Collective narcissism

From Wikipedia, the free encyclopedia

https://en.wikipedia.org/wiki/Collective_narcissism 

Collective narcissism (or group narcissism) extends the concept of individual narcissism onto the social level of self. It is a tendency to exaggerate the positive image and importance of a group the individual belongs to, be it defined by, religion, social class, race, political stance, language group, nationalism, employment status, education level or cultural values– i.e. the ingroup. While the classic definition of narcissism focuses on the individual, collective narcissism asserts that one can have a similar excessively high opinion of a group, and that a group can function as a narcissistic entity. Collective narcissism is related to ethnocentrism. However, ethnocentrism primarily focuses on self-centeredness at an ethnic or cultural level, while collective narcissism is extended to any type of ingroup, beyond just cultures and ethnicities. While ethnocentrism is an assertion of the ingroup's supremacy, collective narcissism is a self-defensive tendency to invest unfulfilled self-entitlement into a belief about ingroup's uniqueness and greatness. Thus, the ingroup is expected to become a vehicle of actualisation of frustrated self-entitlement. When applied to a national group, collective narcissism is similar to nationalism: a desire for national supremacy. Positive overlap between ingroup satisfaction and collective narcissism suppresses collective narcissistic intergroup hostility.

Development of the concept

In Sigmund Freud's 1922 study Group Psychology and the Analysis of the Ego, he noted how every little canton looks down upon the others with contempt, as an instance of what would later to be termed Freud's theory of collective narcissism. Wilhelm Reich and Isaiah Berlin explored what the latter called the rise of modern national narcissism: the self-adoration of peoples. "Group narcissism" is described in a 1973 book entitled The Anatomy of Human Destructiveness by psychologist Erich Fromm. In the 1990s, Pierre Bourdieu wrote of a sort of collective narcissism affecting intellectual groups, inclining them to turn a complacent gaze on themselves. Noting how people's desire to see their own groups as better than other groups can lead to intergroup bias, Henri Tajfel approached the same phenomena in the seventies and eighties, so as to create social identity theory, which argues that people's motivation to obtain positive self-esteem from their group memberships is one driving-force behind in-group bias. The term "collective narcissism" was highlighted anew by researcher Agnieszka Golec de Zavala who created the Collective Narcissism Scale and developed research on intergroup and political consequences of collective narcissism. People who score high on the Collective Narcissists Scale agree that their group's importance and worth are not sufficiently recognised by others and that their group deserves special treatment. They insist that their group must obtain special recognition and respect.

The Scale was modelled on the Narcissistic Personality Inventory. However, collective and individual narcissism are modestly correlated. Only collective narcissism predicts intergroup behaviours and attitudes. Collective narcissism is related to vulnerable narcissism (individual narcissism manifesting as distrustful and neurotic interpersonal style), and grandiose narcissism (individual narcissism manifesting as exceedingly self-aggrandising interpersonal style) and to low self-esteem. This is in line with theorising of Theodore Adorno who proposed that collective narcissism motivated support for the Nazi politics in Germany and was a response to undermined sense of self-worth.

Characteristics and consequences

Collective narcissism is characterized by the members of a group holding an inflated view of their ingroup which requires external validation. Collective narcissism can be exhibited by an individual on behalf of any social group or by a group as a whole. Research participants found that they could apply statements of the Collective Narcissism Scale to various groups: national, ethnic, religious, ideological, political, students of the same university, fans of the same football team, professional groups and organizations Collectively narcissistic groups require external validation, just as individual narcissists do. Organizations and groups who exhibit this behavior typically try to protect their identities through rewarding group-building behavior (this is positive reinforcement).

Collective narcissism predicts retaliatory hostility to past, present, actual and imagined offences to the ingroup and negative attitudes towards groups perceived as threatening. It predicts constant feeling threatened in intergroup situations that require a stretch of imagination to be perceived as insulting or threatening. For example, in Turkey, collective narcissists felt humiliated by the Turkish wait to be admitted to the European Union. After a transgression as petty as a joke made by a Polish celebrity about the country's government, Polish collective narcissists threatened physical punishment and openly rejoiced in the misfortunes of their "offender". Collective narcissism predicts conspiracy thinking about secretive malevolent actions of outgroups.

Individual/Collective Narcissism Equivalencies

Individual	Collective
I wish people would recognize my authority	I wish other people would recognize the authority of my group
I have natural talent for influencing people	My group has all predispositions to influence others
If I ruled the world it would be a much better place	If my group ruled the world it would be a much better place
I am an extraordinary person	My group is extraordinary
I like to be the center of attention	I like when my group is the center of attention
I will never be satisfied until I get what I deserve	I will never be satisfied until my group gets all that it deserves
I insist upon getting the respect that is due to me	I insist upon my group getting the respect that is due to it
I want to amount to something in the eyes of the world	I want my group to amount to something in the eyes of the world
People never give me enough recognition for the things I've done	Not many people seem to understand the full importance of my group

Collective vs. individual

There are several connections, and intricate relationships between collective and individual narcissism, or between individual narcissism stemming from group identities or activities. No single relationship between groups and individuals, however, is conclusive or universally applicable. In some cases, collective narcissism is an individual's idealization of the ingroup to which it belongs, while in another the idealization of the group takes place at a more group-level, rather than an instillation within each individual member of the group. In some cases, one might project the idealization of himself onto his group, while in another case, the development of individual-narcissism might stem from being associated with a prestigious, accomplished, or extraordinary group.

An example of the first case listed above is that of national identity. One might feel a great sense of love and respect for one's nation, flag, people, city, or governmental systems as a result of a collectively narcissistic perspective. It must be remembered that these feelings are not explicitly the result of collective narcissism, and that collective narcissism is not explicitly the cause of patriotism, or any other group-identifying expression. However, glorification of one's group (such as a nation) can be seen in some cases as a manifestation of collective narcissism.

In the case where the idealization of self is projected onto ones group, group-level narcissism tends to be less binding than in other cases. Typically in this situation the individual—already individually narcissistic—uses a group to enhance his own self-perceived quality, and by identifying positively with the group and actively building it up, the narcissist is enhancing simultaneously both his own self-worth, and his group's worth. However, because the link tends to be weaker, individual narcissists seeking to raise themselves up through a group will typically dissociate themselves from a group they feel is damaging to their image, or that is not improving proportionally to the amount of support they are investing in the group.

