(MBC)There are metrics for efficiency and effectivenessin private for profit organizations, but less so for
the public sector and for the commons
Everything is built on top of Natural Capital, that is all theresources that occur in nature, the environment in all its
complexity and ecosystem services that it enables … verycomplex detail metrics, difficult to understand and no way
to summarize these metrics and use them effectively
Sun … the ultimate source of all energy
MULTI DIMENSION IMPACT ACCOUNTING
ELEMENTS OF THE SYSTEM by SEGMENT
FinancialCapital
HumanCapital
Man BuiltStructures& Systems
NaturalCapital
Sun
FinancialCapital
HumanCapital
Man BuiltStructures & Systems
NaturalCapital
Money FoodGovernmentNature (life)
Sun
Nature (life)
Capital Market Value
WaterLaws. RulesNature (life)Land
ShelterInfrastructureWater Clothes
IndustryNature (life)AirHealth
MiningEcoservicesEducation
Energy SkillsWaste
RecreationRetailCulture
Logistics ReligionKnowledge
Technology
Security
Energy
Mobility
Profit
The 5 Capitals of MBC:● Financial Capital● Physical Capital● Knowledge Capital● Institutional Capital● Social Capital
MULTI DIMENSION IMPACT ACCOUNTING
MULTI DIMENSION IMPACT ACCOUNTING
Sun
BOP EOP
Sun
FinancialCapital
HumanCapital
Man BuiltCapital
NaturalCapital
Sun SunSun
FinancialCapital
HumanCapital
Man BuiltCapital
NaturalCapital
Sun
Institutional Capital
Physical Capital
Knowledge Capital
Social Capital
Financial Capital
About Man Built Capital
Man Built Capital
Man Built Capital … Man Built Structures and Systems (MBSS) … are everything not PEOPLE and not NATURE.
MULTI DIMENSION IMPACT ACCOUNTING
The PURPOSE of all economic activity is:
(1) to enable an improved Quality of Life and Standard of Living for PEOPLE; and,(2) to do this without stressing nature and the enabling natural systems.
Man Built Capital in all its manifestations have been developed and deployed to make this possible.
MULTI DIMENSION IMPACT ACCOUNTING
SOCIO-ENVIRO-ECONOMIC● SOCIO is Human Capital … PEOPLE;
● ENVIRO is Natural Capital … NATURE;
● ECONOMIC is everything that MONEY measures … that is MBC (Man Built Capital).
MULTI DIMENSION IMPACT ACCOUNTING
● SOCIO is a PEOPLE perspective. Everything should result in people progressing.
● ENVIRO is about NATURE and the ultimate source of everything that people can ever have; and,
● ECONOMIC is MAN BUILT CAPITAL … all sorts of structures and systems that have been built to enable progress.
MULTI DIMENSION IMPACT ACCOUNTING
Financial Capital is part of Man Built Capital but separated out for the purpose of analysis because it has become such an important part of the conventional way of measuring … specifically: (1) business profit; (2) capital market valuations; and, (3) GDP growth.
MULTI DIMENSION IMPACT ACCOUNTING
MULTI DIMENSION IMPACT ACCOUNTING
Sun
BOP EOP
Sun
FinancialCapital
HumanCapital
Man BuiltCapital
NaturalCapital
Sun SunSun
FinancialCapital
HumanCapital
Man BuiltCapital
NaturalCapital
Sun
WHAT IS THIS?
Future flowsof profit
determinecapital market
valuation.Change
becomes anIncrement to
financial capital.This is the making of fictional or
virtual wealth
Debits andcredits ofmoney result in
profit whichIncrements
financial capital
About Financial Capital
Money
Stocks and BondsOwnership of Securities
Real EstateOwnership of Physical
Assets
Ownership of AssetsOwnership of Debt
In the end, all FC isowned by people
WHICH OF THESE IS RIGHT?
MULTI DIMENSION IMPACT ACCOUNTING
Sun
BOP EOP
Sun
FinancialCapital
HumanCapital
Man BuiltCapital
NaturalCapital
Sun SunSun
FinancialCapital
HumanCapital
Man BuiltCapital
NaturalCapital
Sun
Nature (life)
Land
Water
Air pollution
Ecoservices
GHG emissions
About Nature (Life)
GHG Emissions
Green House Gas (GHG) emissions like CO2, CH4 and others cause global warming, which is having impact
on weather patterns and other systems.
The natural ecosystem service capacity is not enough to balance
the emissions originating from
man built systems
Institutional Capital comprises:
● Government Departments and Agencies;● A framework of law;● Systems of law enforcement and justice; ● Security capacities;● Corporate organizations;● Health systems;● Education systems;● etc.
MULTI DIMENSION IMPACT ACCOUNTING
MULTI DIMENSION IMPACT ACCOUNTING
Sun
BOP EOP
Sun
FinancialCapital
HumanCapital
Man BuiltCapital
NaturalCapital
Sun SunSun
FinancialCapital
HumanCapital
Man BuiltCapital
NaturalCapital
Sun
Institutional Capital
Physical Capital
Knowledge Capital
Social Capital
Financial Capital
About Man Built Capital
InstitutionalCapital
Government,Rule of Law,Companies,
Organizations.
Systems for:Health
Education,Banking,
Social Services,Security,
etc.
Physical Capital
Some of this is owned by Corporate Organizations, some by Private People and some by the Public Sector.
Ownership has been a key feature of modern capitalism … and is worthy of more study and understanding.
MULTI DIMENSION IMPACT ACCOUNTING
Physical Capital comprises:
● Infrastructure;● Factories;● Machinery and equipment;● Transports vehicles (ships, aircraft, trucks, railcars, etc.);
● Houses and apartments;● Offices, hotels and commercial buildings;
● Computers, etc.
