“GDP Growth” does not capture many vital aspects of national wealth and well-being, such as changes in the quality of health, the extent of education, or the quality and quantity of natural resources. Thus GDP accounts are inadequate to evaluate the trade-offs encountered by India’s policy makers, and in the absence of an appropriate ‘sustainability’ yardstick,, the concept of ‘sustainable development’ in India remains at best an elusive dream. Visible symptoms of unsustainable development include large & persistent disparities in wealth levels between rural and urban communities, inadequate public investment in health & education, rapid natural resource depletion, and a widespread incidence of the “vicious cycle” of chronic poverty and environmental degradation in forest-dependent communities .

GAISP, our Green Accounting for Indian States Project measured sustainable development at a State level in India, sourcing data only from official Indian national databases, and consistent with the United Nations’ SEEA - 2003 guidelines. Adherence to these guidelines and sourcing data only from official national databases (but with granularity at State level) ensures legitimacy, fairness, & methodological consistency. GAISP’s results are available through a series of 8 monographs (see www.gistindia.org ) which adjust for externalities such as the un-marketed services of forests (carbon storage, bio-diversity values, ecological services, etc), the hidden costs of Agriculture, losses in freshwater quality and depletion of sub-soil assets. Human capital externalities are also evaluated and adjusted: the positive externalities of education, and the negative impacts of pollution on human health. Among the recent recognitions of our work internationally was the appointment of one of our co-founders, Pavan Sukhdev, to head the global G8+5 initiated study, TEEB, or The Economics of Ecosystems and Bio-diversity (seehttp://ec.europa.eu/environment/nature/biodiversity/economics/ ) .

'GIST has made an important submission for TEEB on Tropical Carbon Forest for GLOBE (Global Legislators for a Balanced Environment) and for consensus building at UNFCCC (COP15) in Copenhagen, December, 2009'.(for full report click 'Other publications' on the Publications page) .

Encouraged by the positive global response to our pioneering Green Accounting work at the national and state level in India, we have started a project to extend the principles of “Green Accounting” to the “Corporate” level .

We believe that the Corporation is the most significant form of human organization today, in terms of global production and employment. It is essential for Sustainability that businesses evolve on a sustainable growth path. Thus they must gear up to measure & manage their “externalities”, or their negative impacts on Nature (natural capital) and on Society (human capital and social capital). We recognize that optimizing a Corporation’s impacts on forms of capital other than its owned physical & financial capital, and doing so for stakeholders other than its own shareholders, is not within today’s remit for the Corporation. However, our vision for the Corporation is that it will survive in the service of community. The Corporation of the future will become a responsible organism in the service of society – a veritable “Capital Factory” TM processing and converting one form of capital to another in a net positive manner, consciously targeting and achieving (or even exceeding) this basic boundary condition for economic sustainability and human well-being.

We are championing this major step in the evolution of the Corporation by publishing a book called “Capital Factory TM : The future of Sustainability and the Corporation” . Our corporate sustainability metrics will be developed in collaboration with two UK-based partners, Tomorrow’s Company and KPMG, and through this collaboration we intend to take the concept through to a broader acceptance in the Accountancy profession, beginning with the UK and India.

Pavan Sukhdev,
Director, GAISP & Chairman, GIST
(contact: pavan.sukhdev@db.com )

P. Yesuthasen,
Executive Trustee, GIST
(contact: pyes@vsnl.com )