Involvement in one's group has also been shown to be a factor in the level of collective narcissism exhibited by members of a group. Typically a more involved member of a group is more likely to exhibit a higher opinion of the group. This results from an increased affinity for the group as one becomes more involved, as well as a sense of investment or contribution to the success of the group. Also, another perspective asserts that individual narcissism is related to collective narcissism exhibited by individual group members. Personal narcissists, seeing their group as a defining extension of themselves, will defend their group (collective narcissism) more avidly than a non-narcissist, to preserve their own perceived social standing along with their group's. In this vein, a problem is presented; for while an individual narcissist will be heroic in defending his or her ingroup during intergroup conflicts, he or she may be a larger burden on the ingroup in intragroup situations by demanding admiration, and exhibiting more selfish behavior on the intragroup level—individual narcissism.

Conversely, another relationship between collective narcissism and the individual can be established with individuals who have a low or damaged ego investing their image in the well-being of their group, which bears strong resemblance to the "ideal-hungry" followers in the charismatic leader-follower relationship. As discussed, these ego-damaged group-investors seek solace in belonging to a group; however, a charismatic, strong leader is not always requisite for someone weak to feel strength by building up a narcissistic opinion of their own group.

The charismatic leader-follower relationship

Another sub-concept encompassed by collective narcissism is that of the "Charismatic Leader-Follower Relationship" theorized by political psychologist Jerrold Post. Post takes the view that collective narcissism is exhibited as a collection of individual narcissists, and discusses how this type of relationship emerges when a narcissistic charismatic leader, appeals to narcissistic "ideal-hungry" followers.

An important characteristic of the leader follower-relationship are the manifestations of narcissism by both the leader and follower of a group. Within this relationship there are two categories of narcissists: the mirror-hungry narcissist, and the ideal-hungry narcissist—the leader and the followers respectively. The mirror-hungry personality typically seeks a continuous flow of admiration and respect from his followers. Conversely, the ideal-hungry narcissist takes comfort in the charisma and confidence of his mirror-hungry leader. The relationship is somewhat symbiotic; for while the followers provide the continuous admiration needed by the mirror-hungry leader, the leader's charisma provides the followers with the sense of security and purpose that their ideal-hungry narcissism seeks. Fundamentally both the leader and the followers exhibit strong collectively narcissistic sentiments—both parties are seeking greater justification and reason to love their group as much as possible.

Perhaps the most significant example of this phenomenon would be that of Nazi Germany. Adolf Hitler's charisma and polarizing speeches satisfied the German people's hunger for a strong leader. Hitler's speeches were characterized by their emphasis on "strength"—referring to Germany—and "weakness"—referring to the Jewish people. Some have even described Hitler's speeches as "hypnotic"—even to non-German speakers—and his rallies as "watching hypnosis on large scale". Hitler's charisma convinced the German people to believe that they were not weak, and that by destroying the perceived weakness from among them (the Jews), they would be enhancing their own strength—satisfying their ideal-hungry desire for strength, and pleasing their mirror-hungry charismatic leader.

Intergroup aggression

Collective narcissism has been shown to be a factor in intergroup aggression and bias. Primary components of collectively narcissistic intergroup relations involve aggression against outgroups with which collective narcissistic perceive as threatening. Collective narcissism helps to explain unreasonable manifestations of retaliation between groups. A narcissistic group is more sensitive to perceived criticism exhibited by outgroups, and is therefore more likely to retaliate. Collective narcissism is also related to negativity between groups who share a history of distressing experiences. The members of a narcissistic ingroup are likely to assume threats or negativity towards their ingroup where threats or negativity were not necessarily implied or exhibited. It is thought that this heightened sensitivity to negative feelings towards the ingroup is a result of underlying doubts about the greatness of the ingroup held by its members.

Similar to other elements of collective narcissism, intergroup aggression related to collective narcissism draws parallels with its individually narcissistic counterparts. An individual narcissist might react aggressively in the presence of humiliation, irritation, or anything threatening to his self-image. Likewise, a collective narcissist, or a collectively narcissistic group might react aggressively when the image of the group is in jeopardy, or when the group is collectively humiliated.

A study conducted among 6 to 9 year-olds by Judith Griffiths indicated that ingroups and outgroups among these children functioned relatively identical to other known collectively narcissistic groups in terms of intergroup aggression. The study noted that children generally had a significantly higher opinion of their ingroup than of surrounding outgroups, and that such ingroups indirectly or directly exhibited aggression on surrounding outgroups.

Ethnocentrism

Collective narcissism and ethnocentrism are closely related; they can be positively correlated and often shown to be coexistent, but they are independent in that either can exist without the presence of the other. In a study conducted by Boris Bizumic, some ethnocentrism was shown to be an expression of group-level narcissism. It was noted, however, that not all manifestations of ethnocentrism are narcissistically based, and conversely, not all cases of group-level narcissism are by any means ethnocentric.

It is suggested that ethnocentrism, when pertaining to discrimination or aggression based on the self-love of one's group, or in other words, based on exclusion from one's self-perceived superior group is an expression of collective narcissism. In this sense, it might be said the collective and group narcissism overlap with ethnocentrism depending on given definitions, and the breadth of their acceptance.

In the world

In general, collective narcissism is most strongly manifested in groups that are "self-relevant", like religions, nationality, or ethnicity. As discussed earlier, phenomena such as national identity (nationality) and Nazi Germany (ethnicity and nationality) are manifestations of collective narcissism among groups that critically define the people who belong to them.

In addition to this, the collective narcissism that a group may already possess is likely to be exacerbated during conflict and aggression. And in terms of cultural effects, cultures that place an emphasis on the individual are apparently more likely to see manifestations of perceived individual greatness projected onto social ingroups existing within that culture. Also, and finally, narcissistic groups are not restricted to any one homogenous composition of collective or individually collective or individual narcissists. A quote from Hitler almost ideally sums the actual nature of collective narcissism as it is realistically manifested, and might be found reminiscent of almost every idea presented here: "My group is better and more important than other groups, but still is not worthy of me". Although, this is inconsistent with the interpretation given to collective narcissism by Golec de Zavala and colleagues. Those authors suggest collective narcissists invest their vulnerable self-worth in the exaggerated image of their group and therefore cannot distance themselves from the group through which they achieve self-importance.

