Corporate profit ... social pain

In 2008, as demand for crude oil increased worldwide, crude oil prices hit record levels ... and so also did the reported corporate profit of the major (Western) oil companies. This is perfectly understandable ... most of the production is based on investments made long ago at lower costs and gas pump prices have increased in sympathy with the crude oil prices.

But, prior to Community Accountancy, there have been no systems of metrics to address the cost to society of higher gas prices ... and even though it is recognized that there is social pain, in the traditional working of the economy, there is no incentive or mechanism for corporate gain to be matched against social pain.

Understanding has both a technical dimension and a human dimension ... they are both important. If there is understanding of the behavior of all the key metrics ... then it is possible to move towards an optimization of performance. At the moment there is optimization, but it is all about profit optimization and not about achieving an optimized balance of profit reward and social progress. There is technical expertise, but nothing in the analysis that explicitly looks at social value, nor the various aspects of the human dimension.

The technical metrics are cost, prices and values ... and the derivatives of these which are productivity, profits and value adding. The human dimension is an integral part of some of the behavior of these items, but there are other factors where human behavior is particularly important. What are the incentives that help to drive decisions ... and what can be done to bring an ethical dimension to the decisions being made that affect society.