Sustainable Development



"Sustainable Development" WESTON WAY April/May 1995


Part 1 -- Message from Management

Part 2 -- Sustainable Development: To Better Understand the Concept WESTON founder and Chairman Emeritus Roy F. Weston offers an approach for identifying the constraints and depicting the means for implementing sustainable development. Attaining and maintaining a necessary balance among resource accessibility, the requirements and capacity to meet requirements, plus maximizing economic effectiveness and efficiency, is essential for establishing community requirements for meeting survival "needs" and "wants".

Part 3 -- Metrics of Human Terrestrial Systems Management for Food Creation/

Consumption - Two Examples

Ben Tencer, retired WESTON Executive Vice President, traces the natural evolution of land-based biomass creation systems and the development of human management variants to increase output. The dramatic effect of the use of fossil fuel energy derivatives on food system energy input/output ratios is examined in terms of natural system analytics and metrics. In the process, several of the philosophical terms examined by Mr. Weston are quantified, and the unsustainable U.S. and world practices are discussed.

Part 4 -- Sustainable Development: Integration of the Free Market Economic System into the Natural Economics System

Mr. Weston summarizes the pertinent attributes of the natural economics system and the free market system and discusses a means for effectively and efficiently integrating them to ultimately achieve sustainable development. He shows how the integration of a full-cost accounting and free market pricing system into the natural economics system will provide a scientifically and morally sound economics system.

Part 5 -- Sustainable Development Makes Good Business Sense

Andrew L. Ullman and James A. Fava, both of WESTON's Management Systems Division, explain how to integrate environmental improvement systems, objectives, business targets and practices into an enterprise to help ensure good decisionmaking.

Part 6 -- ISO 1400: A Building Block for Redefining Environmental Protection and Moving Toward Sustainable Development

Robert B. Biggs, Manager of WESTON's Environmental and Health Sciences Division, and Glenn K. Nestel, who is responsible for the company's Management Systems Project Development Department, explain the importance of the emerging ISO 1400 environmental standards and how they promise to reshape the way the private and the public sectors view environmental protection.

Part 7 -- Sustainable Development: The Economic Model of the Future Roy F. Weston, P.E., D.E.E., Chairman Emeritus, Roy F. Weston, Inc.

(Reprinted with permission from "The Weston Way," April/May 1995, Roy F. Weston, 1 Weston Way, West Chester, PA 19380 USA, Roy F. Weston, Phone 610-701-3551, Internet Address:

"Sustainable Development" WESTON WAY April/May 1995
Part 1 of 8


Sustainable Development: "Depoliticking" the Environment and Making It a Matter of Natural Economics

by A. Frederick Thompson, Ph.D., P.E., Chairman of the Board, Roy F. Weston, Inc.

As we acknowledge the 25th anniversary of Earth Day, the environment remains a hotly debated topic. State and federal legislators alike seem to be easily caught up in the specifics. But, truth is, concern for environmental quality has never been the exclusive province of any political affiliation -- Democrat, Republican, American, G7 or Third World.

Here, in the United States, environmental advances and disasters occurred over the past 30 years regardless of political administrations. In the 1960s, for example, there was a general awakening of the American environmental consciousness with passage of the first clean air and water quality legislation. It was also a time for expanded use of open pits, ponds and lagoons for storing and presumably treating hazardous waste.

The 1970s saw the dawning of the ecology movement, creating the U.S. Environmental Protection Agency and enacting strict laws closing the loop on water, air and land pollution control. But, Love Canal and Three-Mile Island made the news.

Cleanup priorities accelerated during the 1980s, spurred by Superfund legislation and public emphasis on human health and safety. The decade's environmental downsides included the Exxon Valdez oil spill, Bhopal and Chernobyl.


Also during the 1980s, the concept of sustainable development was introduced. It gained global visibility at the Earth Summit in Rio de Janeiro in 1992 by focusing worldwide attention, and some degree of passion, on our planet's environmental frailties.

The debate, dialogue and political discourse aside, what happened in Rio was a unanimous, international agreement on the prominent role sustainable development plays in our global progress. Without it, all concurred, there is simply no future.

But what is it? As many definitions emerged as there were Earth Summit conferees. And, how do we get it to work? Again, a multitude of hypotheses.

Briefly paraphrased from Our Common Future, a 1987 publication of the United Nations World Commission on Environment and Development, sustainable development essentially means meeting our present needs and aspirations without compromising the ability of future generations to meet theirs.


But, often overlooked is a crucial preface that specifies a process of change in order for sustainable development to work. Specifically, changes are required in the direction of our financial investment, in the orientation of our technology, in the allocation of world resources and in our basic economic mindset. You need not be an environmental scientist to understand the folly of our present course. We are exhausting nonrenewable resources like fossil fuels and other minerals used as products or by-products. Simultaneously, on some continents we're over-harvesting our renewable assets, consuming, for example, the forest for the trees.

Becoming obvious, too, is the degrading environmental quality around the world -- PCBs, CFCs, auto emissions, pesticides, nuclear waste, just to name a few catalysts. All contribute to increasingly deleterious environmental responses: global warming, acid rain, the extinction of species and greater risks to our own health and safety.

Also clouding our environmental future is the accelerating world population, as well as the increasing disparity in living standards - - from household to household and from nation to nation.

Sustaining, let alone raising, standards of living is environmentally resource-intensive. Continuing many of the current practices we employ to satisfy our present needs and aspirations clearly endangers the ability of future generations to meet theirs.


To reverse that course, we need to emulate the economics of nature. It's the straightest path toward stimulating the crucial changes needed to make sustainable development work.

Nature is the quintessential supply sider, with its resource reserves not readily available on demand. Through systematic recycling and reuse, moreover, nature doesn't push its inventory of renewable and nonrenewable resources beyond critical limits for sustainability. It's a natural economics system with "rules of the game" that govern the interrelationships among all things -- energy, matter, space, time and life -- and their most efficient and effective use.

Far-thinking business and government people have already begun to recognize the priorities those rules demand in their daily undertakings. They are evolving from an unlimited to a limited resources mindset that champions pollution prevention and waste minimization as good business. And, they know it's good not only for today's bottom line, but also for long-term sustainability.


This is a pivotal decade for igniting the momentum sustainable development needs and deserves. Admittedly, the very principles of a free market economy may help assure its continued journey over time.

But, right now, we need a National Sustainable Development Policy that would make sure our free market rules are scientifically and morally sound. Furthermore, that policy would focus crucial public and private sector attention on positively changing perspectives and encouraging behaviors consistent with a sustainable society.

Leadership is the accelerator to catch up with a world already in a logarithmic phase of environmental change. There's little time left for political rhetoric or electioneering -- locally, nationally or internationally.

It is time, though, for unilateral statesmanship. For us and for our future generations, it's a matter of natural economics.


Pioneering the industry since 1957, WESTON has become a leading international environmental management, design and consulting firm working in the public and private sectors to preserve, protect and restore vital air, land and water resources. Nearly 2,800 WESTON people specialize in analytical laboratory services, engineering, facility construction and operations, remediation and large-scale turnkey programs. Based in West Chester, Pa., WESTON has 60 offices and laboratories across the U.S. with international operations in Europe and the Asian Pacific.

(Reprinted from "The Weston Way," April/May 1995, Roy F. Weston, Inc., 1 Weston Way, West Chester, PA 19380 USA, Roy F. Weston, Phone 610-701-3511, Internet Address:

"Sustainable Development" WESTON WAY April/May 1995
Part 2 of 8

To Better Understand the Concept


Roy F. Weston, P.E., DEE,
Chairman Emeritus
Roy F. Weston, Inc.


The concept of sustainable development was introduced in a 1987 report entitled Our Common Future by the World Commission on Environment and Development of the United Nations. This report has been referred to as "the Brundtland Report" in honor of the Chairperson, Dr. Gro Harlem Brundtland, Prime Minister of Norway.

The Commission defined sustainable development as: "...development that meets the needs of the present without compromising the ability of future generations to meet their own needs."1

For most of us, development means progress or change for the better. Development involves maximizing the efficiency of resource allocation to meet needs - which is the dominant paradigm in economics at the present time. Thus, for most of us, sustainable development is, and should be, an economic concept.

The Commission integrated sustainable development into the world's economy as follows: Sustainable development is "... a process of change in which the exploitation of resources, the direction of investments, the orientation of technological development ... institutional change and the ability of the biosphere to absorb the effects of human activities are consistent with future as well as present needs."

The Commission cautioned, however, that "sustainable development can be pursued more easily when population size is stabilized at a level consistent with the productive capacity of the ecosystem." This statement expanded the role of economics in meeting the needs of the current "reality."

Observations that led to a description of "reality" and the call for sustainable development are summarized in Table 1 (at the end of this paper).

Sustainable development holds humankind responsible for existing circumstances and challenges humankind to accept responsibility for instituting the changes necessary to attain sustainability. This challenge was reinforced at the United Nations Conference on Environment and Development (UNCED) held in Rio de Janeiro in 1992. The conference's principal product (endorsed by the more than 100 heads of state and close to 10,000 delegates) was an agenda for change, called Agenda 21, a description of perceived needs and proposed actions to bring humankind into harmony with the finite resources of the earth by the middle of the twenty-first century.

This concept of sustainable development consists of the following four interrelated but separate ideas:

* Meeting both present and future needs -- which establishes the goal for sustainability.

* Meeting needs -- which defines the goal for development.

* Maintaining consistency between population size and ecosystem productive capacity -- which recognizes that there are limits and requirements for balance.

* Implementing a process of change -- which acknowledges that the definition of needs and the requirements for attaining a sustainable balance will change with situations, conditions and time.

The concept is open-ended because people have different needs to survive, different aspirations for their standards of living and quality of life, and different ecosystem, productive and absorptive capacities. Therefore, to better understand the concept of sustainable development, it is necessary to think in terms of global objectives, local goals, the circumstances under which individuals live and make their living, and their capacity to adapt to and change their circumstances to their advantage.

The concept presumes that the purpose of the human race is to sustain human life on Earth. In that case, the goal of the different peoples would be to continually meet survival needs and aspiration exactions.

There are finite requirements to ensure survival under different environmental situations and conditions (i.e., base-case) and more restrictive finite requirements (i.e., exactions) to attain a standard of living and quality of life better than survival. Therefore, I believe that the physical and emotive needs for living and making a living to survive should be the "base case" for all evaluations. In any case, the concept of sustainable development challenges present generations to stabilize their development needs so that they are consistent with the Earth's future, as well as its present productive and absorptive capacities. Because the Earth has finite productive and absorptive capacity, the concept raises issues of equitable allocation of resources among present generations and between present and future generations.


As exemplified by Agenda 21, many of us believe we should recognize the importance of and need for individual action. Unfortunately, in the haste to "do something," people often try to solve the problem before the basic philosophical and technical elements of the problem have been identified and characterized.

We first need to simplify the complex by identifying and characterizing the basic objectives of and the constraints to implementing sustainable development.

I propose a process that can characterize the circumstances, identify the constraints and depict the means by which sustainable development can be implemented. The process approaches sustainable development implementation from a multidisciplinary, interdisciplinary systems perspective. The process can assist each of us in determining how we can become participants.

This paper is restricted to developing an approach for identifying constraints and depicting the means by which sustainable development can be implemented. It does not deal with implementation per se.

I propose a problem-solving approach using personal beliefs (a few of which will be called hypotheses), as well as generally accepted scientific truths and reality, to develop philosophical ideas, guidance principles and an operational definition to aid in better understanding the constraints and solutions to sustainable development. Each hypothesis is presumed to be logical and to represent reality. My challenge is to strive to be holistic and as objective and scientifically sound as I can be in presenting what I believe is reality.

My problem-solving philosophy is:

* All that has occurred, all that exists, and all that is about to be, is logical. (This means that outcomes can be correctly and logically explained when the reality of the circumstances is known.)

* Outcomes are the result of the decisions and/or actions of individuals in response to circumstances. (For this hypothesis to be true, the individual may be any form of energy, matter or life, and the circumstances must include the attributes of the individual, the applicable "rules of the game", and environmental situations and conditions.)

* The circumstances for which sustainable development is to be attained are those of the human individual living on planet Earth. (This statement is presented as a hypothesis because it does not presume that sustainable development is either good or bad or is do- able. It clearly states the limits of the system.)

The proposed approach requires asking and answering the right questions. Two right questions are:

* Why are the circumstances what they are?

* What is required to correct the outcomes of the ineffectiveness and inefficiency of the past and to avoid ineffectiveness and inefficiency in the future?

To confidently predict, I must understand!


Situations and Conditions

Planet Earth consists of a lithosphere, a hydrosphere, an atmosphere and a biosphere. Respectively, the primary constituents of the spheres are solid, liquid and gaseous matter, and matter activated by life. The four spheres are integrated in such a way that life forms inhabit each sphere. In the biosphere, there are life forms that inhabit other life forms. Hereafter, I will refer to the biosphere as the life system.

Planet Earth is a part of a solar system consisting of a sun and nine planets. The sun radiates energy from a nuclear fusion process and that energy actuates the Earth's hydrologic, climatic and life systems. Of the nine planets, only Earth has life as we know it. It is estimated that planet Earth was formed about 4.55 billion years ago and that the situation and conditions on Earth permitted the creation of life about 3.8 billion years ago. Scientists can only speculate about how matter became activated by life. Scientific evidence, however, indicates that first life evolved from microscopic, single-celled individuals to today's hierarchy of plant and animal multicelled life forms. Currently, the number of cells per individual plant or animal may range from one to multiples of tens of trillions. The human individual consists of tens of trillions of cells, needing air (i.e., oxygen), water, food, shelter, energy and other resources to survive.

As I consider a more detailed description of the human circumstance on Earth, I find I am constrained by language and the perceptions associated with language. For instance, I must use the words "individual," "community" and "system." These terms can become confusing because the circumstances of humans on Earth involve interrelationships among individuals, communities and systems, each differing significantly in terms of scale (e.g., number and size) and attributes. Because of this hierarchy of scale and attributes, there can be systems within communities and individuals, and communities within individuals and systems. Consequently, to use these words in a consistent way, I must carefully define the pertinent system, its interacting parts and the "rules of the game." It will require the coining of terms to facilitate unambiguous representation of reality.

Interacting Parts and Rules of the Game

Knowledge of the human circumstance has been acquired over time. Scientists have learned that:

* The human circumstance is associated with the basic resources of energy, matter, space, time and life.

* Energy and mass are mutually interchangeable in accordance with Einstein's mass-energy equation.

* Matter consists of mass, mass consists of elements, and elements are made up of atoms. Atoms are made up of protons, neutrons and revolving satellite electrons. Elements combine to form compounds.

* The total and relative quantity of the different elements that make up planet Earth was established at the time of the Earth's formation. The quantity was finite and is known. The loss of elements to space and their concentration in specific areas through biological and/or physical chemical activity are also known.

* Every life form -- plant and animal -- contains the compound DNA (deoxyribonucleic acid), which provides reproductive capabilities and which combines to form the genes that determine the attributes of the individual life form.

