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October 5, 2020

Women and girls in the age of the Pandemic

by Vanessa Smith                                                                                                   

Women and girls are at an increased vulnerability, even before the effects of the COVID-19 pandemic. The increased burden of unpaid child care and household responsibilities, a side effect of the global pandemic, falls more so on women and girls than it does on men. Women dropping out of the labor force increased by 30% in India, and increased the number of hours women in the United States spend on responsibilities at home from 1.5 to 2.0 hours.

Moreover, women in lesser developed countries are more likely to be involved in informal work such as small business subsistence work and domestic work, and are less likely to have the type of safety net of social protection measures, as revealed in a recent report by the World Bank. Women working on smallholder farms and traders will see a decline in crop productivity and an uptick in food pricing and closed borders, reducing their ability to sell, buy and trade.

Female participation in the labor force is two thirds of their male counterparts, and the likelihood of women receiving the same opportunities as men to reskill and re-enter the labor force is disproportionate to that of their male counterparts.

A report published by McKinsey and Company highlights the stark numbers of the gender equality gap. The report highlights data which puts the reality of gender parity into perspective. Female job loss is 1.8 times higher than it is for their male counterparts in the United States in India. That is at 5.7 rate versus the 3.1 rate that men face in light of the COVID-19 pandemic.

Labour-related exposure is also notably higher in women. Women are at a greater risk because of their disproportionate numbers in labour sectors more at risk to the COVID-19 pandemic. Women have significantly larger numbers in the health care industry, putting our female front-line workers are greater risk, and the stress of not only battling their own effects of the pandemic, but that of their entire communities.

Farmer weeding maize field in Bihar, India
Copied with permission “Farmer weeding maize field in Bihar, India” by CIMMYT is licensed under CC BY-NC-SA 2.0

Women’s health risk is increased not only in their higher risk workforce exposure, but also because of their unique childbearing responsibility. Childbirth during the pandemic causes another layer of vulnerability that is exclusive to women and their unborn children. Despite childbirth mortality rates leveling off and dropping in recent years, black women, particularly in the United States have a 2.5 greater risk than their white female counterparts to experience complication and mortality during childbirth. UNICEF reports that even before the COVID-19 pandemic, an estimated 2.8 million pregnant women and newborns died every year, or 1 every 11 seconds, mostly of preventable causes. That level now is at a greater risk as exposure to COVID-19, stressed health systems and a disruption to services complicates matters for pregnant women across the globe.

“Millions of mothers all over the world embarked on a journey of parenthood in the world as it was. They now must prepare to bring a life into the world as it has become – a world where expecting mothers are afraid to go to health centres for fear of getting infected, or missing out on emergency care due to strained health services and lockdowns,” said Henrietta Fore, UNICEF Executive Director. “It is hard to imagine how much the coronavirus pandemic has recast motherhood.”

Gender inequality is real and not only reflects a flattening level of progress of society, there is a very strong case for its economic impact. McKinsey reports a $1 trillion-dollar economic impact for business-as-usual of the economic cost of gender inequality, citing through their different projected models that if we focused on policy and improved gender parity measures, the potential for economic growth could be around $13 US trillion dollars.

Policy, increased training and corporate responsibility will prove to be critical to transforming the outlook for our society, and women. Educating policymakers and pressure for institutional reform in countries around the world is an important component to global gender parity. Highlighting companies invested in female inclusivity will prove to create significant impact on women, girls and society at-large. Reskilling women, education and female focused programs can also lead to a faster recovery not only form the COVID-19 pandemic, but also makes a case for stronger and more resilient communities and cities during the economic recovery.

September 14, 2020

The Future of our Global Economy

2020 has proven to be a year that has drastically changed our planet, society, and economy. Globalization has taken on a new meaning as our current systems, which were inadequately prepared for the pandemic and the compounding extensive battle of racial inequality brewing to the surface, set a pathway for recovery.

The world is now rapidly working on a recovery plan to help stabilize the shock in this moment in our history. As we look back in time to this period, will we ask ourselves if we were properly organized and best prepared for these events? A new economic model and innovation in whole systems view for preparedness might prove to be an effective method for our recovery and planning.

