A New Economy

The Gross Progress Indicator and Benefit Corporation Lead The Way

By Diane Reynolds

The best way to reverse our destructive economy is to install systemic changes. Together the BC legislation and the new GPI legislation spur the kind of systemic change that can create a new economy, an economy that truly sustains.

A Benefit Corporation (BC) is mandated to follow the triple bottom line: people, profits, planet. The Gross Progress Indicator (GPI) is a GDP (the metric that has gotten us in so much trouble) altered to include data about environmental damage, health concerns, benefit of leisure time and other new metrics.

The BC was enacted a year ago and the GPI arrived this year after a collaborative effort by UVM’s Gund Institute for Ecological Economics and Gross National Happiness USA (GNHUSA) headquartered in VT

True Happiness

From Ven. Mathieu Ricard

“Happiness is not an endless succession of pleasurable experiences. That’s a recipe for exhaustion, not for happiness. Happiness is a way of being that comes with altruistic love, inner strength, inner freedom and serenity – and it can be cultivated as a skill, day after day, monthafter month.”

GPI

A world leader in GPI, UVM’s Gund will be developing VT’s GPI. The Gross Domestic Product (GDP) metric emerged from the Great Depression to track economic activity. At the state level it’s the GSP. Over the years the GDP has falsely become the measure of overall well-being and progress when in fact it just measures transactions between buyers and sellers. Research shows societal well-being cannot be reduced to financial transactions. The GPI in VT will supplement the GSP. Coordinating the GPI initiative, Gund’s Eric Zency led his class to develop 26 GPI variables that can adjust the GSP for social and environmental concerns.

“The point of the economy isn’t to crank through resources as quickly as possible. The point is to build sustainable well-being for our communities.”

The GPI will be used in 3 ways 1-budgetary decisions 2-measuring progress in policies and programs 3-determining public policy priorities. Sen. Anthony Pollina, a Washington County Progressive, shepherded the bill through the Legislature. He hopes the GPI will give advocates more solid footing to make the case economically for social and environmental issues. The legislation for the GPI was overwhelmingly approved by the Senate and passed the House 97-41.

Sponsored by Gund and GNHUSA, the May 30 “Measuring What Matters” conference brought together the data people from state agencies and non-profits. In order to create the 26 variables that make up the GPI, the Gund folks must capture actual data from the various sectors in VT. The GPI task force has until 1-15-13 to finish the task. They then present the result to the legislature.

VT became the first state to legislate a GPI. Maryland voluntarily instituted a GPI and their incredible website shows each of the 26 GPI variables explained in easy, user-friendly ways.

Visit the site green.maryland.gov/mdgpi

Benefit Corp (BC)

As of July 1, 2011, certain corporations can now legally follow a triple bottom line: monetary profit, social considerations and environmental concerns. On that date VT legislated into existence the “benefit corporation” (BC). A BC does not have to bow solely to the will of the shareholders. If Ben and Jerry’s ice cream had been a BC, Ben Cohen and Jerry Greenfield might have prevented the takeover by Unilever 11 years ago. Unilever made the highest bid for B & J’s, so the laws of shareholder responsibility forced the founders to sell, even though they wanted to keep control.

Having worked at B & J for 12 years, SunCommon co-owner Dwayne Peterson knows first-hand how helpless that feels.

“The new law puts all the stakeholders on notice that these businesses intend to make a profit but they will also attend to the needs of their employees and communities and Nature herself. This counters the historic legal requirement to maximize shareholder profit above all other obligations. B & J showed that it was wildly successful BECAUSE of the 3 measures….that the 3 aren’t a handicap at all.”

In VT A company can set up as a BC or convert to a BC.

From the June, 2012, Green Energy Times