In the Shift

Economist and business expert John Kay has a new book out called Obliquity.  The main message is that we have got too caught up in numbers and measurement, and this has left us pursuing goals whose main justification seems to be that they can be spelt out in equations.  Kay calls this ‘bogus rationalisation’ and gives as an example the UN Human Development Index, a list of countries ranked by their human development scores: scores that have been arrived at using the equation below:

And from this we can tell Canada is more developed than Afghanistan, although the relative positions of Afghanistan and Monte Carlo aren’t known as Monte Carlo doesn’t provide the right kind of data.

According to Kay even the World Economic Forum is waking up to the idea that measurement madness is hampering our efforts at transformation because it locks us in a paradigm where if you can’t measure it it doesn’t count.  Ironically, I was presenting at a WEF meeting last month, and mentioned that one of the distractions I saw in companies’ attempts to develop sustainability strategies was this fixation on measurable targets – to which the response was, ‘Well, we have to measure things.’

Things.  Anything.  It’s as if we’ll get fidgety fingers if we can’t find new ways to understand the world using that calculator function on our PDAs.  But as Einstein said, “Everything that can be counted does not necessarily count; everything that counts cannot necessarily be counted.”  Lots of people cite that quote, and then leave it hanging in the air as if there’s nothing else we can do but carry on counting anyway.

But measurement as an indicator of an activity’s value and worth is not a harmless distraction.  It is dangerous.  It becomes an end in itself.  It becomes an end that overtakes the purpose of the enterprise.  Take for example some of the leading business-related sustainability initiatives such as the Forest Stewardship Council or the Roundtable for Sustainable Palm Oil.  These are both wide-sweeping attempts to get their respective industries to engage in responsible natural resource management, and they’ve both enjoyed a fair amount of success in what are hugely challenging sectors.  But over time their overwhelming focus has come to be on measurement – through sustainability audits, verification, certification and so on.

Yet can one really measure all the elements that contribute to sustainability in these industries?  Can one measure what a sustainable indigenous community is (even if the auditor had a couple of years rather than a day or so)?  Can one measure the degree to which workers, growers, communities and all of the other local stakeholders feel about the way the resource is managed?  Is the auditor being asked to measure that notoriously difficult quality – happiness?

My feeling is (and since the 1990s I’ve been involved in a number of these types of certification/auditing/labeling initiatives) that they have become the victim of Kay’s bogus rationalisation.  It is true that difficult/impossible to measure elements still get included.  But that’s the problem.  Because they can’t be measured properly, these elements get discounted during the very process that seems to be recognising them.  Meanwhile, the measurement process moves on, giving an elevated status to elements because they can be counted and included in equations, and not because they necessarily matter.

It will be a huge task to put in place auditing and verification processes for all of the different aspects of sustainability that apply in a decarbonised economy.  It’s one reason why the accountancy firms salivate at the thought of battling climate change.  But we could end up wasting huge amounts of useless energy coming up with worthless equations that satisfy our need to count but contribute nothing to either our understanding or our management of sustainability issues.