Balance of nature

From Wikipedia, the free encyclopedia

https://en.wikipedia.org/wiki/Balance_of_nature 

The balance of nature (also known as ecological balance) is a theory that proposes that ecological systems are usually in a stable equilibrium or homeostasis, which is to say that a small change (the size of a particular population, for example) will be corrected by some negative feedback that will bring the parameter back to its original "point of balance" with the rest of the system. The balance is sometimes depicted as easily disturbed and delicate, while other times it is inversely portrayed as powerful enough to correct any imbalances by itself. The theory may apply where populations depend on each other, for example in predator-prey systems, or relationships between herbivores and their food source. It is also sometimes applied to the relationship between the Earth's ecosystem, the composition of the atmosphere, and the world's weather.

The Gaia hypothesis is a controversial hypothesis which asserts that living beings interact with Earth to form a complex system which self-regulates to maintain the balance of nature.

The theory that nature is permanently in balance has been largely discredited by scientists working in ecology, as it has been found that chaotic changes in population levels are common. During the later half of the twentieth century, the "balance" theory was superseded by catastrophe theory and chaos theory. Nevertheless, the idea maintains popularity amongst the general public.

History of the theory

Herodotus commented on the wonderful relationship between predator and prey species

The concept that nature maintains its condition is of ancient provenance; Herodotus commented on the wonderful relationship between predator and prey species, which remained in a steady proportion to one another, with predators never excessively consuming their prey populations. The "balance of nature" concept once ruled ecological research, as well as once governing the management of natural resources. This led to a doctrine popular among some conservationists that nature was best left to its own devices, and that human intervention into it was by definition unacceptable. The validity of a "balance of nature" was already questioned in the early 1900s, but the general abandonment of the theory by scientists working in ecology only happened in the last quarter of that century when studies showed that it did not match what could be observed among plant and animal populations.

Predator-prey interactions

Predator-prey populations tend to show chaotic behavior within limits, where the sizes of populations change in a way that may appear random but is, in fact, obeying deterministic laws based only on the relationship between a population and its food source illustrated by the Lotka–Volterra equation. An experimental example of this was shown in an eight-year study on small Baltic Sea creatures such as plankton, which were isolated from the rest of the ocean. Each member of the food web was shown to take turns multiplying and declining, even though the scientists kept the outside conditions constant. An article in the journal Nature stated: "Advanced mathematical techniques proved the indisputable presence of chaos in this food web ... short-term prediction is possible, but long-term prediction is not."

Human intervention

Although some conservationist organizations argue that human activity is incompatible with a balanced ecosystem, there are numerous examples in history showing that several modern-day habitats originate from human activity: some of Latin America's rain forests owe their existence to humans planting and transplanting them, while the abundance of grazing animals in the Serengeti plain of Africa is thought by some ecologists to be partly due to human-set fires that created savanna habitats.

One of the best-known and often misunderstood examples of ecosystem balance being enhanced by human activity is the Australian Aboriginal practice of "fire-stick farming". This uses low-intensity fire when there is sufficient humidity to limit its action, to reduce the quantity of ground-level combustible material, to lessen the intensity and devastation of forest fires caused by lightning at the end of the dry season. Several plant species are adapted to fire, some even requiring its extreme heat to germinate their seeds.

Continued popularity of the theory

Despite being discredited among ecologists, the theory is widely held to be true by the general public, conservationists and environmentalists, with one author calling it an "enduring myth". Environmental and conservation organizations such as the WWF, Sierra Club and Canadian Wildlife Federation continue to promote the theory, as do animal rights organizations such as PETA.

Kim Cuddington considers the balance of nature to be a "foundational metaphor in ecology", which is still in active use by ecologists. She argues that many ecologists see nature as a "beneficent force" and that they also view the universe as being innately predictable; Cuddington asserts that the balance of nature acts as a "shorthand for the paradigm expressing this worldview".

At least in Midwestern America, the "balance of nature" idea was shown to be widely held by both science majors and the general student population. In a study at the University of Patras, educational sciences students were asked to reason about the future of ecosystems which suffered human-driven disturbances. Subjects agreed that it was very likely for the ecosystems to fully recover their initial state, referring to either a 'recovery process' which restores the initial 'balance', or specific 'recovery mechanisms' as an ecosystem's inherent characteristic. In a 2017 study, Ampatzidis and Ergazaki discuss the learning objectives and design criteria that a learning environment for non-biology major students should meet to support them challenge the "balance of nature" idea. In a 2018 study, the same authors report on the theoretical output of a design research study, which concerns the design of a learning environment for helping students challenge their beliefs regarding the balance of nature and reach an up-to-date understanding about ecosystems' contingency.

In popular culture

The balance of nature (referred to as "the circle of life") is a major theme of the 1994 film, The Lion King. In one scene, the character Mufasa describes to his son Simba how everything exists in a state of delicate balance.

The character Agent Smith, in the 1999 film The Matrix, describes humanity as a virus, claiming that humans fail to reach an equilibrium with their surrounding environment; unlike other mammals.

The titular character of the 2014 film Godzilla fights other sea monsters known as "MUTOs" in a bid to restore the balance of nature.

In the 2018 film, Avengers: Infinity War, the villain Thanos' home planet Titan has been destroyed by the overexploitation of resources, leading him to seek the restoration of balance to the universe by eliminating half of all living beings.

Environmental accounting

From Wikipedia, the free encyclopedia

https://en.wikipedia.org/wiki/Environmental_accounting 

Environmental accounting is a subset of accounting proper, its target being to incorporate both economic and environmental information. It can be conducted at the corporate level or at the level of a national economy through the System of Integrated Environmental and Economic Accounting, a satellite system to the National Accounts of Countries (among other things, the National Accounts produce the estimates of Gross Domestic Product otherwise known as GDP).

