Radical Transparency

I've been reading a recent book called Ecological Intelligence, by Daniel Goleman, that discusses something he calls 'radical transparency,' which I summarize as: businesses audit and publish accurate accounts of the environmental, social and other costs of what they make. The theory is that access to this information will induce customers and consumers to make smarter choices based on what they value most (i.e., green vs. cost).

Is this realistic? Doesn't basic economic theory prove this will never work -- that the majority of people will make only the simplest kind of cost-benefit analysis?

As long as they make it compulsory, why shouldn't it work?

Availability of ingredients/additives information, calories per serving, serving size and similar information on packaged foods hasn't by any means solved the problem with American diets. But it's enabled a growing 'conscious shopper' fraction of the population to begin doing so. You have to start somewhere.

If we don't do something like this, we keep subsidizing evil. And basic rules of thumb don't help. I think it was MIT who recently did the math and proved that -- in the case of French mineral water -- the 'buy local' rule was wrong because French environmental standards are so strict that the total environmental impact of buying Evian is less than that of buying water bottled in your home state, even given (dirty) transatlantic container shipping.

I think is an interesting idea but it would probably only work if there was a standard way to measure such a thing. Once established and codified it would have to be prominently displayed on product to have any impact. For example you have two boxes of pasta on the store shelf, one with a "impact value" of 6 and another that costs $0.50 more with an "impact value" of 5. Some number of shoppers will be willing to pay a bit more to feel better about the purchase. The real heavy lifting here would be getting anyone to agree on how to calculate/regulate/audit the system for assigning the "impact value" of a product.

A number of highly-effective global organizations, such as Doctors Without Borders (Medecins Sans Frontieres, who won the Nobel Prize a couple years back) use versions of Radical Transparency for general management and policy-setting. Further, MSF characterizes itself not as an NGO/corporate entity, but as a 'movement' whose members participate in governance. For them, this system seems to work fine: the organization has grown manyfold in size over the past 20 years, operates on all continents, and successfully executes intervention programs under the most stressful conditions, all while spending less money on overhead (thus more on programs) than any comparable entity.

To succeed this way, though, it seems to me you need to have (as MSF does) an intense sense of mission, a self-questioning culture with high standards, and a highly-motivated employee-base that values field-relevant expertise and field experience (i.e., actual mission involvement) over other foci and/or metrics of excellence. Lacking these habits of mind, organizations may be more likely to veer gradually away from concern for "getting a job done" and towards concern for "having jobs," a stance encouraging growth of bureaucracy and the re-institutionalization of covert management and self-perpetuating hierarchy.