Disease Outbreak, Emergency Readiness and Global Stability

A critical component to the COVID-19 outbreak in the early part of 2020 was our ability to deal and effectively deploy a plan of action that might have enabled us to quickly react and alleviate some of the complex problems that are associated with a global disease outbreak. This is not an easy answer, and comes riddled with uncertainties and demand of predictive modeling that certainly would require large scale coordination, technology, and other valuable global modeling to effectively cope and organize infrastructures and systems. Despite the definite globalization of the world’s economy, we have not the globalized infrastructure or framework that could answer to such order should it collapse from natural causes, market crash or other unforeseeable events. Supply chain, markets, health systems, data, economy, food supply, climate change, water scarcity and other factors showed us what such an order might entail.

The United Nations Charter

After the second world war, the United Nations was established under a Charter in 1945. The goal of the United Nations is to “keep peace, develop friendly relations among nations, to improve the lives of the poor, conquer hunger, disease and illiteracy, encourage respect for each other’s right and freedom’s and to be a center for harmonizing the actions of nations to achieve these goals”.

The United Nations is a center for a great many things that have enabled our global society and economy to progress in ways that weren’t possible before. Despite the differences of many nations in the way they create policy and define diplomacy, the United Nations has been able to define peace and carry out its mission since the original Charter which brought it all together. The United Nations is organized by six principal organs: Security Council, the General Assembly, Economic and Social Council, the Trusteeship Council, the International Court of Justice and the UN Secretariat. Each organ has an important mission and goals to carry out under the United Nations Charter.

The United Nations is comprised of 11 Programmes and Funds, including the UNDP and UNICEF, which provide for sustainable development and humanitarian relief. The UN holds Specialized Agencies including the World Bank, the World Health Organization, the International Monetary Fund – which are considered today’s global infrastructures that shape, manage, plan and develop our global order.

The United Nations, however, is burdened with a complexity that disables its ability to react, model, deploy, and be effectively nimble and proactive when necessary. Moreover, its’ political structure and composition disables its ability to make overarching decisions that are best for the planet without agreements of conflicting government leadership. Its mission is to maintain peace but satisfy current government leadership within that context, making it ineffective when achieving goals that are best for the environment, society, peace, and advancement. Lack of trust in our existing infrastructures in surging, so a thoughtful plan on what can satisfy the existing order while also creating a path for a more sustainable, advanced, and productive new world order is important for global stability and planetary advancement. A globalized order, hyper-localized and global in structure, which complements the United Nation’s mission while also creating new, disruptive, and innovative thinking is certainly in order.

Global Poverty and Hunger in 2020

The World Bank’s goals include” to reduce the number of people living in extreme poverty” which was, according to the World Bank’s figures, 734 million people, or 10% of the world’s population in 2015. The economic value given to extreme poverty is $1.90 a day, though it is largely argued, and considered by Philip Alston, Special Rapporteur on extreme poverty and human rights, a “miserable subsistence” if this monetary value, even adjusted for PPP, is sufficient or adequate, or even qualified as a moral dollar equivalent for what is considered a minimum economic value (World Bank). It is argued by economists such as Philip Alston,  that a minimum value of $5.50 a day, with PPP adjustment, would come somewhat closer to a minimum for the extreme poverty line. If there is even a  moral argument at all for poverty levels which constitute a bare minimum rate of survival (health, prosperity, education, quality of life indicators not properly evaluated or calculated). And, according to the World Food Programme, more than 250 million people are at risk from extreme hunger as an effect of the COVID-19 pandemic.

Global Climate Change and the Value of Nature

Global climate change has been either ignored, as is under the current US administration’s policy to withdraw from the Paris Climate Agreement, or hugely emphasized, as is throughout the European Commission. New value systems are taking a more important place in our global economy and markets, as asset management companies, such as BlackRock, are responding to investors requests and logical forecasts that consider a sustainability model as important, if not more so, than traditional valuation methods from years past. BlackRock is divesting from companies that do not incorporate sustainability into their model, and investing in more forward-thinking companies, as recently presented at Nasdaq’s 1st European ESG Summit in Oslo early September.  Science and data has allowed us to make more informed decisions, giving way to sustainable development goals as increasingly central formulas for values in business, economy and markets.

There are several models and frameworks throughout the world which envelop global consideration of future generations quality of life and wellbeing. Valuation is crucial to move the pendulum and the increase of value in ecosystem services, biosphere, natural, social and human dimensions and hopefully considered outside of the poor indicator of willingness to pay.

Willingness to pay is a luxury and does not account that traditional models are a set of global agreements, and not necessarily based on real life, or hard, indicators. There are a number of factors to consider when arguing for WTP model:  Should our planetary systems even be considered “free”, what is the value, then, of anything produced from “free systems”, why would anyone be willing to pay for something that is free, that the free non-market values (externalities) are in fact being expensed by means of companies polluting the air and water and resource exploitation and land degradation (can this be considered a type of taking, and is that the reason it remains non-market, shadow and free?) and how can we ask what someone is willing to pay for something when subsistence or bare survival  from resources such as food, water, housing and education are primary to a person’s decision making process. Our planetary values should be considered a rent in markets and would help offset the disbalance of the global economies.

