Full cost accounting refers to accounting for the complete cost or benefit of some product or service in terms of its social, economic and environmental impacts. It represents an expansion of our traditional accounting systems to incorporate the full set of impacts relating to a given economic activity. Our traditional accounting systems are designed to account for what economists call utility. But utility and monetary value only account for what something is worth to an individual, it does not account for its cost or value to the whole of society or ecosystem.
This is part one in a five-part series of papers on the rise of the paradigm of sustainability. In this paper, we look at what sustainability is and how our economies will be shaped along a number of dimensions as it grows in significance in the coming decades.
The 20th Century, driven by scientific and technological advances, was a time of remarkable change for human civilization. But it was also a century when the extraction of many natural resources began for the first time in history to follow an essentially exponential growth path.
Since a number of decades now the unsustainable nature of our industrial economic infrastructure has been made acutely evident. It is becoming increasingly clear that the linear model to industrial age systems of organization creates many negative externalities that render them unsustainable.
The social dilemma - otherwise known as the tragedy of the commons - is at the heart of many of the21st-centuryy challenges from over fishing and environmental degradation to social inequality and political discontent. Put simply social dilemmas are situations in which collective interests are at odds with private interests. Such situations arise when faced with prioritizing either short-term selfish interests or the long-term interests of a group, organization, or society. The classical example give