* Energy flow governs the interrelationships among all system components -- from elements and compounds to life. The Earth receives a finite amount of energy from the sun. Energy dissipates in accordance with natural law. This law places limits on the integration of energy, matter and life, in space and time.

These "rules of the game" are self-enforcing. They provide a hierarchy of individuals of different attributes and scale. The interrelationships and interdependencies among these individuals govern all of Earth's circumstances.

Life System Attributes

Evolution from microscopic single-cell life forms to the hierarchy of species we know today was neither smooth nor orderly. Scientists believe that, over time, there were at least five massive global extinctions. The first confirmed massive extinction occurred about 438 million years ago, and the last, about 65 million years ago. The first massive extinction was followed by an explosion in the evolution of new species. The "rules of the game" governing this evolution and present circumstances are self-enforcing, self- organizing and self-regulating. Scale is an ever-present factor influencing outcomes (i.e., size varies from an individual fragment of DNA to an individual consisting of tens of trillions of individual cells).

The life system is composed of communities of individuals. Each individual is a member of a hierarchy of species. Each species is interrelated with and dependent on other species in support of their community. Each species fulfills a role as a producer (plant) or a herbivore, carnivore, scavenger or decomposer (animal) in sustaining life on Earth.

The system is actuated by the individuals within a community. Individuals are opportunists and compete with other individuals to acquire the resources needed to survive and to sustain their species. Each individual must pay a price in energy, time and bother to meet its concerns and requirements (i.e., needs). Routinely, the system permits sacrifice of the individual for the benefit of the community (i.e., selective extinction). The system will permit massive extinction of individuals or the sacrifice of a species if the individuals and species exhaust resources essential to them or otherwise cannot adapt to their situations or conditions.

Massive extinction is part of the quality of life regulation strategy. The life system "rules of the game" sustain life on Earth and achieve the diversity of species (i.e., balance) that will maximize the biomass productivity from accessible resources and environmental conditions and situations.

Attributes of the system that influence attaining the system's objective and maximizing economic effectiveness and efficiency (my definition of the "objective function" for achieving a sustainable society within the systems' constraints) are those of self- organization and self-regulation, as described in Table 2 (at the end of this paper).

It should be obvious that Mother Nature's purpose is to sustain life on Earth. In accordance with her scheme, each individual is born into an organized resource supply system and each is afforded an opportunity to contribute toward sustaining the system. The individual is guaranteed neither long life expectancy nor reproductive opportunity. The individual must adapt to its circumstances, with only the most adaptive (e.g., fittest) surviving to contribute. An implied philosophy appears to be "from each in accordance with ability, to each appropriate to contribution." This system changed the earthly circumstances so that they were acceptable for the human presence.

Human Attributes

There is strong scientific evidence that humans are an integral part of Earth's life system, governed by the same basic physical and life systems' "rules of the game" applicable to other forms of life. Nonetheless, there are obvious differences among different life forms. The primary difference, of course, is that of intellectual capacity. As the Earth's most intellectual species, humans are boundary condition creatures and are obliged to provide their own rules for interpersonal relationships and for adapting to the Earth's circumstances. Like other animal life forms, humans are born with instinctive knowledge and a capacity to acquire knowledge. Humans have a tremendous capacity to learn. They use this attribute to acquire information, to organize it into knowledge and to learn from both personal experiences and the communicated experiences of others.

Over time, humans developed a conscience because, in order to survive, individuals needed community acceptance. For acceptance, they had to pay a price, in terms of energy, time and bother, to meet their concerns and requirements (i.e., needs) and to maximize their satisfaction from their expenditure of time and energy. Humans bother themselves about meeting their requirements and about concerns such as peace and happiness, self-esteem, compatibility with others, freedom, fairness, justice, opportunity, uncertainty and risk. The level of their bother determines their acceptance by others and their capacity to meet their own needs and to contribute toward the welfare of the community. Bother is a differentiator. It differentiates the doers from the non-doers.

Unfortunately, humans strive to gain personal advantage relative to their peers and will take advantage of others. Thus, humans have endeavored to develop codes of moral behavior. Western humans rejected nature's "absolute" (i.e., life or death) system in favor of establishing more humane limits. To date, they have been unsuccessful in establishing and holding to "finite limits" for acceptable behavior. The U.S. culture emphasizes freedom and de- emphasizes adherence to rules with "finite limits." In fact, we have established organizations, like non-profit organizations, and legal systems to challenge such limits.

Humans have the capacity to organize themselves to more efficiently meet their needs. They have established cultures and systems of governance, education and economics. They have established their own "rules of the game" relative to those cultures and systems. The resulting cultures and systems and "rules of the game" have encouraged the discovery of Mother Nature's "rules of the game". Thus, science and technology were born and developed. Through science and technology, in which the rules of the game have finite limits, the productivity of the individual human has been increased by orders of magnitude.

The discovery, characterization and practical application of nature's "rules of the game" have made it possible for humans to enhance their effectiveness and efficiency in the use of the Earth's resources. They have used their knowledge of nature's self-enforcing laws to improve their standard of living and quality of life. However, human attributes; humans' lack of knowledge of interrelationships and interdependencies within the life system; and inconsistencies between human organization and policy, and Mother Nature's organization and "rules of the game", have contributed toward inefficiencies and many of the unsustainable circumstances referred to in Table 1 (at the end of this paper).

It appears that humans have difficulty in agreeing on how issues should be resolved; and even with agreement they are reluctant to change course.

Community indecision on important issues could be based on the lack of clear goals and direction. It is difficult for citizens to take decisionmaking seriously when they cannot see how it fits into a worthy master plan. In the absence of this master plan, each issue is perceived as an opportunity for special interests to jockey for advantage.


The allocation of resources within the dynamic system that has sustained life on Earth requires a viable natural economics system. The human circumstance is that of being a part of that system.

Subsystem "Rules of the Game"

The natural economics system is made up of three subsystems -- physical, life and human. These subsystems are described as follows:

* The physical subsystem is governed by self-enforcing "rules of the game" (e.g., laws of physics and chemistry, and system attributes such as magnetism, gravity, tides, daily and seasonal cycles, climate and weather). These "rules of the game" also govern basic resource transactions and allocations in the life system and its human subsystem.

* The life subsystem is governed by self-organizing and self- regulating "rules of the game," which include the laws of biology, ecology, sociology, psychology, etc. Self-organization establishes the means, and self-regulation balances the quality and quantity of the means, within the constraints of the circumstances, to ensure that the system is sustained.

* The human subsystem includes systems of culture, governance and economics. The physical and life subsystems' laws govern the human subsystem. The human subsystems are also governed by laws drafted by humans, which may be characterized as self-exalting, self-deceiving and self-indulging, when, for example, they designate themselves as the Earth's superior creatures; adhere to a contrived, deficient, economic system; and advocate the "right" of humans to exploit the Earth's natural resources.

We, of the United States, use the democratic system of governance. Our laws of governance tend to micromanage and, generally, are poorly enforced. These laws have avoided making it clear that all people must exercise personal accountability to protect the rights of others if any are to enjoy rights. Our present political system, in my opinion, makes it very difficult to make hard decisions, to develop sound policy and to provide strong leadership.

Our free market economic system is highly self-organizing and self- regulating. In this regard, it is similar to the life system. It is the best "cross cutting" and "integrating" system of human design and may be the most efficient in the world at supplying current wants. The economist's preoccupation with the efficient allocation of resources in the short run, without regard to long-term capacity issues and human propensities, has directly resulted in unacceptable, unsustainable "realities."

The concept of natural economics remedies this condition by proposing that all that happens on planet Earth involves one or more of the basic resources. It proposes that each and every human activity involves energy, matter, time, space or another life, plus the human life attributes of initiative, learning, thought, preference, emotion and morality. Therefore, everything that happens on planet Earth is and should be recognized as a natural economics transaction.

Earth System "Realities"

I have postulated ten planet Earth system realities that should influence human rule-making. These are shown in Table 3 (at the end of this paper).

Natural Economics Impact Assessment

The complex task of maximizing the global system effectiveness and efficiency by actions at the subsystem levels (e.g., nation, industry, firm, citizen communities, individual) leads to the need to design and conduct Natural Economics Impact Assessments for existing unsustainable development conditions and for proposed changes.

Assessments will be structured to the individual and circumstances model, and will require the elements outlined in Table 4 (at the end of this paper).

The process will provide the analytical tools and methods for balancing the effectiveness and efficiency of the segments, within the primary objective of maximizing the natural economics' effectiveness and efficiency of the overall system.

Dynamic modeling would be used as appropriate. Alternative scenarios would be evaluated. Monetary evaluations would be made after the most economically efficient and effective scenarios had been established. The processes will be standardized for like assessments. The Natural Economics Impact Assessment approach forces the process to identify and to ask the right questions. Sustainably correct answers to the right questions make it possible to better understand reality, natural law and the system constraints to implementing sustainable development.


The Earth's life system provides a sustainability model for humans to emulate. Identification of differences between the presumed objectives and goals of the life system and its human subsystem assists in understanding what humans must do to provide a better, yet humane and sustainable, system.

A preliminary assessment of the life system and the human free market economic system reveals significant similarities and differences relative to the potential for attaining sustainable development. Both systems strive to attain their objectives through organization and policy, with strong emphasis on enforcement of "rules of the game". For instance, it is obvious that the objective of the life system is to sustain life on Earth. An obvious goal is to maximize biomass productivity for local and global circumstances. To accomplish this goal, the life system provides the organization to maximize the productivity potential from the circumstances, including keeping essential resources accessible to its economy. This capability has not always been available; it has evolved. Human endeavors at the "base-case" level are covered by this capability. The system produces no residual that is harmful to the community. It accomplishes its objective and goals through strict enforcement of the organization's (i.e., system's) "rules of the game".

Beyond the idea of maximizing personal well-being for the present, which is natural, it is not clear whether a generally accepted human objective exists. In the United States it appears that the national goal is to maximize the creation of wealth, as measured by Gross Domestic Product (GDP), to continually increase GDP, and to distribute created wealth as uniformly as the political process will permit. This is similar to the life system goal. A free market economic system has been developed to achieve these goals. This system emulates the life system. Different skills and processes are used to ensure the completion of tasks essential to the community, and outcomes are dependent on conformance with the "rules of the game".

The system has used the humanp priority propensity to increase the rate of consumption of resources at levels that are orders of magnitude greater than the "base case." This increase in consumption has occurred without establishing the necessary organization to ensure the continued accessibility of resources to the system's economy. In fact, the system's process for establishing price has encouraged wastage and provided a disincentive to keeping essential nonrenewable resources accessible to the economy. Our successes have put us on a fast track toward exhausting our finite resources and toward massive extinction. Discouragingly, human propensities, combined with human intellectual capacity to exploit natural resources, have built a world economy that is highly dependent on the accessibility of a nonrenewable, finite resource that is destroyed when used (i.e., fossil fuels). It is obvious that in the absence of leadership and sound common goals, humans will follow their individual priority propensity. The dilemma is how to provide leadership and common goals in a society with a political system that has failed to provide such leadership.

The drive for the survival of both the nonhuman and human members of the life system is strongly dependent on the individual's reproductive, priority and completive propensities. The life system regulates its quality and quantity outcomes from these propensities by selective and massive extinction. Its members either live off the interest from natural capital -- or die. The life system ensures that every individual -- alive or dead -- contributes toward the well- being of the community. Individual obedience to the "rules of the game" and the need for prudent behavior are absolute. Thus, prevention and living within prudent limits are less costly than the final outcome of illness and extinction.

Human "rules of the game" hold human life sacred regardless of quality or quantity. We strive to postpone selective extinction, and we are outraged by massive extinction. The outcome has been an eight- fold increase in population in 250 years. Also, human "rules of the game" and the group dynamics governing their enforcement, relative to reproduction and death, welfare and crime, have increased the relative size of the population unable to support themselves. The human dilemma is that people are unable to agree upon, establish and enforce freedom-restrictive rules for reproductive behavior, and that the natural outcome from exercising unwise individual freedom can be massive extinction.

Free market enterprises have fostered the development of science and technology which, in turn, have increased human productivity and capacity to extract resources from the environment and to process, use and return resources to the environment. The increased capacity to extract resources has degraded the quality of the environment and decreased the accessibility of resources for future generations. Our growth in production capacity and population has increased the world's Gross National Product about 100 times in the past 250 years. In the United States, the per capita consumption of energy is 60 times the 3,700 kilocalories per day used to sustain our extravagant food consumption life style (base case food consumption is about 2,000 kilocalories per day). Growing metropolitan areas have increased the runoff from rainfall and have depleted wetlands, wildlife habitat and farmland. This development has greatly increased the rate of conversion of solar radiation to heat. There is evidence that global climatic change has increased the violence of hurricanes, tornadoes and other energy-dissipating atmospheric disturbances.

I know of no large city, and only a few countries, that are sustainable from resources within their limits. Thus, equity among peoples requires conservation of all resources acquired through "free" trade.

A preliminary assessment indicates that behavioral change is needed, from the individual to the global population level, to improve economic effectiveness and efficiency and to attain the balance required to meet the needs of sustainable development. Humans have reached the present unsustainable earthly circumstance by behaving naturally. Thus, to avoid unsatisfactory natural outcomes (e.g., massive extinction), humans must determine what unnatural behavior is necessary to avoid such outcomes and to wisely self-impose "rules of the game" for meeting that objective.


Present reality is that the outcomes shown in Table 1 (at the end of this paper) are the result of ignorance, propensities, mismanagement and the consumption of about 80% of the Earth's resource production by about 20% of the Earth's population. The new "reality" is that the other 80% of the Earth's population want to alter their life style such that they will probably consume resources at the same rate as the present 20%.

I believe that the results of Natural Economics Impact Assessments will indicate the wisdom of sustainable development. I believe that humans must recognize that, to maximize their future freedom, standard of living and quality of life, they must self-impose "rules of the game" that will counterbalance the propensities that prevent sustainable development. The new realities are shown in Table 5 (at the end of this paper).


The question is, "What must be done differently, and what must we bother about, to maximize our satisfaction while attaining and maintaining a better and sustainable future?" The question is pointless unless it is presumed that the purpose of human life is to sustain itself on Earth, as part of a viable natural environment. I presume that:

* The purpose of the human species is to sustain human life on Earth, humanely, and

* The objective of the present generation is to attain the capacity required to meet its "needs" and exact its "aspirations," through maximization of natural economics' effectiveness and efficiency in the use of accessible basic resources, without foreclosing the opportunity for future generations to attain an equivalent capacity to meet their own "needs" and exact their own "aspirations."

This kind of an objective forces a systems approach and a recognition of limits and of necessary balances.

On the basis of the new "reality," I endeavored to simplify the complex and to define a global operational strategy for achieving sustainable development. A definition and implementation guidance principles2 were prepared earlier and are shown as a single-page document at the end of this paper.

