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PRODUCTS
The ROLE of PRODUCTS in the SOCIO-ENVIRO-ECONOMIC SYSTEM
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PRODUCTS ARE CONSUMED BY PEOPLE
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Food - Vegetables
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Food - Meat
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Housing
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Clothes
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Mobility
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Recreation
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More consumption correlates to a better quality of life up to a certain level. Beyond that level more consumption may well have negative consequences, as for example too much food may result in obesity and diabetes or worse.
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PRODUCTS ARE PRODUCED BY COMPANIES
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COMPANIES HAVE A BIG IMPACT ON SOCIETY AND THE ENVIRONMENT
Companies are accountable for profit, but not social and environmental impact.
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DIGITAL TECH
Google
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OIL & GAS
ExxonMobil
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AERO ENGINES
Rolls Royce
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BANKING
HSBC
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ENGINEERING
GE
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FOOD
Unilever
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Most of the global economy comprises products that are produced by very big organizations that are complex with multiple factories in many different locations, and supply chains that span the globe. It is not easy to understand these companies in a way that makes it possible to hold them accountable for their behavior. Nevertheless, despite their complexity, they are able to communicate their profit performance to investors, but not their social impact nor their environmental impact, even where these are material. This has to change.
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PRODUCTS ENABLE A DECENT QUALITY OF LIFE
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Food - Vegetables
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Food - Meat
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Housing
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Clothes
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Mobility
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Recreation
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More consumption correlates to a better quality of life up to a certain level. Beyond that level more consumption may well have negative consequences, as for example too much food may result in obesity and diabetes or worse.
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PRODUCT LIFE CYCLE
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---- 1 --->
NATURE
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---- 2 --->
LOGISTICS
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---- 3 --->
PRODUCTION
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---- 4 --->
CONSUMPTION
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---- 5 --->
DEGRADATION
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---- 6 --->
RECYCLING
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NATURE
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SEA
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STEEL
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EATING
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WASTE
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RECYCLING
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NATURE
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ROAD
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REFINING
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CONSUMING
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LANDFILL
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REUSE
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EXTRACTION
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RAIL
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AGRICULTURE
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DRIVING
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POLLUTION
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REGENERATION
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<<< ----
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<<< ----
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<<< ----
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<<< ----
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<<< ----
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<<< ----
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- Products enable consumption that improves quality of life.
- The production of products is a critical economic activity and source of profit for companies.
- Production and products are only sustainable if they do not degrade the environment. Most modern industrial process are catastrophically unsustainable.
- Smarter processes are needed together with smarter products, smarter consumers and systems to enable a circular economic model.
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(1) NATURE AND NATURAL SYSTEMS ARE FOUNDATIONAL
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SUN
NATURE
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NATURE
BIODIVERSITY
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Everything starts with nature ... but the importance of nature is ignored in most of economics, business management and politics. Natural ecosystems make clean water and air, maintain the productivity of soil, stabilize the climate and so much more.
Energy from the sun provides the energy for all sorts of natural production, as well as agrticulture for food production
There are complex networks that link the lifecycles of animals (including fish) and plants and are essential for life to go on season after season.
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(2) LOGISTICS ... ESSENTIAL FOR OPTIMIZING TRADE
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SHIPS
SEAPORTS
TRAINS
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AIRCRAFT
AIRPORTS
TRUCKS
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Optimizing prduction performance cannot be done without efficient logistics. All aspects of logistics have become more efficient in the past 70 years. Equipment (ships, trains, cranes and trucks are all more efficient, infrastructure is more efficient and information technology is more efficient.
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(3) ECONOMIC ORGANIZATIONS PRODUCE AN ABUNDANCE OF GOODS
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FARMING
MINING
STEEL
SEA
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ENERGY
RAIL
REFINING
ROAD
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The scale and complexity of the modern global economy is difficult to comprehend. It has been enabled since the start of the industrial revolution by impressive improvements in technology and this has accelerated over the years.
Customers have very little knowledge about the complete life cycles of the goods and services they buy and use. They know about price, and the messages associated with the product and the brand, but not much more.
Most companies optimize for profit and to generate wealth. Some companies know about the social and environmental impacts ... good and bad ... associated with the supply chains for what they produce and sell, but this information is closely held to the extent that it is known because almost all production is unsustainable into the future.
The flow of goods and services at the present level of economic activity is dangerously unsustainable, and will become more so as countries like India and China become more affluent and consumption increases. It is estimated that if everyone on planet earth had the lifestyle associated with the USA, it would require between 7 and 10 planets to be sustainable.
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(4) THE CONSUMPTION OF PRODUCTS IS CENTRAL TO QUALITY OF LIFE
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EATING
MOBILITY
HEALTH
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CONSUMING
RELAXATION
EDUCATION
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In a world of shortage, more is better ... and for most of history this has been the reality, but less so in modern times where productivity enables an abundance of material goods and services. The limiting factor is no longer production but the ability of nature to sustain such production without catastrophic degradation.
Quality of life improves when there is an abundance of goods and services from which to choose ... however too much results in negative impacts like obesity and diabetis.
For companies, more production and more sales results in more profits while at the same time more corporate responsibility results in more costs and less profits. Advertising is mainly about getting more sales, no matter the misinformation.
It is time for better metrics!
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(5) WASTE, INDUSTRIAL DETRITUS AND ENVIRONMENTAL DEGRADATION
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AIR POLLUTION
WATER USE
LANDFILL
FLOODS
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GHGs
POLLUTION
PLASTIC
HURRICANES
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The modern economy produces a massive amount of waste. There is waste at every stage of the produce life cycle, and the costs of this waste are ignored in conventional financial management accounting.
Industry has a history of doing the minimum to reduce air pollution both as regards human health and the impact on the environment.
Agriculture and industry are using more water than the natural replenishment, and there are massive flows of polluted water into most major watersheds
Industry has also embraced the use of plastic ... including single use plastic ... without doing much about the way the plastic pollutes both land and seas and kills wildlife.
In addition industry has had little interest in ensuring that important ecosystems remain viable, both as regards biodiversity and also climate stability. Many scientists now consider that the climate situation has morphed into a climate crisis.
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(6) TRUE SUSTAINABILITY MEANS A REGENERATIVE ECONOMIC SYSTEM
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HEALTHY SOIL
URBAN FARM
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PRAIRIE STRIPS
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A sustainable socio-envireo-economic system requires a ,
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