Environmental accounting is a field that identifies resource use, measures and communicates costs of a company’s or national economic impact on the environment. Costs include costs to clean up or remediate contaminated sites, environmental fines, penalties and taxes, purchase of pollution prevention technologies and waste management costs.

An environmental accounting system consists of environmentally differentiated conventional accounting and ecological accounting. Environmentally differentiated accounting measures effects of the natural environment on a company in monetary terms. Ecological accounting measures the influence a company has on the environment, but in physical measurements.

Reasons for use

There are several advantages environmental accounting brings to business; notably, the complete costs, including environmental remediation and long term environmental consequences and externalities can be quantified and addressed.

More information about the statistical system of environmental accounts are available here: System of Integrated Environmental and Economic Accounting.

Subfields

Environmental accounting is organized in three sub-disciplines: global, national, and corporate environmental accounting, respectively. Corporate environmental accounting can be further sub-divided into environmental management accounting and environmental financial accounting.

• Global environmental accounting is an accounting methodology that deals areas includes energetics, ecology and economics at a worldwide level.
• National environmental accounting is an accounting approach that deals with economics on a country's level.

Internationally, environmental accounting has been formalised into the System of Integrated Environmental and Economic Accounting, known as SEEA. SEEA grows out of the System of National Accounts. The SEEA records the flows of raw materials (water, energy, minerals, wood, etc.) from the environment to the economy, the exchanges of these materials within the economy and the returns of wastes and pollutants to the environment. Also recorded are the prices or shadow prices for these materials as are environment protection expenditures. SEEA is used by 49 countries around the world.

• Corporate environmental accounting focuses on the cost structure and environmental performance of a company.
• Environmental management accounting focuses on making internal business strategy decisions. It can be defined as:

"..the identification, collection, analysis, and use of two types of information for internal decision making:

1) Physical information on the use, flows and fates of energy, water and materials (including wastes) and

2) Monetary information on environmentally related costs, earnings and savings."

As part of an environmental management accounting project in the State of Victoria, Australia, four case studies were undertaken in 2002 involving a school (Methodist Ladies College, Perth), plastics manufacturing company (Cormack Manufacturing Pty Ltd, Sydney), provider of office services (a service division of AMP, Australia wide) and wool processing (GH Michell & Sons Pty Ltd, Adelaide). Four major accounting professionals and firms were involved in the project; KPMG (Melbourne), Price Waterhouse Coopers (Sydney), Professor Craig Deegan, RMIT University (Melbourne) and BDO Consultants Pty Ltd (Perth). In February 2003, John Thwaites, The Victorian Minister for the Environment launched the report which summarised the results of the studies.

These studies were supported by the Department of Environment and Heritage of the Australian Federal Government, and appear to have applied some of the principles outlined in the United Nations Division for Sustainable Development publication, Environmental Management Accounting Procedures and Principles (2001).

• Environmental financial accounting is used to provide information needed by external stakeholders on a company’s financial performance. This type of accounting allows companies to prepare financial reports for investors, lenders and other interested parties.

• Certified emission reductions (CERs) accounting comprises the recognition, the non-monetary and monetary evaluation and the monitoring of Certified emission reductions (CERs) and GHGs (greenhouse gases) emissions on all levels of the value chain and the recognition, evaluation and monitoring of the effects of these emissions credits on the carbon cycle of ecosystems. 

Companies specialised in Environmental Accounting

• NEMS AS

Examples of software

• EHS Data's Environmental and Sustainability Accounting and Management System
• Emisoft's Total Environmental Accounting and Management System (TEAMS)
• NEMS's NEMS Accounter

Examples of software as a service

• Greenbase Online Environmental Accountancy

Total cost of ownership

From Wikipedia, the free encyclopedia

https://en.wikipedia.org/wiki/Total_cost_of_ownership 

Total cost of ownership (TCO) is a financial estimate intended to help buyers and owners determine the direct and indirect costs of a product or system. It is a management accounting concept that can be used in full cost accounting or even ecological economics where it includes social costs.

For manufacturing, as TCO is typically compared with doing business overseas, it goes beyond the initial manufacturing cycle time and cost to make parts. TCO includes a variety of cost of doing business items, for example, ship and re-ship, and opportunity costs, while it also considers incentives developed for an alternative approach. Incentives and other variables include tax credits, common language, expedited delivery, and customer-oriented supplier visits.

Use of concept

TCO, when incorporated in any financial benefit analysis, provides a cost basis for determining the total economic value of an investment. Examples include: return on investment, internal rate of return, economic value added, return on information technology, and rapid economic justification.

A TCO analysis includes total cost of acquisition and operating costs, as well as costs related to replacement or upgrades at the end of the life cycle. A TCO analysis is used to gauge the viability of any capital investment. An enterprise may use it as a product/process comparison tool. It is also used by credit markets and financing agencies. TCO directly relates to an enterprise's asset and/or related systems total costs across all projects and processes, thus giving a picture of the profitability over time.

Computer and software industries

TCO analysis was popularized by the Gartner Group in 1987. The roots of this concept date at least back to the first quarter of the twentieth century. Many different methodologies and software tools have been developed to analyze TCO in various operational contexts.

TCO is applied to the analysis of information technology products, seeking to quantify the financial impact of deploying a product over its life cycle. These technologies include software and hardware, and training.

Technology deployment can include the following as part of TCO:

• Computer hardware and programs
  • Network hardware and software
  • Server hardware and software
  • Workstation hardware and software
  • Installation and integration of hardware and software
  • Purchasing research
  • Warranties and licenses
  • License tracking/compliance
  • Migration expenses
  • Risks: susceptibility to vulnerabilities, availability of upgrades, patches and future licensing policies, etc.
• Operation expenses
  • Infrastructure (floor space)
  • Electricity (for related equipment, cooling, backup power)
  • Testing costs
  • Downtime, outage and failure expenses
  • Diminished performance (i.e. users having to wait, diminished money-making ability)
  • Security (including breaches, loss of reputation, recovery and prevention)
  • Backup and recovery process
  • Technology/user training
  • Audit (internal and external)
  • Insurance
  • Information technology personnel
  • Corporate management time
• Long term expenses
  • Replacement
  • Future upgrade or scalability expenses
  • Decommissioning

In the case of comparing TCO of existing versus proposed solutions, consideration should be put toward costs required to maintain the existing solution that may not necessarily be required for a proposed solution. Examples include cost of manual processing that are only required to support lack of existing automation, and extended support personnel.