The defined strategies for achieving sustainable development include the following two concepts:

* Maximize natural economics' effectiveness and efficiency.

* Attain and maintain a necessary balance.

Maximizing natural economics' effectiveness and efficiency in the use of resources is required to achieve the highest productivity and best use among alternative uses and to attain the highest utility from that which is used. Thus, maximizing effectiveness and efficiency can achieve the best use of accessible resources and can better ensure sustainability.

Attaining and maintaining a necessary balance among resource accessibility, the community's requirements and capacity to meet its requirements, plus maximizing economic effectiveness and efficiency, is essential for meeting survival "needs" and exacting aspiration "wants." The necessary aspect of balance is to ensure that requirements to meet survival needs do not exceed resource accessibility or community capacity to meet "base-case" requirements. Such balance is necessary if humans truly believe in the sacredness of human life and aspire to voluntary rather than life system self- regulation of population. Thus, population size, individual requirements, and the mean fitness of the population to meet requirements through personal accountability, the appropriate use of locally accessible resources or the "free" trade acquisition of essential resources become major factors for community decisions in implementing sustainable development.

Sustainable development is more than doing something that is perceived to be good at this time. Sustainable development cannot be attained by using a single formula but only by using a fundamental systems approach. Each set of circumstances and objectives will have its own set of sustainable solutions.

The definition and guidance principles provide fundamental criteria for establishing the direction of a Natural Economics Impact Assessment and for screening the acceptability of sustainability alternatives. Although the foregoing discussion was based on the human individual, the concepts involved can be adapted to any individual and circumstances model. The definition and guidance principles can provide the basis for developing a hierarchy of more detailed assessment criteria.


Humans have endeavored to establish their own "rules of the game". The outcomes from human activities, in accordance with these rules, have not been completely satisfactory. This is because human rules and their enforcement have not appropriately counterbalanced the inconsistencies among human wants, their rules, the rules of nature and reality. Thus, we have an opportunity to change -- an opportunity to harmonize our behavior with reality.

I believe that an understanding of the real requirements of sustainable development can provide that change.

I believe that the approach toward understanding those requirements, as presented herein, is an essential part of the process to determine the changes necessary to achieve sustainable development.

I believe that wise behavior is necessary to achieve sustainable development. Wise behavior includes abiding by self-imposed economic "rules of the game" to manage the human priority and completive propensities, and exercising personal accountability to control the reproductive propensity. Thus, prudent, "unnatural" behavior is necessary to exact human aspirations.

I believe that the most effective instrument for implementing essential change will be an altered free market economic system. The system's self-organization and self-regulation features motivate self- interest decisions and actions that will benefit other members of the system. I believe that the initiation of change toward sustainable development is do-able and will provide greater personal satisfaction, a more effective and stable economy, and a more acceptable and efficient system of governance. I believe that understanding the issues and knowing what to do are not enough -- there must also be a will to act. I believe that building that will requires leadership by "agents of change." I hope that what I have presented will encourage and assist agents of change to bother to understand and initiate sustainable development.

1Quoted from Our Common Future, World Commission on Environment and Development Report to the United Nations General Assembly, Chairperson Gro Harlem Brundtland. Oxford University Press, 1987. 2"Sustainable Development, The Economic Model of the Future, Definition and Guidance Principles," Roy F. Weston, November 1991. Published in "The Weston Way," Summer 1992. Revised and republished in "The Weston Way," September 1993.

Table 1

Conditions Leading to the Call
For Sustainable Development

* Increasing population densities.

* Concentration of populations in urban areas.

* Increasing rates of per capita resource use.

* Overharvesting of renewable resources.

* Exhaustion of nonrenewable resources.

* Mismanagement of natural capital.

* Degradation of environmental quality.

* Extinction of species.

* Greater risks to individual human health, safety and security.

* Increasing disparity in living standards.

* Escalating terrorism, local warfare and threats to national security.

Table 2
Life System Attributes

Self Organization

A life system is a hierarchial system of plant and animal species that are interrelated, interdependent, instinct driven, adaptable, time- dependent and fragile. This system initiates and sustains a food chain, provides diversity in scale and functions, and permits a large disparity among species in their capacity to contribute, but a minimal disparity between individuals of a species in capacity to contribute toward the well-being of the communities. This system has the following features:

* Provides an omnipresence of life, including alternative and redundant means for accomplishing necessary tasks.

* Maximizes biomass productivity from accessible resources through diversity of species in a competitive environment.

* Keeps nonrenewable resources, essential to the survival of individual members, accessible to the system's economy.

* Ensures that the individual, alive or dead, contributes toward the well-being of the community.

* Actuates the system through the drive of the individual members to live, to reproduce (i.e., reproductive propensity), to maximize personal gain from expended effort (e.g., priority propensity), and to adapt to and to change their environmental situations and conditions.


Self-regulation (policy) involves the following:

* Endows individual members with instinctive knowledge and with the capacity to acquire knowledge.

* Reproduces life forms in the likeness of their immediate ancestors with characteristically finite life spans (e.g., mutation).

* Subjects life forms to predators and/or environmental, genetic or microbial disease and accidents (i.e., selective extinction).

* Enforces fully the "rules of the game," including absolute accountability for personal outcomes (e.g., selective and/or massive extinction). (Note: Selective extinction is minimal during the exponential growth phase of life forms).

Table 3
Earth System Realities

* Resources are finite quantitatively and limited spatially.

* The Earth's finite surface area is used to meet geo-physical, climatic, hydrologic cycle and life system requirements, to which humans must adapt.

* Scale influences outcomes as a result of the relative mass and numbers of individuals and the significance of the relationships and dependencies among individuals, communities and systems (e.g., micro- decisions and/or actions, although individually insignificant, collectively determine the outcome; seemingly insignificant dependencies can control outcomes).

* All individuals (inanimate or animate) are born into circumstances over which they had no control. All individual life forms, however, have a capacity to choose and, thereby, to alter their circumstances.

* Like individuals (whether inanimate or animate) are not created equal and will conform to a defined circumstance in a typical probablistic variation from a mean.

* Individuals and systems are constrained by limits and enhanced by balance (e.g., oxygen content of air-saturated water; a balanced aquarium; ignorance and bias preclude wisdom).

* No transaction can occur without a change in the quality or state of energy and the elapse of time.

* Ignorance of the specific outcomes resulting from self-enforcing natural law and materials employed in or wasted into the environment (e.g., materials that are foreign to nature, are hazardous to life, bioconcentrate, mutate disease-producing organisms, convert light energy to heat) may create risk to human well-being.

* Maximization of the natural economics' effectiveness and efficiency of a system, to meet stakeholder objectives, requires a necessary balance among subsystem effectiveness and efficiency outcomes (i.e., maximization of system effectiveness and efficiency requires a clear and definable system objective).

* Status quo cannot persist (e.g., circumstances change).

Table 4
Assessment Requirements

* A statement of the purpose, objective and goals for the proposed change (or existing situation) to be evaluated.

* A broad investigative method to determine the statement's conformance with reality.

* A system and subsystems description, appropriate for the analysis, to include interrelationships, interdependencies, basic energy and matter flows, etc.

* An objective function to include the needs and desires of the identified stakeholders (who themselves are resources).

* The limits and balances that constrain and enhance the analysis and determine the boundaries of the solution space.

* The assessment of the effects of the proposed changes on all of the significant stakeholders.

Table 5
New "Realities"

New "realities" are:

* The world's population continues to increase, and the present "low consuming" 80% of the Earth's population are rapidly increasing their per capita natural resources appetite. Thus, the world is entering a phase of accelerated resources use with a mature technology-production base and a resource base depleted in both quality and quantity.

* The need exists to change human attitude away from that of conquering or fighting nature toward that of adapting to and leveraging the value of the free goods and services that nature provides.

* Prevention is less costly than cure, whether it be environmental protection, preservation of resource stock, floodplain use, earthquake zone use, crime control, sustaining a healthy population or maintaining an effective and efficient economic system.

* Economists rely on the same human propensities to actuate the free market economic system that Mother Nature relies on to grow and then to cull her species.

* The objectives of advocates of system components such as legal, health care and welfare have become inconsistent with the performance capacity of the system as a whole.

* The power of the individual to do harm (through knowledge of science and technology, the general desire for individual freedom and the inadequate moral behavior standards of a few) creates undue risks for communities.

* The need exists to provide incentives for good behavior and disincentives for bad behavior.

* Sustainable development concepts provide a mix of economics and morality that should stimulate education in moral behavior as an economic issue.

(Reprinted from "The Weston Way," April/May 1995,Roy F. Weston, Inc., 1 Weston Way, West Chester, PA 19380 USA, Roy F. Weston, Phone 610- 701-3511, Internet Address:

About Roy F. Weston, Inc.

Pioneering the industry since 1957, WESTON has become a leading international environmental management, design and consulting firm working in the public and private sectors to preserve, protect and restore vital air, land and water resources. Nearly 2,800 WESTON people specialize in analytical laboratory services, engineering, facility construction and operations, remediation and large-scale turnkey programs. Based in West Chester, Pa., WESTON has 60 offices and laboratories across the U.S. with international operations in Europe and the Asian Pacific.

"Sustainable Development" WESTON WAY April/May 1995
Part 3 of 8


Two Examples


Ben Tencer, Ph.D., P.E.(1)
Executive Vice President (Retired)
Roy F. Weston, Inc.


Natural terrestrial systems for biomass creation have evolved over a long period of time.(2) It has been more than 4.5 billion years since our planetary system congealed from a cloud of gas and dust in a remote spiral arm of the Milky Way Galaxy. Terrestrial rock, the initial source for soil creation, dates back 3.8 billion years. Beneficial use of this evolving soil by plants and animals was delayed for another 3 billion years, awaiting land mass colonization by higher plants and the transition of animal life from the sea to land. Seed plants appeared 350 million years ago, at the time that the first animal, the reptile, transitioned to land. Reptiles were equipped with an amniote egg capable of development on dry land. Flowering plants, which today total about two-thirds of all plants, had their evolutionary origins 120 million years ago. Primates, our Order, first appeared 6 to 7 million years ago.

Humans began managing terrestrial systems, in many separate locations on the globe, about 7000 B.C. They started by domesticating animals and cultivating and irrigating grains. Natural system management variants for animal domestication, plant varieties, methods for cultivation, and mechanical methods for irrigation and harvesting all took part in changing agricultural output over the centuries. Even with all of the changes, in England in the 1720s, almost 80% of the population of 5.5 million still directly supported the agricultural process. The number of people alive at any one time was still primarily controlled by nature, i.e., ultimately dictated by the weather.

The turning point in the history of terrestrial management resulted from work conducted in the world's first analytical chemistry laboratory, founded in Germany in 1840 by John Justus von Liebig. Using the contemporary economic theories of Adam Smith, he developed a physical balance sheet model to evaluate agricultural yield and discovered plant requirements for growth, in the form of inorganic fertilizers. The later exploitation of fossil fuels as a source of not only mechanical power, but also feedstock for fertilizers and pesticides, led to explosive changes in yields in the twentieth century.


During the twentieth century, the world population increased from 1.6 billion in 1900 to approximately 6 billion in 1995 and is forecasted to reach more than 8 billion by 2025. The industrialization, sustained material development and feeding the nations of the nineteenth and first half of the twentieth century were based on a world that was still "empty".(3) There appeared to be an almost limitless amount of domestic natural resources per capita, such as land, minerals and fossil energy. In cases where resources were domestically expensive or scarce, there were limitless opportunities in international trade. It seemed that there would never be ecological or economic constraints to continuous expansion that human economics could not resolve.

Contrast this with the "full" world condition that we currently face. In this world, fish catches are not limited by human capital investment in fish-catching paraphernalia, but by the reproductive capacity of fish populations; lumbering is not limited by the availability of saw mills, but by the availability of suitable forests; agricultural output is not limited just by the availability of natural systems, but also by the availability of fossil energy derivatives. Underdeveloped lands with large resource bases and small populations are in short supply. In this world, because advances in technology reduce per unit costs to ultimate depletion, price is no longer a key indicator of scarcity.

Under current circumstances, it is easy to understand why citizens of advanced, industrialized, free market nations have difficulty envisioning "limits and balances" of "rules of the game" associated with sustainability. Pictures from space show our isolation in the planetary system, but to the individual citizen, even with a supersonic transport, the world appears quite large relative to the impacts of his/her micro-decisions and actions.

We are thus left with questions on how to feed the burgeoning human population, without further degrading our natural systems, and on what a "suitable" or "appropriate" quality-of-life food basket looks like.

In his papers on sustainable development(4), Roy F. Weston suggests that to maximize global effectiveness and efficiency by actions at the subsystem level (e.g., agriculture and the food distribution system) is a complex task. Natural Economics Impact Assessments need to be conducted to determine existing unsustainable development conditions and to propose changes. Requirements for conducting an assessment are spelled out in Table 4 and clearly involve a full understanding of the analytic and metric character of the system(s) and subsystem(s) under investigation. Their metrics, and that of the objective function and limits and balances, must be in natural systems terms.

Two examples of the importance of metrics, and preliminary conclusions that can be drawn from them, are discussed in the following sections.


In conducting a Natural Economics Impact Assessment for the U.S. food creation/consumption system, one needs to understand the nature and efficiency of energy flows of both the supply side and the demand side of the system.


The supply side of American nutrients is dominated by wheat, corn and soybeans (with soybeans coming into their own as a high protein animal feed in the mid-twentieth century). Figure 1 (at the end of this paper) displays the changes in energy yields per acre that have occurred in the last 125 years.

At the turn of the century, agricultural yields were not significantly more than those attributed to the Sumerian agriculture of 3000 B.C. "In modern environmental units, wild cereal in Galilee, early millet in China and wheat in Medieval Europe all yielded one- half to three-quarters of a ton per hectare [which is 1.8 to 2.7 million kilo-calories (kcal) per acre]."(5) Small gains in yield were made in the first half of the century. Most of the increased output came from significant acreage released from the feeding of horses and other draft animals.(6)

Starting mid century, with the Green Revolution, yields increased dramatically (6 times for corn, 2 times for wheat and 4 times for soybeans), coinciding with (and driven by) large increases in world and U.S. populations and the changing quality and quantity of nutrient intake.7

By 1990, the kcal output (yield/acre times acres harvested translated to kcal/capita/day) was over 14,000 kcal/capita/day. In a simplistic "base-case" scenario, this raw energy harvest is almost four times the 3,700 kcal/capita/day average nutrient intake for the U.S. population. The human propensity to increase both the quantity and quality of nutrient consumption reduced the energy output "coverage" to a balance of supply and demand.

At the start of this century, commercial energy requirements to support the production and distribution of food energy were minimal; by 1980, they had risen to more than 10 kcal of commercial energy for each kcal of food energy consumed (see Figure 2 at the end of this paper).

