It took an accounting book to teach me the importance of Indigenous peoples’ connection to ‘Country’

Mar 18, 2021

It is said that Einstein’s Theory of Relativity came to him as he was leisurely riding a bike. Christopher Stone’s inspiration to write a potentially world-changing paper came to him as a result of a flippant question he posed to a law class he was teaching in 1972: Should trees have rights? Both changed the way planet earth should logically be viewed.

According to Jane Gleeson-White in her recently re-published book Six Capitals – Capitalism, climate change and the accounting revolution that can change the planet, initially Stone was simply committed to showing that his idea was not incoherent. To do this, he set out to find a pending case to test his nature-centred idea of rights. His library quickly found such a case for him, involving the Mineral King Valley in the Sierra Nevada mountain range of California, at the time entitled Sierra Club Vs Hickel (1969). The sierra Club was appealing a development approval granted to Walt Disney Enterprises to develop a tourist and residential complex in the Mineral King Valley, on the grounds that it would do unacceptable damage to the valley environment.

When Stone came to it the case had been docked for review by the US Supreme Court under the name Sierra Club Vs Morton. He wrote his paper entitled Should Trees Have Standing? – Towards Legal Rights for Natural Objects in time to have it presented in that case. In the paper, Stone argued that if rights in law as ‘persons’ had been granted over the years to slaves, women, ships and even companies, then surely that same status could be given to natural things like trees, rivers and the environment more generally. The case was lost, but one dissenting judge wrote: “Contemporary public concern for protecting nature’s ecological equilibrium should lead to the conferral of standing on environmental objects to sue for their own preservation”.

That eventually led, in 2006, to Pennsylvania’s Tamaqua Borough passing the first ever law recognising the rights of nature. A lake, the sole water supply for a town, was granted the right to sue in its own name to protect and preserve itself. But let’s take a step back in time.

In the early twentieth century US case law had seemed to enshrine a principle requiring a company to operate exclusively for the profit of its shareholders, a line of argument strongly promoted by Milton Freedman as late as the early 1980s in his vigorous promotion of the neoliberalism advocated by the Chicago School of Economics, and by Margaret Thatcher and Ronald Reagan. This theme was influentially argued by Milton Freedman in a paper published in September 1970 in the New York Times Magazine emphatically titled: “The Social Responsibility of Business is to Increase Its Profits”.

To support his argument Freedman used a finding which emanated from a 1919 case called Dodge Vs Ford Motor Company. Henry Ford had decided to spend some of his $60 million capital surplus reinvesting in new plant, rather than paying it out as dividends. The Dodge Brothers, large shareholders in Ford, took Ford to court demanding the dividends they believed were rightfully theirs. At the trial Ford argued that his company wanted to employ more men because he saw it as “an instrument for social service, not just for making money”.

The Michigan Supreme Court rejected this reasoning and found in favour of the Dodge Brothers. That case is frequently cited to argue that US case law requires company boards to maximise shareholder profits ahead of all else.

Fast forward to 15 October 2012, when Bolivia passed the world’s first law granting all nature equal rights to humans. The law created a Ministry of Mother Nature and an ombudsman to advocate for the rights of nature. The law makes the conceptual leap that Stone postulated in 1972, by breaking down the distinctions between humans and the natural world, and seeing them as part of an interconnected continuum.

When Jane Gleeson-White wrote Double Entry in 2011 she says she set out to show the significance of double entry bookkeeping to the material success of the Renaissance in fourteenth-century Italy, but it evolved into the seminal work on the history of accounting. In the foreword to her 2014 book Six Capitals, republished in 2020, she writes “(This book) charts the rise of four movements designed to address some of the key problems of our times, including the inordinate power of the modern corporation and the invisibility of the earth’s living systems in global economic and accounting measures. The movements are: the push for a new corporation, the B (for Benefit) Corporation, which is legally bound to benefit society and the environment while also making a profit; multi-capital or integrated reporting, which accounts for the wealth of society and nature as well as profit; natural capital and ecosystem accounting for nations; and the burgeoning ‘rights of nature’ movement, which resonates with indigenous earth-centred laws and cultures.

“Together these changes are critical for the future of human life on this planet. Why? Because they extend the responsibility of corporations beyond purely profit-making to a legally binding requirement to operate for the benefit of nature and society; and they grant natural entities legal standing to fight for their own protection against corporate omnipotence, thereby recalibrating the respective power of corporations and the natural world.”

Six Capitals recounts how, gradually over time, the extension of corporate responsibility beyond simply profit maximisation for shareholders has gained momentum. “A new generation of corporations, conceived by an organization called B Lab, has taken the idea of corporate and social responsibility to include society and the environment. B (for Benefit) Companies are legally obliged to make a material positive contribution to society and the environment. B Lab’s mission is to make benefit corporations possible in all 50 states of the US by asking state legislatures to amend their corporate charters so companies can be incorporated with explicit social and environmental objectives. By the beginning of 2020, 36 states had passed benefit corporation legislation and five states were working on it.” Even Delaware, where most US companies are registered so as to take advantage of minimal reporting requirements, has passed legislation to facilitate the incorporation of benefit companies, apparently for fear of losing businesses to other states.

The book makes several references to the wholistic relationship indigenous cultures in various countries have with the environment. It also documents the progress being made worldwide in accounting for the totality of the environment in which businesses operate, including the social environment, along with the many and complex practical difficulties and pitfalls in doing so. One early approach was to give every impact of the corporation a dollar value, and report on that. George Monbiot quickly pointed out the risk that damaging environmental and social impacts could simply be treated as costs of doing business, thus causing very limited behavioural change. He referenced the childcare centre in Israel which imposed fines for late collection of children, only to find that late collections increased.

Whilst I was encouraged by the account of the endeavours of accountants to put appropriate values on ‘externalities’ and to treat them accordingly, my biggest take-away from this book was an embarrassingly belated realisation that when Australia’s indigenous people refer to a bond with ‘country’ they are not just talking about the place they came from. Rather, they are surely referring to the inextricable bond they feel with all of nature and society. What is now amazing to me is that we non-indegenous DON’T yet seem to feel that same bond and commitment to the earth; to the totality of our environment.

How could we humans ever have conceived a concept as delusional and narrow minded as a corporation whose sole responsibility was to maximise profits for its shareholders?

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