What is the value of our natural world? In 1997, Robert Costanza et al. attempted to give this a value. In The value of the world’s ecosystem services and natural capital,  Costanza proposes an evaluation of 17 ecosystem services for 16 biomes, valuing activities “at the margin”. It is notable to mention that military defense works as mentioned “at the margin”. According to Costanza’s methodology, though a partial equilibrium method and not considered by the author as the most superior in contrast to input-output methods, in today’s economy would roughly value our biosphere at around $157.86 US trillion dollars, a 1.8 factor of today’s GDP.

Military Industrial Complex

Human and natural capital figures are also seemingly omitting military spending, which is a critical dimension to consider when analyzing debt, GDP, accounting systems, natural, human and social capital dimensions. This, though, is not widely applied in our current analysis of human and natural capital, though it is my argument that military budget is indeed a critical dimension to natural, human and social capital systems. The United States military budget, the largest in the world, was $686 billion in 2019 (SIPRI). To consider a true measure of complex systems design for value of our planet, military activity, alongside man-made activity, should give us more answers to our global problems.

This is the hypothesis and basis for R&D currently under applied research for the development of an index and platform to consider these various factors at Star Systems and Earth Foundation.

 If the global economy is at a –$250 trillion US dollar debt, the world’s biosphere roughly estimated (outside of our markets) at +$157 trillion US dollar, to raise the world’s poor out of bare poverty estimated at roughly +$4.948 billion US dollars. Global military expenditures are roughly $1.917  US Trillion dollars, not accounting for actual impact values within the military budget. All of these factors contribute to what is a disbalance and inaccurate global accounting system.

Through a more accurate accounting system which places the inherent value of life in to an operating system we can begin to divest the military from armament and negative natural and human impact value, and through this index and model I present, value the divestment from “war inducing” activity and value the investments in “peace setting” activity, among some of the factors the military could be valued for, for economic valuation. Through the valuation of these economic values we could possibly achieve our global goals and targets for peace, prosperity an ecologically rich, natural, abundant and advanced society and planet.  

Corporate impact

The value of government, military and agencies’ impact and corporate impact should be homogenous in order to be most effective. Valuing externalities in all of our systems, for a true holistic model, is critical for our global common collective and to design ourselves into a future thinking model and framework.

Global Debt and Accounting Systems

SEC has recently reported a figure of global debt at around $250 trillion US dollars, or a 320% of the global GDP value. Is it as well argued, whether or not our current economy is correctly valued?

Valuing man-made activity in natural and human and social dimensions, should be considered part of the calculation for proper economic accounting rather than just straight natural and human capital metrics. That is to say the current value of natural and human systems are an effect of our man-made activity, and alone are not properly accounted for considering current value is based on “something else.” Natural and human capital alone would have been accurate as a measure alone only at the beginning of time, before man-made activity affected its value.

The New Economy

Circular, green, and blue economies including industrial ecology and regenerative principles are more widely being considered as we move towards a more sustainable vision for our planet and future.

Soon enough, it will be without reason for development and production to occur without careful design, planning and consideration for long-term effects. We, as a society, are at a tipping point -which makes the decisions we make today incredibly more valuable than ever before. Without a clear vision for the future and what that might look like for future generations, we risk losing more than we bargained for. There is a bright future ahead of us, so long as we are considerate that our actions today are an extension of our future.

August 19, 2020

Renewable Energy

Renewable energy sources are key to transitioning into a new economy and for sustainable development goals. 100% renewable energy targets ensure that we are providing for our future and generational safety and prosperity. Resilient and clean energy sources will be a testament to our longevity and the success of not only the planet, but society and the economy. They also provide for global stability and overall health of the human population.

SDG - Goal 7

There are key elements to the transition. The United Nation’s Sustainable Goal 7: Affordable and Clean Energy looks to expand and increase the use of renewable energies by the year 2030 by cooperation and access to all. We are in great support of this goal, however the opportunity to increase the share of renewable energy mix could be at a 100% by 2035, and would increase decarbonisation rates more expediently, lessen toxic damage and increase innovation and economic endurance in doing so. Strong leadership in energy transition is sound economic and political policy; competing for outdated models in fossil production is costly, unhealthy, inefficient and destabilizing.

