The Business Case for True Pricing
Why you will benefit from measuring, monetizing and improving your impact.
Resource scarcity, population growth, economic development, lower transaction costs and more effective regulation: companies face a ‘new normal’. Impacts upon society that arise outside of the market – externalities – are growing, and yet companies simultaneously face the prospects that they must internalize such externalities at higher rates than ever before.
For example, the mining industry has increased spending on water by 250% from $3,4bn in 2009 to $12bn in 2013 (GWI, 2014) and the average annual in-crease in minimum wages in China in 2011-2015 is 13% (China Briefing, 2014). As a consequence, factors that previously were not priced, such as water or underpayment, are increasingly priced and impacting companies’ bottom lines. Organisations can anticipate and stay ahead of this trend by engaging in true pricing. True pricing is the monetary valuation of social and environmental externalities. It is a new framework that leverages new technologies, which allows organisations to quantify their societal impacts.
This report is the result of a public consultation period. Experts and professionals have provided input on a consultation draft of the report, through interviews and an online consultation form. All input has been processed and the text was edited for a final version of the report.
The report can be downloaded here
Tags: Communication | Extractive Industry | Consumer
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