Facilities and built environment

Total cost of ownership can be applied to the structure and systems of a single building or a campus of buildings. Pioneered by Doug Christensen and the facilities department at Brigham Young University starting in the 1980s, the concept gained more traction in educational facilities in the early 21^st century.

The application of TCO in facilities goes beyond the predictive cost analysis for a new building’s “first cost” (planning, construction and commissioning), to factor in a variety of critical requirements and costs over the life of the building:

• replacement of energy, utility, and safety systems;
• continual maintenance of the building exterior and interior and replacement of materials;
• updates to design and functionality;
• and recapitalization costs.

A key objective of planning, constructing, operating, and managing buildings via TCO principals is for building owners and facility professionals to predict needs and deliver data-driven results.  TCO can be applied any time during the life of a facility asset to manage cost inputs for the life of the structure or system into the future.

Developing standards for TCO in facilities

APPA, an ANSI Accredited Standards Developer, published APPA 1000-1 – Total Cost of Ownership for Facilities Asset Management (TCO) – Part 1: Key Principles as an American National Standard in December 2017. 

APPA 1000-1 provides financial officers, facility professionals, architects, planners, construction workforce, and operations and maintenance (O&M) personnel the foundation of a standardized and holistic approach to implementing TCO key principles. Implementation of TCO key principles can improve decision making, maximizing financial strategies over the life of an asset, starting at the planning and design stage and extends to the end of the asset's life.

APPA 1000-2, slated for publication in 2019, will focus on implementation and application of key TCO principals in facility management.

Transportation industry

The TCO concept is easily applicable to the transportation industry. For example, the TCO defines the cost of owning an automobile from the time of purchase by the owner, through its operation and maintenance to the time it leaves the possession of the owner. Comparative TCO studies between various models help consumers choose a car to fit their needs and budget.

Some of the key elements incorporated in the cost of ownership for a vehicle include:

• Depreciation costs
• Fuel costs
• Insurance
• Financing
• Repairs
• Fees and taxes
• Maintenance costs
• Opportunity costs
• Downtime costs

Environmental full-cost accounting

From Wikipedia, the free encyclopedia

https://en.wikipedia.org/wiki/Environmental_full-cost_accounting 

Environmental full-cost accounting (EFCA) is a method of cost accounting that traces direct costs and allocates indirect costs by collecting and presenting information about the possible environmental, social and economical costs and benefits or advantages – in short, about the "triple bottom line" – for each proposed alternative. It is also known as true-cost accounting (TCA), but, as definitions for "true" and "full" are inherently subjective, experts consider both terms problematical.

Since costs and advantages are usually considered in terms of environmental, economic and social impacts, full or true cost efforts are collectively called the "triple bottom line". Many standards now exist in this area including Ecological Footprint, eco-labels, and the United Nations International Council for Local Environmental Initiatives approach to triple bottom line using the ecoBudget metric. The International Organization for Standardization (ISO) has several accredited standards useful in FCA or TCA including for greenhouse gases, the ISO 26000 series for corporate social responsibility coming in 2010, and the ISO 19011 standard for audits including all these.

Because of this evolution of terminology in the public sector use especially, the term full-cost accounting is now more commonly used in management accounting, e.g. infrastructure management and finance. Use of the terms FCA or TCA usually indicate relatively conservative extensions of current management practices, and incremental improvements to GAAP to deal with waste output or resource input.

These have the advantage of avoiding the more contentious questions of social cost.

Concepts

Full-cost accounting embodies several key concepts that distinguish it from standard accounting techniques. The following list highlights the basic tenets of FCA.

Accounting for:

1. Costs rather than outlays (see explanation below);
2. Hidden costs and externalities;
3. Overhead and indirect costs;
4. Past and future outlays;
5. Costs according to lifecycle of the product.

Costs rather than outlays

Expenditure of cash to acquire or use a resource. A cost is the cash value of the resource as it is used. For example, an outlay is made when a vehicle is purchased, but the cost of the vehicle is incurred over its active life (e.g., ten years). The cost of the vehicle must be allocated over a period of time because every year of its use contributes to the depreciation of the vehicle's value.

Hidden costs

The value of goods and services is reflected as a cost even if no cash outlay is involved. One community might receive a grant from a state, for example, to purchase equipment. This equipment has value, even though the community did not pay for it in cash. The equipment, therefore, should be valued in an FCA analysis.

Government subsidies in the energy and food production industries keep true costs low through artificially cheap product pricing. This price manipulation encourages unsustainable practices and further hides negative externalities endemic to fossil fuel production and modern mechanized agriculture.

Overhead and indirect costs

FCA accounts for all overhead and indirect costs, including those that are shared with other public agencies. Overhead and indirect costs might include legal services, administrative support, data processing, billing, and purchasing. Environmental costs as indirect costs include the full range of costs throughout the life-cycle of a product (Life cycle assessment), some of which even do not show up in the firm's bottom line.  It also contains fixed overhead, fixed administration expense etc.

Past and future outlays

Past and future cash outlays often do not appear on annual budgets under cash accounting systems. Past (or upfront) costs are initial investments necessary to implement services such as the acquisition of vehicles, equipment, or facilities. Future (or back-end) outlays are costs incurred to complete operations such as facility closure and postclosure care, equipment retirement, and post-employment health and retirement benefits.

Examples

Waste management

The State of Florida uses the term full-cost accounting for its solid waste management. In this instance, FCA is a systematic approach for identifying, summing, and reporting the actual costs of solid waste management. It takes into account past and future outlays, overhead (oversight and support services) costs, and operating costs.