A pathway to 100% renewable energy includes:

  • Transition the electricity sector to clean, renewable energy.
  • Equitable and fair access by ensuring that renewable energy is accessible to all members of society.
  • Carbon and pollution free energy provided from wind, solar, tidal and geothermal sources.
  • Inclusive participation of community and small businesses.

Conversion is sound economic policy as well. Transition would prevent an estimated $3.3 trillion per year in the year 2050 global warming costs from U.S. emissions alone.

“Converting would further eliminate $3.3 (1.9–7.1) tril. per year in 2050 global warming costs to the world due to U.S.
emissions. These plans will result in each person in the U.S. in 2050 saving $260 (190–320) per year in energy
costs ($2013 dollars) and U.S. health and global climate costs per person decreasing by $1500 (210–6000) per
year and $8300 (4700–17 600) per year, respectively” (Jacobson, Mark et al. Energy Environ. Sci., 2015, 8, 2093).

Renewable energy increases resiliency, helps decrease social inequalities by providing healthy ecosystems, provides stronger and leaner companies and ensures a brighter future and economy.

August 9, 2020

The New Economy

The way we do business affects our society and environment. Historically, economic growth has been at odds with environmental sustainability. The degradation of our finite resources and social inequality has translated into an unbalanced growth with long-term consequences. Recently, we have seen features of the COVID-19 pandemic show how these precipitate. As businesses closed and shelter in-place orders were mandated across the globe, we saw air pollution take a significant dip.

Coastal regions are affected by rising water levels, causing looming migrations into already dense urban areas. A new and balanced approach to economic success is necessary in order to prevent massive destruction that paralyzes our future generations. There are new economic models, such as the circular economy, which incorporate long-term goals with short-term economic objectives. This type of whole system approach is a novel approach and becoming more widely adopted as businesses, governments and agencies accept the responsibility of the impact their work has on our society beyond current GDP indicators.

Our focus should be on new technologies for creating clean and sustainable economic chains, rather than “cleaning” dirty industries. Extraction rates, which is the rate of extraction of our finite natural resources, have increased in the last decades, driven by an increase in the global population and per capital extraction rates. The economic system needs to be transformed in order to achieve dematerialization goals (Kallis 2017). Decoupling economic growth by reducing negative impacts on the environment significantly reduces the rate of use of our resources and boosts economic growth, contributing to sustainability goals.

In brief, in order to achieve eco, social and technological progress under ecological boundaries, a redefinition of current understanding regarding domestic material consumption and development is required (Oberle et al 2009).

Industrial Ecology

Industrial ecology is the means by which humanity can deliberately and rationally approach and maintain sustainability, given continued economic, economic, cultural, and technological evolution. The concept requires that an industrial ecosystem be viewed not in isolation from its surrounding system, but in concert with them. It is a systems view in which one seeks to optimize the total materials cycle from virgin material, to finished material, to component, to product, to obsolete product, and to ultimate disposal. Factors to be optimized are resources, energy and capital.

—Graedel and Allenby, 2002

Blue Economy

The Blue Economy consists of the preservation and utilization of our marine waters. Oceans protect biodiversity, provide jobs, food, drive economic growth, keep the planet cool, and absorbs about 30% of global CO2 emissions (World Bank). The blue economy represents all economic activities related to our oceans, seas or coastal areas. Industries related to the blue economy consist of fisheries, shipbuilding and tourism as well as emerging industries, including ocean energy and biotechnology. The coronavirus pandemic has significantly affected the blue economy; coastal and marine tourism, as well as fisheries and aquaculture, are severely affected. The blue economy as a whole presents a huge potential in terms of its contribution to a green recovery.

With the responsible development of ocean management, sustainable renewable energy sources, and the integration of social and environmental aspects, our blue economy can double in a sustainable way by 2030. The value of the blue economy vary, with Africa valuing its marine water at an estimated $1 trillion dollars. However, the true value of our marine waters should be considered outside of their direct energy, aquaculture, fisheries, tourism, and shipping value. Our marine waters store a substantial value of ecosystem services that is essential for our planetary growth and success.

A Prosperous Future

The United Nations (UN) World Commission on Environment and Development defines sustainable development as a trajectory where future generations are secured the same level of welfare as present living generations. As the number of middle class rises, our natural resources are required to support population expansion and will rapidly decrease at current trends. Waste generated by high income countries is currently estimated at 3.5 million tonnes per day, and is growing in proportion to the growth in middle-class populations. In addition, 2 billion tonnes of solid waste are produced each year by the world’s cities. Sustainable industrial initiatives are necessary to stabilize our environment and society and decrease the depletion of our natural resources, reduce emissions, and stimulate regeneration of our natural ecosystems.

