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Inclusive Wealth

Since Canada does not have a way to include natural capital in our national accounts, we are not able to use and conserve it at an optimal rate.  We risk living beyond our means and imposing a significant ecological debt on future generations

The dominant measurement of economic well-being (GDP) is an income metric, not a wealth one, which makes it difficult to incorporate declines in our ecological wealth. We can start with other wealth-based measurements (balance sheet, savings) and work way up to subtracting the rents on depleted resource stocks or adding it in the case of new discoveries in our national accounts

The Inclusive Wealth Index and UN System of Environmental-Economic Accounting have set a practical basis that is fast-evolving. Of all OECD nations, Canada has the most abundant natural capital per capita, and also an impressive data set, which StatsCan has tracked for three decades.

Initiatives

Include natural capital wealth in our national accounts by:

  • Listing it on our national balance sheet
  • Subtracting the rents on depleted resource stocks in our national accounts (or add, in case of new discoveries)

The seminal Inclusive Wealth Report provides guidance on how to proceed.

Examples of successful implementation

  • In preparation for Rio+20 summit, IHDP and UN University devised the Inclusive Wealth Index, the first framework for national accounts, and tested it with 20 countries, including Canada

  • Australia includes natural resources on its national balance sheet

Resources