Integrated solid waste management systems consist of a variety of municipal solid waste (MSW) activities and paths. Activities are the building blocks of the system, which may include waste collection, operation of transfer stations, transport to waste management facilities, waste processing and disposal, and sale of byproducts. Paths are the directions that MSW follows in the course of integrated solid waste management (i.e., the point of generation through processing and ultimate disposition) and include recycling, composting, waste-to-energy, and landfill disposal. The cost of some activities is shared between paths. Understanding the costs of MSW activities is often necessary for compiling the costs of the entire solid waste system, and helps municipalities evaluate whether to provide a service itself or contract out for it. However, in considering changes that affect how much MSW ends up being recycled, composted, converted to energy, or landfilled, the analyst should focus the costs of the different paths. Understanding the full costs of each MSW path is an essential first step in discussing whether to shift the flows of MSW one way another.

Benefits

Identify the costs of MSW management

When municipalities handle MSW services through general tax funds, the costs of MSW management can get lost among other expenditures. With FCA, managers can have more control over MSW costs because they know what the costs are.

See through the peaks and valleys in MSW cash expenditures

Using techniques such as depreciation and amortization, FCA produces a more accurate picture of the costs of MSW programs, without the distortions that can result from focusing solely on a given year's cash expenditures.

Explain MSW costs to citizens more clearly

FCA helps you collect and compile the information needed to explain to citizens what solid waste management actually costs. Although some people might think that solid waste management is free (because they are not billed specifically for MSW services), others might overestimate its cost. FCA can result in "bottom line" numbers that speak directly to residents. In addition, public officials can use FCA results to respond to specific public concerns.

Adopt a business-like approach to MSW management

By focusing attention on costs, FCA fosters a more businesslike approach to MSW management. Consumers of goods and services increasingly expect value, which means an appropriate balance between quality and cost of service. FCA can help identify opportunities for streamlining services, eliminating inefficiencies, and facilitating cost-saving efforts through informed planning and decision-making.

Develop a stronger position in negotiating with vendors

When considering privatization of MSW services, solid waste managers can use FCA to learn what it costs (or would cost) to do the work. As a result, FCA better positions public agencies for negotiations and decision-making. FCA also can help communities with publicly run operations determine whether their costs are competitive with the private sector.

Evaluate the appropriate mix of MSW services

FCA gives managers the ability to evaluate the cost of each element of their solid waste system, such as recycling, composting, waste-to-energy, and landfilling. FCA can help managers avoid common mistakes in thinking about solid waste management, notably the error of treating avoided costs as revenues.

Fine-tune MSW programs

As more communities use FCA and report the results, managers might be able to "benchmark" their operations to similar communities or norms. This comparison can suggest options for "re-engineering" current operations. Furthermore, when cities, counties, and towns know what it costs to manage MSW independently, they can better identify any savings that might come from working together.

Food and Agriculture

Over the last ten years there has been considerable attention for Full Cost Accounting (FCA) or True Cost Accounting (TCA) in the field of food and agriculture. In 2013 and 2016, the Sustainable Food Trust organised two conferences on True Cost Accounting in food and farming, in the UK and the USA respectively. The FAO published two studies in 2014 and 2015 with a TCA-analysis of the impact of food wastage ("Food wastage footprint: full cost accounting") and another TCA-analysis of the total impact of world food production on Natural Capital ("Natural Capital Impacts in Agriculture"). In the first report, the FAO comes to the conclusion that the yearly hidden impact of food wastage on Natural Capital amounts to USD 700 billion while the hidden impact on social capital amounts to USD 900 billion dollars. In the second report, the FAO estimates the environmental damage of the world food production at USD 2330 billion per year.

Motives for adoption

Various motives for adoption of FCA/TCA have been identified. The most significant of which tend to involve anticipating market or regulatory problems associated with ignoring the comprehensive outcome of the whole process or event accounted for. In green economics, this is the major concern and basis for critiques of such measures as GDP. The public sector has tended to move more towards longer term measures to avoid accusations of political favoritism towards specific solutions that seem to make financial or economic sense in the short term, but not longer term.

Corporate decision makers sometimes call on FCA/TCA measures to decide whether to initiate recalls, practice voluntary product stewardship (a form of recall at the end of a product's useful life). This can be motivated as a hedge against future liabilities arising from those who are negatively affected by the waste a product becomes. Advanced theories of FCA, such as Natural Step, focus firmly on these. According to Ray Anderson, who instituted a form of FCA/TCA at Interface Carpet, used it to rule out decisions that increase Ecological Footprint and focus the company more clearly on a sustainable marketing strategy.

The urban ecology and industrial ecology approaches inherently advocate FCA — treating the built environment as a sort of ecosystem to minimize its own wastes.

Eco-costs

From Wikipedia, the free encyclopedia

https://en.wikipedia.org/wiki/Eco-costs 

Eco-costs are the costs of the environmental burden of a product on the basis of prevention of that burden. They are the costs which should be made to reduce the environmental pollution and materials depletion in our world to a level which is in line with the carrying capacity of our earth.

For example: for each 1000 kg CO₂ emission, one should invest €116,- in offshore windmill parks (plus in the other CO₂ reduction systems at that price or less). When this is done consequently, the total CO₂ emissions in the world will be reduced by 65% compared to the emissions in 2008. As a result, global warming will stabilise. In short: "the eco-costs of 1000kg CO₂ are € 116,-".

Fig 1: Calculation structure of the eco-costs 2017

Similar calculations can be made on the environmental burden of acidification, eutrophication, summer smog, fine dust, eco-toxicity, and the use of metals, rare earths, fossil fuels, water and land (nature). As such, the eco-costs are 'external costs', since they are not yet integrated in the real life costs of current production chains (Life Cycle Costs). The eco-costs should be regarded as hidden obligations.

The eco-costs of a product are the sum of all eco-costs of emissions and use of resources during the life cycle "from cradle to cradle". The widely accepted method to make such a calculation is called life cycle assessment (LCA), which is basically a mass and energy balance, defined in the ISO 14040, and the ISO 14044 (for the building industry the EN 15804).

The practical use of eco-costs is to compare the sustainability of several product types with the same functionality. The advantage of eco-costs is that they are expressed in a standardized monetary value (€) which appears to be easily understood 'by instinct'. Also the calculation is transparent and relatively easy, compared to damage based models which have the disadvantage of extremely complex calculations with subjective weighting of the various aspects contributing to the overall environmental burden.

The system of eco-costs is part of the bigger model of the ecocosts/value ratio, EVR.