This principal promotes systems thinking and is regenerative by design.

This economic principle start with the design process, with a focus on action and investment in a framework that guides us deliberately toward disarmament, improved air quality, regenerative ecosystems, peace, and a higher standard of living and wellbeing for the whole world.

August 6, 2020

Regenerative Design for Sustainable Development

Regenerists believe in conservation, recognizing that humans are part of the ecosystem. The approach is one of incorporation rather than focusing on preservation, which segregates wild areas from human habitat.

Sustainable design aims to provide for fundamental human needs, whereas regenerative design goes further in that it plans for the future co-existence and co-evolution of humans and other species.

Systems Design

Regenerative design promotes systems thinking. Systems thinking is a whole systems approach, where we recognize that the whole is greater than the sum of its parts. Systems design is non-linear, feedback-rich, and interdependent.  This design approach is as close to closed systems as possible, increases longevity and resilience, and has the potential to encompass regeneration and evolution in living systems.

Systems thinking emphasizes stocks and flows since replenishment of stock is inherent in feedback-rich systems. Six notable themes in systems thinking:

  • Interconnectedness
  • Circular
  • Emergence
  • Wholes
  • Synthesis
  • Relationships

Feedback loops

Feedback loops are a design aspect in circularity, and how nature’s own ecosystems operate. In design, there are two types of feedback loops: reinforcing and balancing.

Reinforcing elements in a system are abundant of one element and can continue to refine itself, which often leads to it taking over.

Balancing elements in a system, such as predatory/prey situation in nature, does exactly that- balances things out.

Efficiency

How does that ascribe in business modeling? Systems thinking in business context is adaptive and modular, lending itself to innovation and diversified value chains and less dependence on short-term strategies. Understanding flows in complex systems tell us about trade-offs between efficiency and resilience.

Efficient systems incorporate less nodes, less connections, and increases throughput. However, increasing efficiency systems become brittle, vulnerable to price volatility or interruptions of chain.

Circularity in Supply Chains

Circular procurement focuses on closing energy and material loops within supply chain. There are two pillars:

Pillar One:

Promoting circular supply chains by procuring more circular products, materials and services.

  • Embed approach in circular supply chain by procurement criteria
  • Promote product lifetime extension

Pillar Two:

Promoting new business models based on innovative and resource-efficient solutions.

  • Resource-efficient solutions

Social Dimensions in Sustainability Models

Our beautiful planet is a complex set of systems managed by society and people. A critical aspect to a balanced and sustainable model in circular economy are human and societal dimensions. In order to successfully measure economic performance, a quantifiable measure of social progress is critical. The OECD quality of life index is modeled after Stiglitz, Sen, Fitoussi (2009) and includes the following dimensions:

Quality of Life indicators for current well-being

  • Health
  • Work-Life balance
  • Education and skills
  • Social connections
  • Civic engagement
  • Environmental quality
  • Personal security
  • Subjective well-being

Material Conditions

  • Income and wealth
  • Jobs and earnings
  • Housing

Future Resources for Well-Being

  • Natural capital
  • Economic capital
  • Human capital
  • Social capital

Conceptual Approaches to measuring Quality of Life

Subjective well-being- enabling people to be happy and satisfied is a universal goal of human existence.

Capabilities- conceives a person’s life as a combination of various “doings and beings” (functionings) and of his or her freedom to choose among these functionings (capabilities).

Weights- the various non-monetary dimensions of quality of life (beyond goods and services that are traded in markets) in a way that respects peoples preferences. “Fair allocations approach” tries to overcome by explicitly referring equity criteria.

Education and health matter for quality of life independently of its effects on people’s earnings and productivity. Measuring these benefits is important. How people spend their time, and features of activities, is important as well- irrespective of income they generate. Political voice is an integral dimension in quality of life. It helps evaluate the functioning of democracy and universal suffrage, degree of decentralization in government decisions, sense of participation, and freedom of media and civil and other participatory organs.

Star Systems is committed to incorporating social and natural dimensions and capital for the prosperity of our planet and society. By regenerating nature and promoting equity we can design our very own futures in novel ways. Understanding the symbiotic relationship of our planet and society increases longevity, health, and the evolution of our planet- for the advancement of society, environment, and economy.

This is our future.

Future by Design