By Anne RinaudoWednesday 14 Mar 2018Open House InterviewsFinance and BusinessReading Time: 2 minutes
Listen: Economist Nicholas Gruen in Conversation with Stephen O’Doherty
In a world where the answer is, inevitably, about the money, can we develop a better economic model? New Zealand Prime Minister, Jacinda Ahern thinks so.
In a break with traditional government budgetary measures the impetus in New Zealand will shift from a single focus ion economic growth to a more holistic, triple bottom line approach.
The new approach can be summarized as Profit, Place and People. It considers the positives and negatives of a project on the basis of the actual dollar cost (Profit.) the environmental impact (Place) and what happens to communities (People).
New Zealand is the latest country to try this approach, which sceptics say has never before been successfully adopted. Can the new Government of Jacinda Adern make it work?
Instead of deciding to allocate budget spending on a particular item based simply on the dollars, the triple bottom line draws on other important considerations that have traditionally not rated in big picture decision making. For instance, a project that could be considered too pricey based on dollars outlaid alone, may get a green light if it delivers good environmental outcomes or provides jobs for a struggling community.
It is a move away from consideration of the traditional Gross Domestic Product measure as a stand alone guide for Government funding. Interestingly, the triple bottom line shares some common ground with biblical ideas of community good, environmental stewardship and social justice.
To explain more about the concept, Open House turned to economist Nicholas Gruen, founder and CEO of Lateral Economics. It is a fascinating and engaging conversation that ranges across some very big social questions and philosophical ponderings.