The first significant reduction of the rate of increase of the energy ratio occurred in the 1980-1990 time frame. This resulted from changes on both the supply and demand sides. On the supply side, fertilizer and pesticide (and associated water usage) leveled off and has remained flat.9 (Available varieties of grain lack the physiology to effectively use more fertilizer, and the overuse of pesticides had led to pesticide-resistant species.) On the demand side, in the American diet, the proportion of calories from fat decreased from 42% to 40% and the amount from animal sources decreased from 59% to 52%. (As will be shown below, it takes six times more energy to obtain a unit of fat from animal than from vegetal sources.)

The Demand Side

From 1940 to 1990, food energy consumption more than doubled to 925 billion kcal per day, excluding the additional export load placed on U.S. agriculture. This was the result of population growth, which increased from 133 million to 250 million, and the growth in the average nutrient intake from 3,300 kcal/day to 3,700 kcal/day. Figure 3 (at the end of this paper) shows in stark relief the commercial energy inputs to the food system, as both supply and demand increased from 1940 to 1990. (The ratio of the two trends determines the input/output energy ratio of Figure 2.)

Mr. Weston's problem-solving philosophy suggests the requirement for "... asking and answering the right questions...," one of which is, "Why are the circumstances what they are?" The answer relative to the nutrient-demand impact on natural systems begins with an understanding of one of the Earth System Realities, which states that micro-decisions and/or actions, although individually insignificant, collectively determine outcomes -- the result of the relative mass and numbers of individuals and the significance of relationships and dependencies.

A simple picture of the impact of micro-decisions on nutrient intake could be the statement of the U.S. Department of Agriculture (USDA) that "... evidence suggests that a change has occurred in consumer tastes and, hence, in the demand for beef. Interest in convenience and health has altered consumer meat choices. Hamburger that can be prepared quickly accounts for 45% of the beef consumed in 1992, compared with 35% in 1985, and 26% in 1970... Roasts, which take longer to prepare, were down sharply. In addition, a shift has occurred toward eating away from home, especially in fast food places that emphasize hamburgers, fries, and, increasingly in the last decade, chicken and pizza."11

The complete picture of the impact of the micro-decisions and/or actions of the hundreds of millions of U.S. food consumption decisionmakers, on the natural system, is shown in Table 1 (at the end of this paper). U.S. food energy consumption is constructed in terms of the macro-nutrient building blocks (fats, proteins and carbohydrates) and their food group sources (starting with vegetal and animal). This reconstruction of the food demand/consumption pattern for 1990 can be tracked back, step by step, to its natural system supply implications.

First, some salient features of the U.S. food consumption pattern. Of the 3,700 kcal daily food intake of the average U.S. citizen in 1990, 31% came directly as a product or indirectly as a byproduct of the animal kingdom, and the remaining 69% came from raw and processed vegetal sources. In relation to fat intake, 52% came from animal sources and the remaining 48% from vegetal sources. Close to 20% of total food intake (much larger than is necessary or desirable for both human and natural systems' health) was in the form of vegetal sugars and sweeteners.

Energy Flows

As the metrics of energy flows is constructed for the U.S. food supply system, recall the economist who deals in human system monetary terms: "The economist's preoccupation with the efficient allocation of resources in the short run, without regard for long- term carrying capacity issues and human propensities, has directly resulted in unacceptable, unsustainable 'realities'." The reality is that, as energy inputs to the food system increased, the monetary costs for "Food and Tobacco" as a percentage of personal expenditures went from 24% in 1970, to 20% in 1980 and 17% in 1990.13

Energy flow in the nutrient system is easier to follow when described from the top down. The energy flow analysis, however, must be conducted from the bottom up.

Top-Down Process Description

From the top down then, the energy flows necessary to create 1 kcal of human energy intake (using 1990 structural data) start with:

* The input to agriculture of 350 kcal of photosynthetic sunlight and about 3 kcal of commercial energy (over 90% fossil-derived), which in combination with other natural systems (including the photosynthetic process, the hydrologic, nitrogen, carbon), generates more than 7 kcal of field biomass.

* Adjusting for crop residuals left in the field and edible net exports, we arrive at the more than 5 kcal of food, feed and fiber [see (e) in Figure 4 at the end of this paper] that, when augmented by another 7 kcal of commercial energy and processed either through animals or directly to humans, will result in the availability for human consumption of 1 kcal, 31% derived from animal origins and 69% directly from vegetal origins.

Bottom-Up Analysis

The energy flow analysis of Figure 4 (at the end of this paper) starts at (a) with a representative 1 kcal food intake, and the Table 1 (at the end of this paper) determined values of animal at 31% and vegetal at 69%.

To calculate (b), the vegetal feed necessary for the animal kingdom to supply the 0.31 kcal, one must examine each animal species for its feed conversion efficiency related to metabolism (pound of feed/pound of gain), its harvest index (pound of edible biomass/ total weight) and the resultant productive efficiency (kcal feed/kcal edible biomass). Several examples will illustrate the nature of the calculation.

For beef, 12 pounds of vegetal feed input is required to obtain 1 pound of edible biomass; for milk, eggs and poultry, 3 pounds of vegetal feed input is required to obtain 1 pound of edible byproduct. Using the animal nutrient product and byproduct mix from Table 1 and applying the respective productive efficiencies, it takes an average of 4 pounds of vegetal input for each pound of edible biomass. Converting to energy terms, the result is an 8% efficiency of conversion or, to obtain the 0.31 kcal of animal biomass, an input of 3.83 kcal of vegetal material is required. To calculate (c), the vegetal feed necessary to supply the 0.69 kcal, only the harvest index and manufacturing modification are applied, because no prior metabolism occurs. Using an intake consistent with the consumption pattern in Table 1 (at the end of this paper), the result is a 48% efficiency of conversion or, to obtain the 0.69 kcal of vegetal biomass, an input of 1.44 kcal of vegetal material was required.

In (d), the commercial energy inputs required are calculated for the farm and food marketing system. (The USDA refers to all nonfarm food activity as being in the marketing system -- processing, wholesaling, distributing, retailing and preparation at home and away from home.) As a benchmark, it is worth noting that in monetary economic terms, the farmer receives 22 cents out of each dollar spent, with the remaining 78 cents consumed in the marketing system.14 A number of studies have concluded that the farm and food marketing system uses about 17% of total U.S. energy consumption, 5% on the farm and 12% in the marketing system. U.S. energy consumption in 1990 was 20.45x1015 kcal, with 17% at 3.48x1015 kcal. That value, when divided by annual nutrient intake, is consistent with the ratio shown in Figure 2 (at the end of this paper). Distribution of the over 10 kcal/kcal is shown in the hatched areas of Figure 4 (at the end of this paper) (limited data are available to allocate the marketing portion between animal and vegetal; therefore, 50-50 was used).

At (e), an adjustment is made for the net of edible exports and imports. The net value for 1990 was $17 billion (with exports just over $40 billion). Exports of grains and soybeans were 27% of national production. In addition, the United States sold or disposed of, as gifts, 1.72 million metric tons of vegetal oils and 162 thousand metric tons of milk.

900 millions pounds of red meat were net imports (3-4% of total consumption).15 This is a distortion of the systems analysis because the energy inefficiency of vegetal to meat conversion is borne by the exporting country, and the U.S. input/output ratio is understated by that amount. An energy flow analysis of Japan would show how large this distortion can get -- in 1993, the Japanese imported 660,000 tons of beef, just above the domestic production of 595,000 tons.16 The net energy impact for export/import is shown as the difference between the sum of value for (b) and (c) and the value of (e).

At (f), account is taken for crop residues left in the fields after harvest. This averages 25% across the mix of vegetals.

Finally at (g), an estimate is made of the amount of photosynthetic energy needed to create the field biomass. A number of different sources and approaches were taken, and the range of results, on an "efficiency of capture" basis, was from 2-3%. (48 kcal of photosynthetic energy per kcal of biomass was ultimately selected.)


* To produce 1 kcal of nutrient requires a natural system input of 350 kcal of direct solar energy and more than 10 kcal of other energy (primarily fossil, which is simply a concentrated, stored form of solar energy).

* Because no discernible change in photosynthetic sunlight occurred over the last century, the changes in agricultural yields (Figure 1, at the end of this paper) have to be a result primarily of fossil energy inputs in various forms (allowed by a hybrid seed). It is clear that the yield leverage in agriculture for fossil fuels is enormous (recall that less than a third of the 17% of the national energy budget is used on the farm). This places us on the horns of a dilemma: the use of fossil fuels has allowed us to feed a rapidly increasing population (ours and others because the United States is one of the world's largest exporters of grain), but we know it is not sustainable. It is not fanciful to suggest that, without modification in our energy policies, a future tradeoff between eating and driving could be required.

* The "demand" drive for quick and easy nutrients has dramatically increased the energy content of the overhead system -- the marketing system uses more than two-thirds of the 17% of the national energy budget. Resource subsidies and price/value distortions, especially in fossil fuels and irrigation water, allow California, for example, to supply 40% of U.S. produce, even though it takes three times more energy to transport a head of lettuce from California to New York than it takes to grow it. Apples, formerly grown in New York State, are now grown in Washington State, kept in cold storage and then transported to New York for consumption.

* In energy availability terms, the tradeoff of expanding human energy resources and shrinking fossil energy resources requires reexamination.

* The metrics of energy in the nutrient equation is only one of several likely sustainability constraints. Another, for example, is groundwater -- the annual overdraft of the Ogallala aquifer located under the U.S. Midwestern Great Plains "breadbasket" is currently 130% to 160% above replacement, a rate that will cause the aquifer to become nonproductive in 40 years.17 Soil erosion and groundwater pollution are also possible limits to sustainability.


The United States, Canada and Australia stand out in world comparisons as among the few countries that currently have an "overage" of natural resources capital per person. Choices in these currently richly endowed countries can still be made that are within (rather than pressing against) the limits in natural economics' effectiveness and efficiency analyses. This is not true for most of the rest of the countries of the world. As populations and nonrenewable resource consumption continue to grow all over the world, the portions of natural systems that are able to be beneficially and sustainably managed (versus those that are adversely affected) continue to shrink.

Table 2 (at the end of this paper) compares the U.S. and world averages for many key indicators of quality of life and sustainability. Averages always present a problem, especially when the mix goes from countries with great riches to countries with great poverty -- resulting in a bimodal rather than single peak distribution. The Food and Agriculture Organization (FAO) of the United Nations notes the difference between averages in kcal/day food consumption of 3,400 in developed countries and 2,500 in developing countries; between the highest, the Benelux countries at 3,725, and the lowest, the Comoros Islands at 1,760.18

The vegetal-animal source values in Table 2 (at the end of this paper) indicate that rich nations consume a higher proportion of animal biomass and animal byproducts in their diet. The values shown represent more than a 40% difference in the necessary vegetal input to obtain the nutrient mix (based on the 6:1 ratio of animal to vegetal efficiency).

In his papers, Mr. Weston discusses the desirability of having an international government organization act as a "Prudent Person Surrogate" to protect global resources in support of sustainability. Several items in Table 2 (at the end of this paper) fall into this category -- fossil energy, land and water resources -- all critical to maintaining an appropriate quality of life for present and future generations.

Fossil Energy Derivatives

The use of inorganic fertilizers and pesticides, their associated energy-intensive irrigation requirements, and other industrialized energy-intensive agricultural practices are being mirrored in many countries facing population pressures. Agricultural yield analyses indicate that close to 40% of global food production is currently attributable to the Green Revolution application of energy derivatives. The character of the industrial revolution that preceded this latest revolution is also dependent on the use of fossil fuel. More than 90% of the energy that supports the U.S. economic way-of- life is fossil-derived. Table 2 (at the end of this paper) ratios show that the average American consumes more than 5 times the world average for commercial energy and has close to 5 times more machine energy available to him (in pre-industrial societies, the ratio was close to 5:1). The United States currently imports almost 65% of its fossil fuels, and domestic and global reserves continue to dwindle.

Arable Land

The global land surface (not covered by ice) is just over 32 billion acres. Arable land, which is defined as land with soil that has the potential to produce farmed crops, is 10% of that total. Some 40% of arable lands are not used for reasons such as the lack of sufficient water, the difficulty of clearing or disease control. The remaining approximately 2 billion acres is the source for almost all global edible biomass and more than 90% of the protein consumption. See Figure 5 (at the end of this paper).

Studies have indicated that each acre of useable arable land will support 2 1/4 persons (0.45 acre/person) with an "average" nutrient energy basket.19 The current U.S. reality, with a diet that includes a variety of fruits and vegetables, a large supply of animal protein, and in general a diversity of other foods, uses about 1.24 acres/person of the current domestically available 1.83 acres/person.20 At a 1 1/2% population rate of growth (and no loss of topsoil), the reserve of arable land available will disappear in under 30 years. The world in total is dangerously close to the 0.45- acre/person floor, with significantly large population increases unavoidable. The United Nations has predicted that, under current agricultural practice, significant portions of forests and woodlands will, ill advisedly, be turned into crop production early in the twenty-first century.21 Forest and woodlands, critical for CO2 uptake (considered by some as the key to controlling global average temperature) are shown in Figure 5 (at the end of this paper).

Water Resources

The Earth contains 326 million cubic miles of water: 97% is sea water, 2% is locked in ice caps, and a little under 1% is underground -- too deep to pump. Figure 6 (at the end of this paper) shows the amount of global water resources available for beneficial agricultural use. The hydrologic cycle circulates an amount for beneficial use, of which globally 65% is used in agriculture, 25% in industry and 10% for other uses.22 The continued heavy use of water with Green Revolution crops is straining not only surface waters, but also underlying aquifers. The annual overdraft of the Ogallala aquifer was discussed earlier. Large dam construction to obtain additional irrigation water is disrupting ecosystem activity in South America, China and India.


Debates about the future of world agriculture usually end up with technological optimists arrayed against the neo-Malthusian pessimists. The debate could be better framed when all recognize the turning point between the "empty" and the "full" world that emerged in the last half of the twentieth century. We are now pressing strongly against the ecological limits of the biomass creation system, using tools (non-renewables) that do not have staying power and whose side effects reduce the long-term health of the systems that we depend upon for survival. This is not tomorrow's problem; it is today's problem! Solutions will have to be deliberate and considered, and approaches taken will need to simplify the complex by identifying and characterizing the basic objectives of, and the constraints to, implementing sustainable development.


1Dr. Tencer is a consultant to Mr. Roy F. Weston; adjunct professor in the School of Engineering and Applied Science, University of Pennsylvania; and a member of the Board of Directors and the Executive Committee of the Ben Franklin Technology Center of Southeastern Pennsylvania.

2The management of aquatic systems is not treated in this paper. They produce only 1% of the caloric intake for humans; however, they are a significant protein source for many peoples in poorer nations and are renewable systems being pushed to the edge of unrenewibility by overexploitation. As such, they will be examined in other forthcoming WESTON publications.

3Daly, H.E. 1992. "From Empty-World Economics to Full-World Economics: Recognizing an Historical Turning Point in Economic Development." In: R. Goodland, H.E. Daly and S. El Serafy (Eds.). Population, Technology, and Lifestyle. Island Press, Washington, DC, pp. 23-27.