MULTI DIMENSION IMPACT ACCOUNTING
MULTI DIMENSION IMPACT ACCOUNTING
Sun
BOP EOP
Sun
FinancialCapital
HumanCapital
Man BuiltCapital
NaturalCapital
Sun SunSun
FinancialCapital
HumanCapital
Man BuiltCapital
NaturalCapital
Sun
Institutional Capital
Physical Capital
Knowledge Capital
Social Capital
Financial Capital
About Man Built Capital
PhysicalCapital
Commercial buildings,Factory buildings, Housing, Stores,
Machinery and equipment,Vehicles,
Infrastructure:Roads and bridges
RailroadsSeaports and airports
CommunicationsWater and sewer
Electricity, Oil and Gas,Hospitals, Schools.
etc.
Knowledge Capital
What we know enables productivity and performance.
Some of this is shared universally and is available for free use, and some is owned by Individuals and Business entities and may be used for their private gain at the expense of society as a whole.
MULTI DIMENSION IMPACT ACCOUNTING
Knowledge Capital
Knowledge Capital is expanding rapidly … faster than at any previous time in history.
Important parts of Knowledge Capital have been created with Government funds, often for military and security purposes.
MULTI DIMENSION IMPACT ACCOUNTING
MULTI DIMENSION IMPACT ACCOUNTING
Sun
BOP EOP
Sun
FinancialCapital
HumanCapital
Man BuiltCapital
NaturalCapital
Sun SunSun
FinancialCapital
HumanCapital
Man BuiltCapital
NaturalCapital
Sun
Institutional Capital
Physical Capital
Knowledge Capital
Social Capital
Financial Capital
About Man Built Capital
KnowledgeCapital
MathematicsPhysicsBiology
ChemistryScience of materialsComputer science
Information technologyBiotechnology
Artificial intelligenceRobotics
Social Capital comprises:
● Networks of friends and family;● Community;● Culture; ● Religion;● Community … people;● Community … access to services;● Social safety net;● etc.
MULTI DIMENSION IMPACT ACCOUNTING
MULTI DIMENSION IMPACT ACCOUNTING
Sun
BOP EOP
Sun
FinancialCapital
HumanCapital
Man BuiltCapital
NaturalCapital
Sun SunSun
FinancialCapital
HumanCapital
Man BuiltCapital
NaturalCapital
Sun
Institutional Capital
Physical Capital
Knowledge Capital
Social Capital
Financial Capital
About Man Built Capital
Social Capital
RelationshipsHuman interaction
TeamworkReligionCultureHistory
MULTI DIMENSION IMPACT ACCOUNTING
Money Government
Laws/Rules
PublicInfrastructure
Industry
Mining
Energy
Waste
Retail
Logistics
Knowledge
Technology
FinancialCapital
PhysicalCapital
KnowledgeCapital
InstitutionalCapital
SocialCapital
FinancialCapital
PhysicalCapital
KnowledgeCapital
InstitutionalCapital
SocialCapitalMBC
Water
Sewer
Regulations
Security
PrivateSector
PublicSector
ElectricGrid
BuildingsBanks
Capital Markets
Community
Culture
Religion
RecreationInsurance Health
Education
Roads
Transport
Public Lands
Research
ELEMENTS OF MAN BUILT CAPITAL (MBC)
OWNERSHIP AND FINANCINGThe matter of OWNERSHIP is important in the understanding of MBC.
This is especially true in connection with the financing of MBC,
Capital market financing is facilitated by private ownership, but the metrics for this mean that important things cannot get done because they cannot be financed.
MULTI DIMENSION IMPACT ACCOUNTING
Funding for Man Built CapitalThe funding for MBC depends on ownership.
If ownership is private, then funding is facilitated by profit potential.
If ownership is public (government) then funding is constrained by political will and government revenue limitations.
A sad reality is that initiatives with a huge potential for good go unfunded because the dominant financial system only has focus on profit hardly at all on good.
MULTI DIMENSION IMPACT ACCOUNTING
CONCLUSION
Our future depends almost entirely on how MAN BUILT CAPITAL (MBC) is managed.
KNOWLEDGE has the potential to be used to optimize PHYSICAL CAPITAL, INSTITUTIONS and SOCIETY so that impact on PEOPLE is as good as possible with as little negative impact on NATURAL CAPITAL as possible.
MULTI DIMENSION IMPACT ACCOUNTING
More than anything else, this will be achieved by implementing better metrics, metrics that account not only for the profits of the organization and the impact on FINANCIAL CAPITAL, but also impact the organization has on HUMAN CAPITAL (PEOPLE) and NATURAL CAPITAL (PLANET).
This is the goal of the MDIA (Multi Dimension Impact Accounting) initiative.
MULTI DIMENSION IMPACT ACCOUNTING
Moving forward … Request for collaborationMoney is part of a complex socio-enviro-economic system. While it works … it does not work as well as it should, nor as well as it could. The work of MDIA is to enable this complex system to work better.
MDIA needs to be a team effort. Join in and help to make the world a better place. Please get in touch.
Peter Burgess … [email protected]
MULTI DIMENSION IMPACT ACCOUNTING
Some links and contact information: Peter Burgess … [email protected]
Peter Burgess LinkedIn profilehttps://www.linkedin.com/in/peterburgess1
Link to TrueValueMetrics.org websitehttp://www.truevaluemetrics.org/
Link to navigation for MDIA slidesetshttp://www.truevaluemetrics.org/DBadmin/DBtxt001.php?vv1=list0200-Burgess-p3-Slidesets
MULTI DIMENSION IMPACT ACCOUNTING