Background information

Fig 2: Eco-costs are based on marginal prevention costs at the no-effect-level (the costs in euro/kg of the technical measure) .

The eco-costs system has been introduced in 1999 on conferences, and published in 2000-2004 in the International Journal of LCA, and in the Journal of Cleaner Production. In 2007 the system has been updated, and published in 2010. The next updates were in 2012 and 2017. It is planned to update the system every 5 years to incorporate the latest developments in science.

The concept of eco-costs has been made operational with general databases of the Delft University of Technology, and is described at www.ecocostsvalue.com.

The method of the eco-costs is based on the sum of the marginal prevention costs (end of pipe as well as system integrated) for toxic emissions related to human health as well as ecosystems, emissions that cause global warming, and resource depletion (metals, rare earths, fossil fuels, water, and land-use). For a visual display of the system see Figure 1.

Marginal prevention costs of toxic emissions are derived from the so-called prevention curve as depicted in Figure 2. The basic idea behind such a curve is that a country (or a group of countries, such as the European Union), must take prevention measures to reduce toxic emissions (more than one measure is required to reach the target). From the point of view of the economy, the cheapest measures (in terms of euro/kg) are taken first. At a certain point at the curve, the reduction of the emissions is sufficient to bring the concentration of the pollution below the so-called no-effect-level. The no-effect-level of CO
2 emissions is the level that the emissions and the natural absorption of the earth are in equilibrium again at a maximum temperature rise of 2 degrees C. The no-effect-level of a toxic emission is the level where the concentration in nature is well below the toxicity threshold (most natural toxic substances have a toxicity threshold, below which they might even have a beneficial effect), or below the natural background level. For human toxicity the 'no-observed-adverse-effect level' is used. The eco-costs are the marginal prevention costs of the last measure of the prevention curve to reach the no-effect-level. See the abovementioned references 4 and 8 for a full description of the calculation method (note that in the calculation 'classes' of emissions with the same 'midpoint' are combined, as explained below).

The classical way to calculate a 'single indicator' in LCA is based on the damage of the emissions. Pollutants are grouped in 'classes', multiplied by a 'characterisation' factor to account for their relative importance within a class, and totalised to the level of their 'midpoint' effect (global warming, acidification, nutrification, etc.). The classical problem is then to determine the relative importance of each midpoint effect. In damage based systems this is done by 'normalisation' (= comparison with the pollution in a country or a region) and 'weighting' (= giving each midpoint a weight, to take the relative importance into account) by an expert panel.

The calculation of the eco-costs is based on classification and characterisation tables as well (combining tables from IPCC, the USEtox model (usetox.org), and tables of the ILCD, however has a different approach to the normalisation and weighting steps. Normalisation is done by calculating the marginal prevention costs for a region (i.e. the European Union), as described above. The weighting step is not required in the eco-costs system, since the total result is the sum of the eco-costs of all midpoints. The advantage of such a calculation is that the marginal prevention costs are related to the cost of the most expensive Best Available Technology which is needed to meet the target, and the corresponding level of Tradable Emission Rights which is required in future. From a business point of view, the eco-costs are the costs of non-compliance with future governmental regulations. Example from the past: NOx emissions of Volkswagen diesel.

The eco-costs have been calculated for the situation in the European Union. It is expected that the situation in some states in the US, like California and Pennsylvania, give similar results. It might be argued that the eco-costs are also an indication of the marginal prevention costs for other parts of the globe, under the condition of a level playing field for production companies.

Eco-costs 2017

The method of the eco-costs 2017 (version 1.6) comprises tables of over 36.000 emissions, and has been made operational by special database for SimaPro: Idematapp 2020 and Idemat2020 (based on LCIs from Ecoinvent V3.5), Agri Footprint, and a database for CES (Cambridge Engineering Selector). Over 10.000 materials and processes are covered in total. Excel look-up tables are provided at www.ecocostsvalue.com.

For emissions of toxic substances, the following set of multipliers (marginal prevention costs) is used in the eco-costs 2017 system:

eco-costs of	equivalent
acidification	8.75 €/kg SOx equivalent
eutrophication	4.17 €/kg phosphate equivalent
ecotoxicity	340.0 €/kg Cu equivalent
human toxicity	3754 €/kg Benzo(a)pyrene equivalent
summer smog (respiratory diseases)	6.0 €/kg NOx equivalent
fine dust	35.0 €/kg fine dust PM2.5
global warming (GWP 100)	0.116 €/kg CO2 equivalent

The characterisation ('midpoint') tables which are applied in the eco-costs 2017 system, are recommended by the ILCD:

• IPPC 2013, 100 years, for greenhouse gasses
• USETOX 2, for human toxicity (carcinogens), and ecotoxicity
• ILCD recommended tables for acidification, eutrification, and photochemical oxidant formation (summer smog)
• UNEP/SETAC 2016, for fine dust PM2.5 (for PM10 the default factors are used of the ILCD Midpoint+)

In addition to abovementioned eco-costs for emissions, there is a set of eco-costs to characterize the 'midpoints' of resource depletion:

• eco-costs of abiotic scarcity (metals, including rare earth, and energy carriers)
• eco-costs of land-use change (based on loss of biodiversity, of vascular plants and mammals, used for eco-costs of tropical hardwood)
• eco-costs of water scarcity (based on the Baseline Water Stress indicator - BWS - of countries)
• eco-costs of landfill

The abovementioned marginal prevention costs at midpoint level can be combined to 'endpoints' in three groups, plus global warming as a separate group:

eco-costs of human health	= the sum of carcinogens, summer smog, fine dust
eco-costs of ecosystems	= the sum of acidification, eutrophication, ecotoxicity
eco-costs of resource scarcity	= the sum of abiotic scarcity, land-use, water, and land-fill
eco-costs of global warming	= the sum of CO2 and other greenhouse gases (the GWP 100 table)
total eco-costs	= the sum of human health, ecosystems, resource scarcity and global warming

Since the endpoints have the same monetary unit (e.g. euro, dollar), they are added up to the total eco-costs without applying a 'subjective' weighting system. This is an advantage of the eco-costs system (see also ISO 14044 section 4.4.3.4 and 4.4.5). So called 'double counting' (ISO 14044 section 4.4.2.2.3) is avoided. The eco-costs system is in compliance with ISO 14008 (“Monetary valuation of environmental impacts and related environmental aspects”), and uses the ‘averting costs method’, also called ‘(marginal) prevention costs method’ (see section 6.3).