4Weston, Roy F., "The Weston Way," April-May 1995 "Sustainable Development: To Better Understand the Concept," "Sustainable Development: Integration of the Free Market Economic System into the Natural Economics System." pp. 12 and 13.

5Waggoner, P.E. 1994. How Much Land Can Ten Billion People Spare for Nature? Council for Agricultural Science and Technology, February 1994, Figure 7.2.1.

6In the United States between 1910 and 1960, 90 million acres devoted to fueling horses and other draft animals were converted to crops for direct human consumption and livestock feed.

7The Green Revolution involves the planting of a monoculture of scientifically bred plant varieties and then applying large amounts of inorganic fertilizers, pesticides and irrigation water. The concepts in the Green Revolution ultimately were taken up by most of the nations of the globe. The increase in farm energy yield has fed the greatly increasing population.

8(Figure 1) U.S. Agricultural Productivity Sources

(1)Agricultural Statistics. 1993. U.S. Department of Agriculture, National Agricultural Statistics Service, GPO, Washington, DC 1993. Wheat: Figure 1, page 5 converted from bushels/acre to kcal at 60 lb/bushel and 4,010 kcal/kg - or 109,000 kcal/bushel. Corn: Figure 2, page 32, converted from bushels/acre to kcal at 56 lb/bushel and 3,910 kcal/kg - or 100,000 kcal/bushel. Soybeans: Figure 5, page 116, converted from bushels/acre to kcal at 60 lb/bushel and 4,030 kcal/kg - or 110,000 kcal/bushel.

(2)Additional data points from Waggoner, 1994, Figure 7.2.1.

9Brown, L. et al. 1994: Vital Signs. Worldwatch Institute, W.W. Norton & Company, NY, pp. 43 and 93.

10(Figure 2) Energy Subsidy Sources:

(1)Steinhart, S., and C. Steinhart. 1974. "Energy in the U.S. Food System." Science, Vol. 184, 19 April 1974, pp. 307-315. For 1910- 1930, Figure 4, page 311.

(2)For 1940-1990, see sources for Figure 3, listed in footnote 12.

11Putnam, J.J. 1993. "American Eating Habits Changing: Part 1 Meat, Dairy, Fats and Oils". Food Review, September-December 1993, page 4.

12(Figure 3) Energy Flows -

For Food Consumed:

(1)Gerrior, S., and C. Zizza. 1994. Nutrient Content of the U.S. Food Supply 1909-1990. U.S. Department of Agriculture, Home Economics Research Report No. 52, pp. 51-53 for kcal/ person/day.

(2)U.S. Bureau of Census, Statistical Abstract of the United States: 1992. 112th Edition. Washington, DC, GPO, page 6 for population.

For Input to the Food System:

(1)Steinhart. 1974. Table 1, for 1940-1970.

(2)World Almanac and Book of Facts. 1994. Funk & Wagnalls, St. Martin's Press. For 1980-1990 national energy consumption, page 150.

13See Footnote 12 (2): Statistical Abstract, 1992. Table 681.

14Elitzak, H. 1992. "Marketing Bill Is the Largest Chunk of Food Expenditures." Food Review, July-September 1992, page 13.

15Agricultural Statistics. 1993. Tables 438 and 441.

16Brown, L. et al. 1994, page 30.

17Pimentel, D., and M. Giampietro. 1994. "Food, Land, Population and the U.S. Economy." Carrying Capacity Network, Washington DC, Released 21 November 1994, page III-11.

18Food and Agricultural Organization of the United Nations. FAO Yearbook - 1992. Rome, pp. 237, 239.

19Bryson, R. 1986. "Environmental Opportunities and Limits of Development." Leopold Centennial Lecture, June 1986, Madison Center for Climate Research, University of Wisconsin, Madison.

20Lal, R. 1989. "Land Degradation and Its Impact on Food and Other Resources." In: Pimentel, D. (Ed.), Food and Natural Resources. Academic Press, San Diego, pp. 85-140.

21The World Environment 1972-1992 - Two Decades of Challenge. 1992. Tolba and El-Kholy (Eds), Published by Chapman & Hall, London, on behalf of the United Nations Environmental Programme.

22Postal, S. 1992. The Last Oasis - Facing Water Scarcity. Worldwatch Environmental Alert Series, W.W. Norton & Company, NY.

(Reprinted from "The Weston Way," April/May 1995, Roy F. Weston, Inc., 1 Weston Way, West Chester, PA 19380 USA, Roy F. Weston, Phone 610-701-3511, Internet Address:

About Roy F. Weston, Inc.

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"Sustainable Development" WESTON WAY April/May 1995
Part 4 of 8


Integration of the Free Market Economic System into the Natural Economics System


Roy F. Weston, P.E., DEE,
Chairman Emeritus,
Roy F. Weston, Inc.


All the things that surround us, everything that happens, and everything that we must adapt to or otherwise do to live and make a living are part of a natural economics system. Nature has provided the resources and the "rules of the game" that govern all past, present and future outcomes. The natural economics system has sustained life on Earth for billions of years. To maximize our well- being, we must maximize the effectiveness of accessible resources and the efficiency with which we use them in accordance with the natural economics "rules of the game." Our free market economic system is the best of human design. Nevertheless, our unsustainable circumstances provide ample evidence that the system does not maximize natural economics' effectiveness and efficiency and does permit unsustainable development. Therefore, any endeavor that can integrate the self-organizing and self-regulating features of the two systems (the natural economics system and our free market system) will increase the possibility of attaining sustainable development and will be worth the bother. To achieve integration, it is necessary to understand the attributes of each system and to identify those attributes of the free market system that contribute to ineffectiveness and inefficiency. The purpose of this paper is to summarize pertinent attributes of each system and to discuss means for integrating them to ultimately achieve sustainable development.


The natural economics system "rules of the game" govern everything that happens on planet Earth. That means they govern every transaction involving the exchange of any of the basic economic resources -- energy, matter, space, life and time. Thus, the natural economics system is complete and is integrating and cross-cutting. It deals only with reality. Transactions include those associated with geological aging, geophysical situations, climate, the hydrologic cycle and the life system's self-organization and self-regulation attributes. Humans must adapt to these circumstances. The "rules of the game" include Mother Nature's physical system self-enforcing laws, her life system self-organizing and self-regulating laws, the Earth system "realities" and human-enforced laws. Also, there is self-enforced "full-cost" accounting.

The life system, of which humans are a part, has an organizational structure and "rules of the game" that conform to the physical system's "rules of the game." The life system is a hierarchy of species made up of individual stakeholders with different, specific attributes. Those attributes determine the resource needs of the individual to survive and the price, in terms of energy, time and bother that the individual must expend to meet survival needs. The life system organization establishes the interrelationships and interdependencies among the various species to effectively use energy, matter, space and time to sustain the system, and includes species with appropriate technological attributes to conserve and keep essential nonrenewable resources accessible to the system's economy. The system has the capacity to meet all human specific survival needs. The system is actuated by the individual. The individual has a desire to live, a capacity to be an opportunist to adapt to or alter its situation or condition, and the propensity to reproduce (i.e., reproductive propensity), to consume needed resources by maximizing gain from expenditures (i.e., priority propensity), and to continue to reproduce and to consume resources until the resources are exhausted (i.e., completive propensity). While all individuals have a prudence propensity, a few are more strongly endowed with that propensity than the others. These are the few most likely to survive.

The "rules of the game" for individual behavior, the impact of time, and the variation in environmental situations and conditions provide a dynamic diversity in species population that varies around a carrying capacity mean. The attributes of the system's members permit selective and massive extinction strategies for self- regulating the quality and quantity of the members of the system. In human parlance, we would call this "pruning" and "downsizing." In fact, the propensities of the system's members drive the system towards imbalance and massive extinction. Thus, massive extinction of one or more species occurs locally, frequently, and, in some cases, globally. Balanced systems (i.e., those with diverse species) provide a dynamic balance among species that maximizes the system's biomass productivity (i.e., carrying capacity) from accessible resources and environmental situations and conditions.


Organization and Policy

The organization and policies of the free market economic system reflect the values (e.g., freedom, fairness, and justice) of the people who designed it. Organization and policy are clearly the most significant instruments for maximizing economic effectiveness and efficiency; organization provides the means and policy provides the "rules of the game" for achieving the desired objective. Government reflects the will of the people in providing "rules of the game" for establishing and operating economic system organizations. Generally speaking, economic organizations can beclassified as "for profit," "not for profit" (e.g., non-government organizations) and "government." These classifications establish the taxpaying status and other "rules of the game."

The freedom of the free market economic system provides considerable flexibility in establishing organization (e.g., kind and purpose) and policy within the formal constraints provided by governmental law. This freedom has provided the opportunity for citizen, special and vested-interest groups to organize voluntarily funded, "not for profit" organizations. Historically, such organizations have been adversarial toward "for profit" organizations. Recently, however, they have been moving toward a problem-solving relationship. If such organizations can move from a "where we don't agree" to a "where we do agree" mindset, they can provide a valuable and efficient educational service to the general public, "for profit" organizations and government. They are a viable part of the private sector. They can be the community's conscience and the community's watch person. They can make a positive contribution toward maximizing community economic efficiency.

Nevertheless, it is the "for profit" private sector segment of our free market economic system that has the greatest impact on the quality of our lives and therefore should be of greatest concern to us. A preliminary assessment of the free market economic system reveals that its organization and policies are based on:

* Concepts (theories) of freedom of choice for consumers in meeting their needs and wants.

* Free markets in which to make choices.

* Freedom for entrepreneurs to form the enterprises that supply the markets.

* Free competition among the enterprises.

* Freedom to manage private enterprises within the constraint of the necessity to make a profit.

* Governmental "rules of the game" designed to protect the interests of consumers, employees and shareholders by establishing limits on the degree of freedom of enterprises.

Within the free markets, goods (i.e., the basic resources or products and services derived from those resources) are offered by enterprises to satisfy consumer needs and wants. Consumers purchase goods on the basis of satisfaction for the price paid. Enterprises compete to sell their goods at a profit. A system of accounts and accounting procedures tracks economic transactions, accountability and ownership to determine profit and to establish financial status.

The system is driven by consumer demand and the rewards (i.e., profits) to entrepreneurs for providing goods efficiently and satisfactorily. The prime players are consumers, entrepreneurs and the people's representatives in government. All of these players are faced with dilemmas because all players are also consumers. All players must make or derive a living through an enterprise or government. All have a direct (if they are voters) or indirect accountability for good government. The interrelationships and interdependencies of the players influence individual attitudes and behavior and government organization and policy outcomes. Members of the system strive to postpone selective extinction and are outraged with massive extinction; nevertheless, the system's rules permit enterprises to fail. Governmental "rules of the game," however, are protective of the consumers, the employees and the general public shareholders of enterprises.

The "rules of the game" have produced a system that is highly self- organizing and self-regulating, much like Earth's life system, and that governs community and individual outcomes by strict enforcement of the rules. The system's rules have made it possible for individuals to want and to use resources at a rate that is orders of magnitude greater than required to meet the individual's survival needs. The system has not always provided the organization or "rules of the game" necessary to counterbalance such a high rate of use. For instance, the system has only limited capacity to keep nonrenewable resources accessible to its economy. The system's rules permit the wastage of resources sufficient to permanently decrease the accessibility of resources to its economy, and to create environmental hazards and pollution. Government has set no clear objectives for the system except the creation of jobs and continual growth. The system, however, is highly democratic and, in fact, is more democratic than our system of governance. We all vote with our pocketbooks daily. Community dynamics responding to the "rules of the game" counterbalance the lack of clear objectives.

System Inefficiencies

Further assessment reveals what economic theorists have recognized for some time -- that the free market economic system has inherent inefficiencies. They explain that there are inefficiencies in the way free markets handle accounts and accounting and pricing systems. The prime reasons1 for these inefficiencies are:

* Theory and practice exclude some of the elements that influence outcome.

* Theory presumes the coverage of some factors that in practice must be treated as externalities.

* Theory is based on hypotheses that are inconsistent with the real world.

* Real world practices are inconsistent with achieving pricing objectives.

The free market pricing system excludes many of the products and all of the services provided by the non-human part of the life system. For example, the recycling of carbon dioxide to provide life- essential oxygen is excluded. "Free goods" are excluded. When "free goods" transactions become economic, they are considered to be externalities. Unfortunately, more and more, goods that were at one time "free" (e.g., clean air and clean water) are now scarce goods of economic significance. The free market pricing system has no inherent means for handling public property and the global commons. The system has no means for allocating the costs associated with atmospheric disturbance disasters caused by anthropogenic activities. The system presumes that the producer is well-informed about costs and the consumer is well-informed about what the requirements should be to assure satisfaction. These are false presumptions because today neither the producer nor the consumer has the knowledge required to make prudent micro-decisions that can have global impact. Real world practices, particularly those involving government policies on taxation and subsidy programs, significantly influence economic effectiveness and efficiency. Because such programs are generally politically rather than economically motivated, they tend to lower economic effectiveness and efficiency. More detailed discussions about system inefficiencies are presented under the sections "Accounts and Accounting" and "Pricing System."

Targets for Alteration

Because of their impact, accounts and accounting and pricing are the primary instruments influencing economic outcomes.

Accounts and Accounting

The basic purpose of accounts and accounting is to provide information for decisionmaking, evaluating performance and establishing financial status. Accounts and accounting record transactions, allocate revenues and costs, establish the financial status of economic entities and determine the profitability of private enterprises. Free market economic system accounts consist of economic resources such as monetary and tangible assets and rights. They need to be identifiable, quantifiable in terms of money, and ownable or allocatable.

Accounts and accounting are used to establish the financial status of nations as well as all other economic entities, including individual persons. Decisions are made at all levels based on accounts and accounting information. If this information does not reflect reality, wrong decisions will be made, wrong actions will be taken, and wrong outcomes will result. For instance, if natural capital is not included in national accounts, the exploitation of natural resources may increase national Gross Domestic Product, temporarily giving the impression of increased well-being when, in fact, the exploitation is consuming capital that has continual value in meeting well-being needs. Thus, inadequate accounts, lack of full-cost accounting and the human priority propensity all lead to poor long- term decisions. In the case of a renewable natural resource, such as fisheries in the global commons, natural economics can determine the means for maximizing sustainable return on the natural resources investment. If nonrenewable resources are exhausted, those resources may be permanently lost to the human economy. For instance, if those nonrenewable resources have been wasted to the environment, they may be accessible to the life system on the basis of its long-term natural economics timeframe, but not be accessible to humans within their economic timeframe; therefore, there is lost opportunity for both present and future generations. In addition, the resource losses will likely impose costs on others because of pollution and reduction in life system productive capacity.

Industrial experience has clearly demonstrated that appropriate accounts and full-cost accounting that ensure the correct allocation of costs to accountable parties will change behavior and reduce costs. There are many examples of wrong decisionmaking because of unrealistic accounting information. Some enterprises have profited at community expense because full-cost accounting was not used in allocating costs. In this country an entire segment of the economy, food production, is based on unrealistic costs and prices because of government subsidies. A global economy, which includes hundreds of millions of individual decisions that impact that economy, is driven by self-deceiving decisions because of unreal cost information, for example, the unreal price of fossil fuels.

Present accounts and accounting rules constrain integration because natural economics includes all of the Earth's resources as economic resources. All natural economics transactions are made in terms of the actual resource, not in terms of money. Also, many resources significant to the human economy are not owned by or allocatable to a specific individual (i.e., entity). These constraints can be overcome with change over time toward full-cost accounting.

I believe that natural economics' accounts and accounting procedures will be used initially in an assessment process as an instrument for identifying, avoiding or solving sustainability problems. In time, appropriate accounts and accounting procedures will become a routine management tool. Eventually, there will be standardization for their use in compliance with legal requirements relative to advertising, performance compliance and taxation.

In the assessment process, effectiveness and efficiency relationships will be determined on the basis of an accounting of the relevant resource. Resource relationships will be converted into monetary relationships as necessary.

Pricing System

The free market pricing system has provided the following goals for efficiently establishing prices:

* Voluntary exchanges in a competitive market must establish a price such that all participants consider it to their advantage to engage in transactions.

* Producer participants maximize their profit and the consumer participants maximize their satisfaction.

* Nonparticipants in the transactions neither gain nor lose as a result of the transactions.

If the price is correct, price and value will be essentially equal. Price generally assesses the short-term benefits and value generally assesses the long-term benefits. Price should always reflect value. One does not have to be an economist to understand the logic and the soundness of these and the pricing system goals. These are human goals to enhance the system's efficiency and fairness.

The "no gain, no loss" pricing system goal establishes a high moral plane for performance. It establishes a virtue-based goal. The fact that the efficiency of the free market economic system is highly dependent on moral performance is probably one of the most carefully guarded secrets of the free market economic system. It means that a goal essential to the efficiency of the system has been systematically and consistently ignored. The "no gain, no loss" goal is the rug under which economists sweep their difficult-to-solve externality problems. It is, therefore, a powerful driver for change. For instance, a producer who wastes resources to the environment increases costs to nonparticipants by creating environmental pollution. Free market pricing system goals would allocate such an increase in costs to the consumer participants. Accountability for ensuring that nonparticipants are not allocated costs belongs to the producer. In other words, the system pricing goals allocate the burden of proof and associated costs to the producer; otherwise, producers would have unduly lower costs and thereby undue profits and the consumers of their products would gain at the expense of the nonparticipants. In practice, many individuals consider costs incurred to avoid the unfair allocation of costs to nonparticipants as unnecessary costs to the system. Command/control regulation of pollution provides relief from the system's inefficiencies and inequities, but there is ample room for improvement.

The lack of an effective self-regulating means for enforcing the "no gain, no loss" goal has created the biggest con game in town. It has created the need for advocate and self-interest groups and lobbyists to strive to influence the governmental "rules of the game" to their advantage. They use the art of politics to gain undue advantage. The free market pricing system goals are sound. The challenge is to attain those goals through self-regulation. The requirement of full- cost accounting is a large step in that direction.

As indicated, price is established by free markets in most cases. There are some cases, however, in which the conventional pricing process is neither effective nor efficient. I have arbitrarily classified the different instruments that have been, or should be, used as surrogates for the pricing system as follows:

* Full-cost accounting.

* Case-specific means.

* Price management (strategic nonrenewable resources/special circumstances).

* Prudent Practices Guidelines (technology/ethics basis).

The free market pricing system and each of the surrogate instruments are discussed below.

Free Markets

Free markets rely on the priority propensity of the individual to actuate the system and on the legal system to achieve justice. In both theory and practice, the free market pricing system relies on the same human propensity to actuate its system that Mother Nature uses to cull her species. Today, in many parts of the world, local massive extinction is occurring because of human reproductive, priority and completive propensities. The sequence in outcomes is an increase in the need for survival to a level approaching the local resource carrying capacity, followed by mismanagement of resources, warfare or violence, famine, disease and massive extinction. Such real world outcomes motivated the call for sustainable development. Such outcomes can be anticipated and avoided.

Advances in technology have made it possible to lower costs and to increase return on investment and thereby lower prices in the face of impending scarcity. Although cost trends have reversed, past and present inefficiencies in the pricing system have permitted a gross wastage of a limited and finite resource -- petroleum and associated natural gas. Members of the Earth's economic system have built a massive world economy that is highly dependent on that resource. I believe that such dependency will not pass a "Prudent Person" test relative to decisions about uncertainty and risk. There is no scientific evidence to assure us that petroleum or other fossil fuels can satisfy the energy wants of present populations or meet the energy needs of future populations. There is no scientific evidence to assure us that proven renewable energy conversion technologies can meet energy needs at the time of fossil fuel exhaustion. At the present rate of use, fossil fuel exhaustion is certain. With that certainty, the risks to human health and safety for present populations and massive extinction for segments of future populations loom catastrophic.

The pricing system assumes that decisions will be rational and prudent. This may have been a logical assumption in an era of a limited universe about which the decisionmaker had an acceptable level of knowledge, or in an era of a large resource base in which scarcity was relative and marginal propensities could be applied prudently. This is no longer the case. Today, local decisions have global significance. Micro-decisionmakers do not have adequate information to ensure prudent decisions. To add to the seriousness of the situation, there is clear evidence that reproductive, priority and completive propensities will override the prudence propensity. In addition, there is evidence that tech- nological development can reduce price in the face of increasing scarcity. Thus, there is a need for organizational and policy change to protect ourselves from our propensities. A proposed approach will be discussed under "Price Management."

Most people believe that general business practices leave much to be desired. Unfortunately, some business people strive to "beat the game." Others fall back on the cliche "business is business." Both approaches mean that business practices can be within the law although "not exactly" moral. If the economic system is to be effective, efficient and fair to maximize effectiveness and efficiency, personal accountability for moral (or right) behavior is necessary. Legal justice is after the fact; morality is before the fact. Morality can be considered prevention, while justice may be considered the cure. Our adages tell us that "a stitch in time saves nine"; "an ounce of prevention is worth a pound of cure." I believe that personal accountability for moral behavior must become a recognized instrument of efficient free market economics. Moral behavior must become our culture. Rules of ethics, or right practices, should be a part of Prudent Practices Guidelines, which are discussed later.

Full-Cost Accounting

Full-cost accounting can change cost by changing cost allocation. A change in cost allocation can change the basis for establishing price. In addition, full-cost accounting provides needed information about the source and magnitude of costs. Much progress is being made in the acceptance of the full-cost accounting concept at the international, national and local industrial plant levels. The concept is now being made available for monetizing natural capital by the United Nations, the U.S. Department of Commerce, industry and several foreign nations. Full implementation of this concept is essential to maximizing the effectiveness and efficiency of the free market system.

Unfortunately, although full-cost accounting may be possible, proper allocation of costs may not be feasible in all cases. For instance, encroachment on nature's space needs for geologic aging and atmospheric disturbances and floods entails uncertainties and risks. These uncertainties and risks can be estimated. On the basis of knowledge, humans can adapt to that which they cannot control. They can provide insurance programs and other free market means to adapt to their circumstances. However, in the case of atmospheric disturbances, including rainfall resulting from anthropogenic activities, the fair allocation of costs may be daunting. For example, micro-actions by individuals and communities create situations in which self-enforcing law converts solar light energy into heat. This occurs in the atmosphere because of gaseous emissions and at the Earth's surface because of changes in the conversion and reflection of light energy. Climate change will first become evident by an increase in the variability and violence of, and precipitation from, atmospheric disturbances. I believe such trends are now occurring. If they are, the insurance industry will have difficulty in accommodating the rate of change. The economically efficient answer will be found in prudent and moral practices for prevention rather than cure. Proof of no harm should be an accountability of the producer. Obviously, full-cost accounting is of inestimable value in attaining the pricing system goal of "no gain, no loss" for nonparticipants in economic transactions.

In endeavoring to maximize economic effectiveness and efficiency, the taxes required to cover the costs of governance and government services have become a significant item. Taxes are a financial concern to private enterprise because they impact international competitiveness and are a concern to individuals because they impact job opportunities and their standard of living. I believe that to maximize efficiency, the cost of governance should be separated from the cost of services. The costs of governance should be minimized and provided within a fixed budget. Costs can be minimized by eliminating counterproductive micro-management. The costs of services should be accounted for as operations and capital investments. The budget of each category should be justified and adhered to in accordance with the same sound economic rules that government applies to "for profit" private enterprises. Government must be held accountable to the same standards of performance required of the private sector. It is the only sound way to minimize the costs of government to ensure international competitiveness.

Any government taxation program should address the issues of income, capital gains and estate taxes. All reflect regressive natural economics. Natural Economics Impact Assessments can provide the information necessary to maximize economic effectiveness and efficiency to meet human needs. I am sure that Natural Economics Impact Assessments will reveal that there are relatively few individuals with the entrepreneurial capacity to create jobs and wealth. This scarce resource should be leveraged, not stymied. Income and estate taxes reduce the capacity of such individuals or organizations to contribute to the common good. Income taxes should be eliminated. In their place, there should be consumption taxes supplemented by surtaxes on luxury consumption and wastage. I believe that as a general policy, taxation "rules of the game" should incentivize good behavior and disincentivize bad behavior. Welfare, health care and crime should be addressed as economic, rather than political, issues.

Accounting standards require that all transactions of the free market economic system be based on the exchange of currency, i.e., money. The exchange of money for value, however, may give the unrealistic impression of infinite substitutability. It disconnects the real, tangible resource from the value that money is supposed to represent. It creates the perception that money is "just money." Actually, in our free market economic system, money is an inadequate surrogate for wealth. It is inadequate because wealth is an imperfect measure of the value of human time. Generally, wealth is the result of creative, prudent, economical, thrifty and persistent effort over time by individuals. Thus, money is not "just money," it is a surrogate for valuable human time and bother. Natural Economics Impact Assessments and evaluations demonstrate this fact.

Consideration of money and value raises an interesting question: Will consumers spend their money differently if they know more about the industrial metabolism of the products they are purchasing? Some producers think so. They advertise the "greenness" of their products and endeavor to use the "greenness" of their products as a competitive advantage. This is movement in the right direction; however, this movement requires the means for ensuring truth in such advertising. Such assurances are being provided through private sector activities as well as through government.

Case-Specific Means

Case-specific means include those cases excluded from the system and those cases violating the pricing system goal that non- participants in transactions shall neither gain nor lose. Case-specific means include treaties, command/control regulation and means for specific situations, such as Global Commons fishing rights, mineral rights, pollution control (e.g., Montreal Protocol on CFCs), new products, major projects, specific taxes and rule-making legislation. Specific cases require cost/benefit analyses and one or more types of impact assessments under current legislation and should require Natural Economics Impact Assessments in all cases. I believe that decisions will be different if these analyses and assessments are made using basic resources and natural economics' criteria as the prime basis for decisionmaking. Conventional monetary-based analyses and assessments can be used as the secondary basis for decisionmaking. A standardized, natural economics approach can be used for all cases.

A change in environmental protection command/control regulatory compliance policy from a means to a voluntary performance objective base will stimulate the implementation of sustainable development. A corporate voluntary commitment to go beyond compliance and to submit to a third-party audit or citizen suit, to permit exposure through the publication of audit results, and to agree to severe penalties for deliberate or inept violations of voluntary commitments would provide the following positive changes:

* Minimize government involvement by reducing monitoring and enforcement costs.

* Stimulate use of sustainable product designs, material substitutions and new sustainable manufacturing, waste minimization and monitoring technologies.

* Maximize industrial economic efficiency and international competitiveness by permitting timely change in accordance with changing circumstances.

* Provide the general public and skeptical advocate groups a guarantee of good faith performance.

* Open the door for broadening the base for a more ethical and thereby more effective and efficient community performance.

Such regulatory changes can make it economically feasible for producers to use sustainable performance as a competitive advantage.

Price Management

Price management is necessary for global, regional and local situations where local owners of tangible assets or rights are willing to sell their resources at a price below current regional, national or global social value and significantly below future social value. A glaring example of this kind of situation is the current price of fossil fuels. These fuels are being used from hundreds of thousands to possibly a million times the rate at which nature formed them. The price is sufficiently low that wastefulness is common (e.g., petroleum well-flaring of gas, ineffective uses for fuel).

Overall, the United States is the most wasteful user of energy in the world. Current per capita energy consumption is 80 times the U.S. average of 3,700 kilocalories per day of food energy we consume individually to sustain our lifestyle. Morever, our current per capita energy consumption is 82 times the world average per capita food consumption of about 2,700 kilocalories per day. The overall energy efficiency, including photosynthetic energy, for our food growing and marketing system is about .03%. The food production efficiency in the use of fossil fuel energy is about 10%. The food growing and marketing system uses about 17% of the energy consumption in this country. With 5% of the world's population, the United States uses 25% of the world's fossil fuel energy. Currently, we import more than 50% of our petroleum usage. About 90% of our energy consumption is provided by fossil fuels.

Fossil fuel availability is limited spatially and finite quantitatively. The resource is exhaustible. Excessive use of fossil fuel resources raises serious international ethical issues about loss of opportunity for current and future generations. Because the resource is limited spatially, international trade is necessary; thus, there is strong evidence of the need for an international governmental organization to act as a Prudent Person Surrogate. The concept of a Prudent Person Surrogate is not new. Our Supreme Court and our Federal Reserve Board act as a Prudent Person Surrogate. The Prudent Person Surrogate should have the civility to wisely regulate fossil fuel price, based on reliable information. The price should be established at the resource well- head or mine mouth and should act as a disincentive to use fossil fuels for fuel. The managed price should consider future scarcity. It should include a "sustainability fee" and provide for the accumulation of funds that can be used to develop energy conversion alternatives, fulfill equity needs and institute revenue-neutral tax reduction programs. Target price change should take place over 10 to 15 years. If enacted, I believe that such a program will have a positive effect on the economy.

International cooperation is highly desirable, but not absolutely necessary. Until international cooperation occurs, individual nations can establish their own programs. Obviously, action is critically needed in the United States. We should act because some nations are managing the price of gasoline at this time to stimulate efficiency in their economies. Their adjustments now can give them a competitive edge in the future.

Other examples of where price management is needed include arable land, which is rapidly becoming a globally scarce resource; coastal lands, which are of significance to global commons fisheries; and interregional wildlife migration pathways. The new science of ecological economics is establishing methodologies for determining realistic natural economics impacts and values. Although price management should be the last resort, I see no way, at this time, to avoid price management of critical resources such as fossil fuels. It is the most effective way to equitably impact all levels of the economy while transitioning to sustainable development and a practical way for incentivizing the development of fossil fuel energy alternatives. To be effective, price management should comply with an economic constitution designed to ensure sustainable development. The constitution should satisfy the need to institutionalize measures for self-regulation of consumption through full-cost accounting and pricing system instruments, such as a Prudent Person Surrogate, to protect ourselves from our priority propensity to consume and our completive propensity to exhaust accessible resources.