The issue of the 'plastic soup' is dealt with in the midpoint 'use of energy carriers' (in products). In the calculation of the marginal prevention costs (i.e. the eco-costs) the price of feedstock for plastics, diesel and gasoline, is based on the system alternative of substitution by 'second generation' oil from biomass (pyrolysis of agricultural waste, wood harvesting waste, or algae), and producing bio-degradable plastics from it. By this substitution, the increase of plastic soup is stopped. However, the problem of the plastic soup that exists already is not resolved by this prevention measure.

The eco-costs of global warming (also called eco-costs of carbon footprint) can be used as an indicator for the carbon footprint. The eco-costs of resource scarcity can be regarded as an indicator for 'circularity' in the theory of the circular economy. However, it is advised to include human toxicity and eco-toxicity, and include the eco-costs of global warming in the calculations on the circular economy as well. The eco-costs of global warming are required to reveal the difference between fossil-based products and bio-based products, since biogenic CO₂ is not counted in LCA (biogenic CO₂ is part of the natural recycle loop in the biosphere). Therefore, total eco-costs can be regarded as a robust indicator for cradle-to-cradle calculations in LCA for products and services in the theory of the circular economy. Since the economic viability of a business model is also an important aspect of the circular economy, the added value of a product-service system should be part of the analysis. This requires the two dimensional approach of Eco-efficient Value Creation  as described at the Wikipedia page on the model of the ecocosts/value ratio, EVR.

The Delft University of Technology has developed a single indicator for S-LCA as well, the so-called s-eco-costs, to incorporate the sometimes appalling working conditions in production chains (e.g. production of garments, mining of metals). Aspects are the low minimum wages in developing countries (the "fair wage deficit"), the aspects of "child labour" and extreme poverty", the aspect of "excessive working hours", and the aspect of "OSH (Occupational Safety and Health)". The s-eco-costs system has been published in the Journal of Cleaner Production.

Prevention costs versus damage costs

Prevention measures will decrease the costs of the damage, related to environmental pollution. The damage costs are in most cases the same (or a bit higher) compared to the prevention costs. So the total effect of prevention measures on our society is that it results in a better environment at no extra costs.

Discussion

There are many 'single indicators' for LCA. Basically, they fall into three categories:

• single issue
• damage based
• prevention based

The best known 'single issue' indicator is the carbon footprint: the total emissions of kg CO₂, or kg CO₂ equivalent (taking methane and some other greenhouse gasses into account as well). The advantage of a single issue indicator is, that its calculation is simple and transparent, without any complex assumptions. It is easy as well to communicate to the public. The disadvantage is that is ignores the problems caused by other pollutants and it is not suitable for cradle-to-cradle calculations (because materials depletion is not taken into account).

The most common single indicators are damage based. This stems from the period of the 1990s, when LCA was developed to make people aware of the damage of production and consumption. The advantage of damage based single indicators is, that they make people aware of the fact that they should consume less, and make companies aware that they should produce cleaner. The disadvantage is that these damage based systems are very complex, not transparent for others than who make the computer calculations, need many assumptions, and suffer from the subjective normalization and weighting procedure as last step, to combine the 3 scores for human health, ecosystems and resource depletion. Communication of the result is not easy, since the result is expressed in 'points' (scientific attempts to express the results in money were not very successful so far, because of methodological flaws and uncertainties).

Prevention based indicators, like the system of the eco-costs, are relatively new. The advantage, in comparison to the damage based systems, is that the calculations are relatively easy and transparent, and that the results can be explained in terms of money and in measures to be taken. The system is focused on the decision taking processes of architects, business people, designers and engineers. The advantage is that it provides 1 single endpoint in euro's, without the need of normalization and weighting. The disadvantage is that the system is not focused on the fact that people should consume less.

The eco-costs are calculated for the situation of the European Union, but are applicable worldwide under the assumption of a level playing field for business, and under the precautionary principle. There are two other prevention based systems, developed after the introduction of the eco-costs, which are based on the local circumstances of a specific country:

• In the Netherlands, 'shadow prices' have been developed in 2004 by TNO/MEP on basis of a local prevention curve: it are the costs of the most expensive prevention measure required by the Dutch government for each midpoint. It is obvious that such costs are relevant for the local companies, but such a shadow price system doesn't have any meaning outside the Netherlands, since it is not based on the no-effect-level
• In Japan, a group of universities have developed a set of data for maximum abatement costs (MAC, similar to the midpoint multipliers of the eco-costs as given in the previous section), for the Japanese conditions. The development of the MAC method started in 2002 and has been published in 2005. The so-called avoidable abatement cost (AAC) in this method is comparable to the eco-costs.

Five available databases

In line with the policy of the Delft University of Technology to bring LCA calculations within reach of everybody, open access excel databases (tables) are made available on the internet, free of charge. Experts on LCA who want to use the eco-costs as a single indicator, can download the full database for Simapro (the Eco-costs Method as well as the Idematapp LCIs), when they have a Simapro licence. Engineers, designers and architects can have databases, free of charge, for CES and ArchiCAD software, provided that they have a licence for the software.

The following databases are available:

• excel tables on www.ecocostsvalue.com, tab data (look-up tables for designers and engineers):
  • an excel table with data on emissions and materials depletion (more than 35.000 substances), see
  • an excel table on products and processes, based on LCIs of Ecoinvent, Idemat, and Agri Footprint (more than 10,000 lines), only for students at the campus, see
• an import SimaPro database for the method and an import SimaPro database for Idemat LCIs (software for LCA specialists. www.simapro.com) for people who have a Simapro licence
• a database for Cambridge Engineering Selector, Level 2 (software for designers and engineers who have a software licence)
• a dataset for ArchiCAD (software for architects)
• the IdematApp for Sustainable Materials Selection (available in the App Store of Apple and in the Google Play store). See for more information www.idematapp.com.