Prudent Practices Guidelines

Prudent Practices Guidelines would be virtue-based guidelines to assist in meeting the "no gain, no loss" goal of the pricing system. They would be developed by organizations and individuals to ensure that both macro- and micro-decisions and actions enhance opportunities for maximizing natural economics' effectiveness and efficiency. Prudent Practices should include the following instruments:

* Purpose and philosophy statements from all influenial organizations.

* Codes of ethics from the professions.

* Performance commitments for environmental and resource conservation from industry groups.

* Product quality and truth in advertising certifications.

The practices should be used as an adjunct to command/control regulation. They can be used as a substitute if they are supported by Natural Economics Impact Assessments, commitment on the part of the subject organization to go beyond compliance, and appropriate audit or citizen suits to confirm or to ensure adherence to the performance commitment made by the regulated organization.

It must be remembered that the means for ensuring fairness (i.e., no loss of opportunity) for future generations may be significantly more complex than the means for ensuring fairness to members of the current generation. Decisions must answer the question of moral rightness and timeliness. If the proposed action is morally right and must be done eventually, why not do it now? In some cases, Prudent Practices may be technology-based and may require physical changes to correct micro-level variances from the nonparticipants' "no gain, no loss" goal. In other cases, Prudent Practices may require only simple moral behavioral changes and could be called "Right Practices." Right Practices can fill the void created by the inability to monetize a micro-transaction. Few organizations are so efficient that Prudent or Right Practices Guidelines cannot be creatively introduced into their culture. My experience shows that Prudent and Right Practices engender efficiency and thereby cause unexpected favorable outcomes.

The Prudent Practices Guidelines idea is promising because, in enlightened self-interest, segments of the private sector have in the past and are now establishing and conforming to standards for their own and the public's common good. Voluntary compliance with Total Quality Management concepts, various industry environmental protection standards and ISO 9000 standards are some examples. Willingness to voluntarily comply with the proposed ISO 14000 standards for environmental protection is another example.


The role of the economic system is to provide the organization and "rules of the game" so that participants in the system will contribute toward the effective and efficient allocation of accessible systems resources in the course of satisfying their own needs and wants. From a sustainable development perspective, this role will enable participants in economic transactions to contribute toward maximizing their community's capacity to sustain itself. Sustainable development is a requirement to avoid nature's inhumane process of massive extinction for culling the species. To avoid that process, maximization of local sustainability capacity will require the trade of energy and matter for human energy, time and bother to effectively and efficiently utilize accessible human resources. It may require the enhancement of human capacity to better utilize local energy, material and space resources. In other cases, it may require population control because local population needs exceed the local sustainment capacity. Thus, there are serious issues of resource allocation and personal accountability.

It must be recognized that there is no large city that is sustainable from resources solely from within its geographical limits. It must also be recognized that on that basis there are only a few sustainable countries; thus, there is need for free trade. The rules of free trade, however, must be concerned about the equity of the wasteful use of resources and the impact of such practices on the loss of opportunity for both present and future generations. Free trade rules must also look at the global impact of continued resource wastefulness on the loss of productivity from the Earth's life system and the costs of more variable weather and more violent atmospheric disturbances. The wants of the global community will place significant pressure on resource accessibility and will rightfully challenge wasteful practices that reduce the quantity of resources accessible to the human economy while at the same time creating serious risks to human health and safety. I believe that the world community will challenge the prudence of risking the potential for large present and future generation costs for the sole purpose of permitting current practices to continue that are convenient to present populations but violate the rules of sound economics.

The goals of the "rules of the game" governing the participants in the free market economic system are theoretically and morally sound. The pricing system goals are applicable to sustainable development. In many cases, surrogates have been provided to correct the system's deficiencies, and many things have been done well. The only flaw in the theory that seriously constrains sustainable development implementation is the lack of recognition that the human propensity used to drive the economic system is the same propensity used by Mother Nature to cull her species. Thus, humans will naturally tend to creatively exhaust resources in the short-term unless they are sufficiently wise to counterbalance their priority propensity. Counterbalancing their technological creativity and priority propensity through use of a Prudent Person Surrogate for nonrenewable resources offers a simple and practical means for resolving the most significant issues of the industrialized and industrializing nations and solving the world's problem of attaining a sustainable capacity for meeting its needs and exacting its aspirations.

I feel confident that Natural Economics Impact Assessments will provide the change in perspective necessary to understand the merits of the theory supporting the free market system and to objectively evaluate the means of improving the effectiveness and efficiency of that system. If an honest effort is made to attain the pricing system goals of the free market system, if a national sustainable development objective is adopted, if full-cost accounts and accounting concepts are accepted, and if Natural Economics Impact Assessments are the primary basis for decisionmaking, the United States will be able to become significantly more efficient and will be able to achieve a sustainable capacity.

I believe that no nation can afford to support wasteful resource use practices from either a moral or an international competitiveness perspective. I believe that there is a dire need for the United States to change course and to become a leader in attaining global sustainable development. Therefore, I present a strawman (see Table 1 at the end of this paper) for alteration of the free market economic system that will assist in attaining the nation's sustainable capacity to meet its needs and exact its aspirations.


Integration of the limited scope free market economic system into the complete scope natural economics system will take time and sound planning. Alteration of the free market system to accommodate integration must take place to ensure our well-being. The issue is not whether, the issue is how and how fast.

The highest priority for humankind and for our country is to provide the organization and policy to counterbalance humankind's propensities toward the exhaustion of nonrenewable resources, particularly fossil fuel resources. We should take advantage of the current window of political opportunity. The private sector should accelerate their Prudent Practices programs and continue the voluntary "beyond compliance" performance objective initiative to change the environmental command/control regulatory process. The private sector must be willing to be honest and to expose itself to tests of honesty. Such a willingness could change the "virtue-base" and the economic efficiency of the entire nation. The Republican Congress and Democratic President should continue to reinvent and downsize government. They should establish a national Sustainable Development Objective and provide role model leadership for the development of sound natural economics goals.

The integration of a full-cost accounting and free market pricing system into the natural economics system provides a scientifically and morally sound economic system. It has the potential for changing perspective and incentivizing moral behavior for the benefit of both present and future generations.

Once initiated, I am confident that the concepts of natural economics and sustainable development will create the environment for change needed to maximize our national well-being. I believe that an economy based on the principles of natural economics will attain sustainable development and will be more effective, more efficient, more productive, more stable and more gratifying to all of us. Time is short; procrastination aggravates pernicious problems. Our future is in our hands.

1Economics Principles, Problems, Decisions, 5th Edition, Edwin Mansfield, W.W. Norton and Company, New York, London.

Free Market Economic System Alteration Needs

1.Adopt a National Sustainable Development Policy, such as: The present generation is to attain the capacity required to meet its "needs" and exact its "aspirations," through maximizing natural economics' effectiveness and efficiency in using accessible basic resources, without foreclosing the opportunity for future generations to attain an equivalent capacity to meet their own "needs" and exact their own "aspirations."

2.Leverage the strengths and bolster the deficiencies of the free market system so that efforts, in self-interest, contribute toward implementation of sustainable development through:

* Adopting the United Nations' proposed Natural Capital accounts and accounting standards for determining Gross Domestic Product (GDP) and Sustainable Income (SI, i.e., Sustainable Net Domestic Product), and for using natural economics' criteria and standards (true full-cost accounting) as a supplement to monetary criteria and standards in economic impact assessments.

* Establishing a nonpartisan Sustainable Development Board to set a present price for nonrenewable resources so that future generation nonparticipants in economic transactions shall neither gain nor lose by:

* Acting as a Prudent Person Surrogate with supreme power to develop and enforce an economic constitution and to plan for ensuring a sustainable economy.

* Providing a process for determining present fair market value of nonrenewable resources and for justifying value change.

* Assessing and collecting a "sustainability fee" at the extracted resource's source.

* Managing such funds for research and development and for taxation- neutral and other justified purposes.

* Enforcing the free market pricing system goals that present generation nonparticipants in economic transactions neither gain nor lose by:

* Accelerating the private sector initiative toward the use of morality -- through purpose and philosophy statements, codes of ethics, performance commitments, certifications and Prudent Practices Guidelines -- in the conduct of normal business as a means to assure the public that practices are honest, as a differeniator among competitors, and as a prevention measure to minimize the unethical practices and legal costs associated with doing business.

* Changing environmental protection command/control regulatory policy from an imposed means to a voluntary performance commitment basis.

* Using other established pricing system surrogates, as appropriate.

3.Enhance the government's contribution toward system effectiveness and efficiency through:

* Separating the accounts and accounting for and reporting the costs of governance and government services.

* Downsizing governance by less micro-management by law and more macro-management by policy.

* Requiring government services to abide by the same rules for operations and investments as government applies to the for-profit private sector.

* Treating health care, welfare and crime prevention as economic investments rather than political issues.

* Eliminating regressive income, capital gains and estate taxes and replacing them with progressive consumption taxes and luxury consumption and wastage surtaxes.

* Terminating all existing subsidy programs and reinstating only those programs that can pass new natural economics' criteria and new "sunset provisions."

(Reprinted from "The Weston Way," April/May 1995, Roy F. Weston, Inc., 1 Weston Way, West Chester, PA 19380 USA, Roy F. Weston, Phone 610-701-3511, Internet Address:

About Roy F. Weston, Inc.

Pioneering the industry since 1957, WESTON has become a leading international environmental management, design and consulting firm working in the public and private sectors to preserve, protect and restore vital air, land and water resources. Nearly 2,800 WESTON people specialize in analytical laboratory services, engineering, facility construction and operations, remediation and large-scale turnkey programs. Based in West Chester, Pa., WESTON has 60 offices and laboratories across the U.S. with international operations in Europe and the Asian Pacific.

"Sustainable Development" WESTON WAY April/May 1995
Part 5 of 8



Andrew L. Ullman, Senior Project Leader
James A. Fava, Ph.D., Project Director
Roy F. Weston, Inc.


As an environmental business manager in today's global economy, you face some tough challenges. You must:

* Understand complex regulations and their implications for your enterprise, including the emerging Securities and Exchange Commission environmental liability disclosure requirements and the U.S. Department of Justice prosecution and sentencing guidelines for environmental crimes.

* Protect your business interests from liabilities that could mar your image in the marketplace or your investment value to stakeholders. In fact, some U.S. companies have had to reserve more than $300 million in one year to address environmental liabilities.

* Voluntarily adhere to a variety of established environmental performance standards, for example, Europe's Eco-Management and Audit Scheme, which promotes continuous improvement in industry performance.

These challenges underscore the importance of integrating environmental improvement systems, objectives, targets and practices into your day-to-day operations to help ensure good decisionmaking. The overarching goal is to ensure that your enterprise grows and prospers over the long term and, at the same time, to ensure that your enterprise does not adversely impact natural and human resources. This goal is consistent with the broader concepts associated with sustainable development.

Recently, the International Institute for Sustainable Development developed a definition for sustainable development as it relates to business: "For the business enterprise, sustainable development means adopting business strategies and activities that meet the needs of the enterprise and its stakeholders today, while protecting, sustaining and enhancing the human and natural resources that will be needed in the future."

The fundamental premise is that an enterprise that can successfully accomplish the development of an environmental management system (EMS) that is consistent with the principles of sustainable development will gain a long-term global competitive advantage. This paper describes what an EMS is, how to implement an effective EMS and what benefits can be expected.


An EMS is a group of policies, standards, systems, practices and tools to increase an organization's effectiveness in dealing with environmental matters. An effective EMS is integrated across all relevant functions within a company and ideally is consistent with sustainable development principles. These functions include the following:

* Siting, construction and operation of manufacturing facilities.

* Site remediation management.

* Employee performance evaluation.

* Product, process design and/or modification.

* Procurement of materials and supplies.

* Information management.

* Business management.

* Internal and external communications.

For each of these functions within an enterprise, decisions are made regularly that have some level of impact on minimizing pollution, managing waste, energy efficiency, product safety (from a human and environmental perspective), employee welfare, risk management and community relations. These decisions are made either by a separate unit solely responsible for environmental improvement or by individuals whose jobs involve making environmental improvements, or a combination of these two.

Having an independent unit responsible for environmental management could result in inefficient operations by creating duplicate systems, establishing unclear responsibilities and delaying or protracting decision-making. Effective integration of environmental performance improvement into an enterprise involves including it as an element in the activities or actions of individual in the enterprise, operating within well-defined environmental management policy, management systems, objectives, targets and practices.


The three main phases in the implementation of an effective EMS are Assessment, Improvement and Measurement (the AIM process, Figure 1 at the end of this paper).


In the assessment phase of the process, an enterprise compares its performance against predefined criteria. Areas to be considered during this phase include compliance management, remediation management and product stewardship. These criteria can be based either internally on specific goals or externally on such standards as the sustainable development principles developed by the International Chamber of Commerce. An enterprise may also choose to benchmark its performance against that of other enterprises. When the assessment phase is completed, the organization can determine which areas require improvements and set goals for making these improvements.


Once areas for improvement are identified and prioritized, these improvements can be planned and implemented. Typical areas for improvement include:

* Corporate goals, objectives and performance standards.

* Facility operating manuals.

* Training programs.

* Design for environment programs.

* Project management systems.

* Information systems.

An implementation plan, which includes schedule, resource requirements, expected return and performance measurement criteria, is usually developed for each improvement area. The changes are then executed within the company.


To ensure continuous improvement, an enterprise should implement a performance measurement system along with the identified improvements. The performance measures should be based on clear, quantifiable goals covering both technical performance and business impact improvements (e.g., cost reduction and liability reduction).

Success Factors

The proper development and implementation of an effective EMS can yield significant benefits. Several critical success factors associated with developing these types of management systems are as follows:

Senior Management Commitment

As with any performance improvement/re-engineering process, it is critical that the senior executives within the organization be 100 percent committed to the improvement process from the beginning. If senior executives are involved, they will motivate both the environmental managers, who are making the bulk of the changes, and the other stakeholders (employees, customers, investors), who will be potentially affected by the changes.

Clear Goals and Objectives

To help ensure continuous improvement, all personnel involved must understand what the environmental goals are and how their performance will be measured against those goals.

Resources Commitment

The proper implementation of an effective EMS requires a significant upfront commitment of financial and personnel resources. Enterprises must realize that although the financial benefits of an EMS program may significantly exceed the costs, these benefits may not be realized for 1 or 2 years after the system improvements have been made.

Effective Information Flow

This critical area is often ignored during the improvement process. Many companies have developed elaborate operating procedures/ manuals but do not have the systems to track regulatory changes or update all personnel affected by changes in procedures required in a rapidly evolving regulatory environment.


Of course, compliance is significantly improved by an effective EMS. As a result of improved compliance, an enterprise can realize substantial savings. For example, a U.S. manufacturing company did an internal study on incidents of noncompliance and determined that the actual cost of such incidents was more than 5 times the cost of the fine. This company was averaging more than $1 million in fines per year during the course of the study, so their total cost of noncompliance was significant. In addition to reduced compliance costs, an enterprise can benefit from an improved image, and consequently, improved flexibility in siting facilities.

The benefits of an effective EMS go far beyond regulatory compliance (which seems to be the main focus of many organizations). An enterprise that has an effective EMS can conserve resources (e.g., energy, water, raw materials) and significantly reduce remediation and capital project costs. In addition, some enterprises have used environmental issues to create marketing advantages over their competitors as well as to enhance the confidence of their investors and other stakeholders. See Table 1 (at the end of this paper) for a listing of additional potential benefits of an integrated EMS.

In most cases, the benefits outlined above far outweigh the costs of upgrading a company's EMS. Although many enterprises may initially believe that moving toward sustainable development through the development of an integrated EMS will be just another administrative burden, it is important to analyze all the costs and benefits of such a program before making a decision. An integrated EMS can often increase efficiency and make your enterprise more competitive.

(Reprinted from "The Weston Way," April/May 1995, Roy F. Weston Inc., 1 Weston Way, West Chester, PA 19380 USA, Roy F. Weston, Phone 610- 701-3511, Internet Address:

About Roy F. Weston, Inc.

Pioneering the industry since 1957, WESTON has become a leading international environmental management, design and consulting firm working in the public and private sectors to preserve, protect and restore vital air, land and water resources. Nearly 2,800 people specialize in analytical laboratory services, engineering, facility construction and operations, remediation and large-scale turnkey programs. Based in West Chester, PA., WESTON has 60 offices and laboratories nationwide with international operations in Europe and the Asian Pacific.

"Sustainable Development" WESTON WAY April/May 1995
Part 6 of 8

ISO 14000:

A Building Block for Redefining Environmental Protection and Moving Toward Sustainable Development

Robert B. Biggs, Ph.D., P.G.
Vice President

Glenn K. Nestel, Vice President
Roy F. Weston, Inc.


The momentum toward global markets and international trade agreements has prompted a broad cross-section of companies to adopt international consensus standards, such as ISO 9000 Standards on Quality Management. These same free trade drivers, coupled with the "greening" of global markets and issues like cross-border pollution impacts, have created the impetus for the Switzerland-based International Organization for Standardization (ISO) to formulate environmental management standards. The emerging ISO 14000 environmental standards represent an impending "sea change" that promises to reshape the way both the private and public sectors think about environmental protection.

The ISO 14000 framework represents a move toward integrating sustainable development principles into our free market economic system. It is an important first step toward adopting a system of natural economics as referred to in this issue's accompanying papers. ISO 14000 will incentivize self-organizing and self-regulating approaches to environmental protection that will lay the groundwork for continuous performance improvements.

We expect the strong linkage of ISO 14000 with ISO 9000 to further drive this trend. Benefits derived from the total quality management movement in the 1980s provided strong incentives for businesses to seek ISO 9000 registration. Like quality management, environmental management follows a continuous improvement model. ISO 14000 will stimulate new approaches to materials selection, product and process design, and transportation logistics at each step of the product life cycle. These approaches will lead to overall reductions in environmental burdens, as well as the development of economics-driven reverse distribution systems that reclaim recyclable components at the end of a product's service life. ISO 14000 will encourage significant changes in the way we have traditionally valued both renewable and nonrenewable natural resources. ISO 14000 will also create a market-driven framework for balancing environmental protection with socioeconomic needs and will foster the concepts embodied in sustainable development and natural economics.


ISO 14000 Drivers

Faced with global markets and competition for selling their goods and services, many companies have moved toward new manufacturing and quality control methods. New sourcing models have evolved, and quality management requirements have been extended to suppliers, resulting in significant benefits in productivity and cost competitiveness. The rapid move to adopt ISO 9000 over the past 3 to 4 years has been driven by many factors, a significant one being the benefit of having a single, global set of quality management standards. ISO 9001 or 9002 certification now defines a standard of excellence that replaces periodic customer quality audits of suppliers.

Similarly, in the United States, escalating environmental compliance and remediation costs, coupled with evolving requirements for companies to fully disclose their environmental discharges and environment-related costs, have created a growing awareness of environmental requirements. Sensitivity to environmental requirements has also increased internationally. This increasing environmental awareness culminated at the June 1992 United Nations Conference on Environment and Development (UNCED) in Rio de Janeiro, Brazil, where the concept of sustainable development was rolled out globally and more than 100 countries agreed on the need for further international environmental management standards. This meeting and subsequent UNCED/international focus represent much of the impetus behind the ISO 14000 development process over the last 2 years. There is, in fact, a new group of stakeholders driving enterprises to adopt sustainable business practices. In addition to the traditional stakeholders (shareholders, lenders, regulators and policy makers), the new emerging stakeholders include employees, suppliers, customers, trade associations, professional societies, and community and environmental groups.

ISO 14000 Elements

Figure 1 (as shown at the end of this paper) illustrates the overall ISO 14000 continuous improvement model. It begins with executive management's commitment to corporate governance by a set of overarching principles, including:

* Environmental protection as one of the highest corporate priorities with clear assignment of responsibilities and accountabilities to all employees.

* Compliance with all environmental laws and regulations applicable to the company's activities, products and services.

* Ongoing communications on environmental commitment and performance with all stakeholders.

* Strategic planning that sets forth environmental performance objectives and targets, implemented through a disciplined management process.

* Periodic performance measurement, as well as systems audits and management reviews, to achieve continual improvement wherever possible.

* Full integration with health and safety, quality, finance, business planning and other essential management processes.

ISO 14000 is a series of standards and guidance documents that falls into two broad categories. The first category is Environmental Management Systems (EMS), comprising the following three standards plus an overall guidance document:

* ISO 14000 - Guidance on How To Set Up and Improve EMS

* ISO 14001 - EMS Specification Standard for Registration Purposes

* ISO 14010-12 - Auditing Principles and Procedures for Internal/External Auditors

* ISO 14031 - Guidance on Measuring Environmental Performance

British Standard (BS) 7750 and the evolving European Communities' Eco- Management and Audit Scheme (EMAS) have significantly influenced these ISO 14000 EMS standards. These EMS standards are being developed rapidly, with issuance of the final versions expected later this year or early in 1996.

The second category of standards is more operationally focused in areas of product stewardship. Two standards are under development, one set governing methodology for life-cycle assessment (ISO 14041- 44) and a second governing labeling principles (ISO 14020-24). These standards are not as advanced in the process, with issuance not expected before mid-1997.

Another document, ISO 14012 - Initial Review, is currently being considered. This document would provide guidance for an initial assessment of a company's current situation (baseline determination) in preparing to seek EMS registration under ISO 14001.

Links with Quality Standard ISO 9000

As part of the ongoing EMS development process, Technical Committee (TC) 207 for ISO 14000 is closely coordinating its activities with TC 176, which governs the ISO 9000 quality standards. At a minimum, this coordination will ensure similarity in the ISO 14000 EMS standards structure and format and should result in significantly reduced EMS implementation and registration costs for companies that are already ISO 9000-certified. Figure 2 (at the end of this paper) is a matrix comparing the elements of ISO 9000 with the draft ISO 14000 EMS.

Beyond the formal ISO certification process, the natural linkages between quality and environmental management processes will lead to combined integration into a company's overall business management systems. Practicality will extend this integration to other emerging environmental management codes, such as U.S.

Chemical Industry Responsible Care, BS 7750, International Chamber of Commerce (ICC), Global Environmental Management Institute (GEMI), Coalition for Environmentally Responsible Economies (CERES) and the EMAS regulations, resulting in a single fully integrated Environmental Management System. See Figure 3 (at the end of this paper).


ISO 9000 Momentum/Market Forces

As indicated above, ISO 14000 has been significantly influenced by the ISO 9000, BS 7750 and EMAS regulations. ISO 9000 certification has emerged as the global quality management standard. Thousands of companies have already embarked on ISO 9000; rapid implementation has occurred in sectors like chemicals and electronics. ISO 9000 registration has been strongly leveraged by customer/supplier relationships. ISO 9000 is being market-driven as ISO 9000 companies require their suppliers to become certified. This chain of commerce linkage is a compelling reason for companies to proceed, and we believe there is sufficient ISO 9000 momentum for a natural carry- through into ISO 14000. The timeline and dynamics of the certification process also provide incentives for getting a head start on the ISO EMS process.

Avoidance of Trade Barriers

As previously stated, the official adoption of the ISO 14000 standards is expected to begin by early 1996. The continued rapid growth of ISO 9000 registration and the resulting business successes will provide prima facie evidence driving companies to proceed with ISO 14000 once it becomes ratified. International trade will also play an important role. ISO 14000 is being seriously considered for adoption under NAFTA and various GATT trade agreements to prevent the development of artificial trade barriers from country-specific environmental requirements. Vice President Gore's sustainable technologies task force is, in fact, looking for ways to stimulate the export of U.S. environmental technology to Third World countries. All these developments represent moves toward integrating environmental protection/sustainable development into our free market economics systems, while embracing natural economics principles.

Why Get Started with ISO 14000 Now?

For those companies already involved in ISO 9000, the answer is obvious. Achieving certification is an arduous process requiring numerous internal resources and significant support and assistance from consultants. Experience indicates that ISO 9000 certification takes a minimum of 18 to 24 months, even in companies with well- established quality programs. Many companies who started ISO 9000 early have achieved preferred supplier status and gained a significant competitive advantage. For those who delay, ISO certification has often become a reactive exercise requiring inordinate amounts of resources to catch up with competitors who are already registered.

More importantly, significant performance improvement benefits can be gained by having an effective environmental management system in place. ISO 14000 is one such tool for companies to:

* Better address growing environmental protection pressures.

* Help minimize legal/financial liabilities.

* Reduce compliance costs.

* Enhance stakeholder image.

* Gain competitive advantage.

ISO 14000 also provides the framework for designing more environmentally benign processes and products.

Numerous proactive companies have realized the competitive benefits of superior environmental performance. In the waste minimization/pollution prevention arena, reduced operating costs and cost avoidance opportunities have resulted in lower cost structures relative to competitors and corresponding market share gains and bottom line improvement. Design-for-environment strategies applying life-cycle concepts are emerging, and new products are selectively achieving market successes so long as the market pricing structure is carefully considered. Overall, ISO 14000 implementation will provide a framework for improving regulatory compliance and for supporting environmental protection decisions in balance with other socioeconomic needs. ISO 14000 will provide the building blocks for improving the environmental performance of an enterprise's activities and products consistent with sustainable development and natural economics principles.

(Reprinted from "The Weston Way," April/May 1995, Roy F. Weston, Inc., 1 Weston Way, West Chester, PA 19380 USA, Roy F. Weston, Phone 610-701-3511, Internet Address:

About Roy F. Weston, Inc.

Pioneering the industry since 1957, WESTON has become a leading international environmental management, design and consulting firm working in the public and private sectors to preserve, protect and restore vital air, land and water resources. Nearly 2,800 WESTON people specialize in analytical laboratory services, engineering, facility construction and operations, remediation and large-scale turnkey programs. Based in West Chester, Pa., WESTON has 60 offices and laboratories across the U.S. with international operations in Europe and the Asian Pacific.

"Sustainable Development" WESTON WAY April/May 1995
Part 7 of 8

The Economic Model of the Future

Roy F. Weston, P.E., D.E.E., Chairman Emeritus
Revised September 1993


Sustainable development(1) is a concept for a process of change in which human attitudes and behaviors are modified so that, in endeavors to meet needs, achieve aspirations and preserve options for future generations, individuals and communities(2) will enhance and maintain their well-being by:

* Maximizing natural economics'(3) effectiveness and efficiency through:

* Conceiving development as an integral and compatible part of the Earth's systems.

* Emulating the economics of nature in the production and use of resources.

* Removing barriers to human goodwill, cooperation and capacity enhancement.

* Attaining necessary balance among:

*Resources(4) accessibility.
*Requirements of communities.
*Capacity of communities to meet their requirements.

* Implementing Guidance Principles in establishing goals, strategies, tactics, and the plans needed to meet the effectiveness, efficiency and balance requirements of subject communities.


* Be accountable, personally; practice enlightened self-interest; and acknowledge that every individual's decisions and actions make a difference. Contribute toward the sound governance and maximization of the common good(5) of relevant communities. Be circumspective and caring. Behave ethically and prudently. Anticipate, set goals, strategize, plan, implement, monitor, reassess and react.

* Accept custodianship of the Earth's life system and the systems on which it depends.

* Acquire and diffuse the knowledge needed to understand fundamentals, to achieve goals and to ensure informed risk taking.

* Emulate the economics of nature:

* Maximize system productivity and efficiency in the conversion and use of energy.

* Minimize losses and wastage(6) in the use of essential nonrenewable resources.

* Optimize overall effectiveness and efficiency in the production and use of renewable resources.

* Alter humankind's cultural and institutional "rules of the game" to ensure attainment of the above.

(1)Development: Any change in conditions, materials, products, uses, services, structures, facilities, systems or activities associated with human endeavors.

(2)Community: A group of people with common interests living under the same laws [e.g., Earth, nation(s), municipality(ies), business(es), vocation(s), society(ies) and neighborhood(s)] or a group of animals and/or plants living together in the same environment.

(3)Natural economics: Involves the total system, including both natural and human subsystems. The concept uses all Laws of Mother Nature to provide the most effective and efficient way to achieve a desired outcome. It assesses full costs and benefits including factors excluded from or considered as externalities to the conventual financial-incentive free market economic system. Theory recognizes the impact of factors such as the limits and finiteness of natural resources, natural limits and balances, micro-decisions and actions, interrelationships, interdependencies, self-regulation, human factors, instincts, heredity, variability, foreign to nature, resource irreplaceability, rate of change, prevention vs. cure, risk and the need for multigenerational planning horizon, a community-unit approach, the concept of "common good" and integration with religious, cultural, governance and human economic systems. It is based on reserves, input, output and losses/wastage. It requires that proposed goals be performance-based and permit options for implementation and that accounting principles and standards provide consistency between the public and private sectors. It measures performance by using parameters such as: achieved standard of living and/or quality of life, human capacity to produce and trade, accessibility of resources for future use, non-human life system well- being and productivity, maximum sustainable yield, natural and made wealth, and "net" domestic income. Also, natural economics is based on the use of natural units of measurement for the quantification of energy, materials, space, life and time.

(4)Resources: The Earth's resources are limited spatially and are finite quantitatively. They include energy, materials, space, life and time.

(5)Common good: Minimal disparity in well-being between individual members of the community consistent with maximization of the media of the well-being of all members.

(6)Wastage: The controllable loss or transfer of energy and/or matter to the environment, such that natural or human economic constraints make such resources inaccessible to the community's economy for future use.

(Reprinted from "The Weston Way," April/May 1995, Roy F. Weston, Inc., 1 Weston Way, West Chester, PA 19380 USA, Roy F. Weston, Phone 610-701-3511, Internet Address:

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