Kalle reflects on a four-headed elephant in the economic room

Take away for leaders at all levels everywhere

Leaders everywhere are grappling with a sustainability debate clouded by four persistent misconceptions about the economy. Together, they create a perfect storm that stalls progress and obscures a fundamental question: How can the economy best serve strategies that create enduring value within the limits of our planet?

Fortunately, these misconceptions can be resolved. And when they are, they reveal opportunities for strategic advantage. The tool we will use to explore them is the Framework for Strategic Sustainable Development, or FSSD, a scientifically grounded and practical framework for aligning analysis, planning, and action.

The four-headed elephant: four misconceptions that block progress

First elephant head; “Economic growth is a goal”

It isn’t. Growth is a means to achieve societal goals like well-being, resilience, prosperity, and justice—not the goal itself. Treating growth as the prize distorts decision-making, encourages short-termism, and obscures the deeper question: growth of what, for whom, and at what cost? When leaders reframe growth as a tool, they unlock smarter choices about where and how to invest.

Second elephant head; “The economy is the most important tool”

The economy is one tool among many. Measuring the quality of education, knowledge management, governance, innovation, social cohesion, and the rule of law are equally essential. Mistaking the economy for the master tool pushes us toward “economism,” where narrow monetary signals override broader value creation. A truly strategic perspective recognizes the full toolkit—and orchestrates it toward shared, long-term objectives.

Third elephant head: “Infinite growth is impossible on a finite planet”

Not for value creation. It is only true for ever-rising material throughput. Material flows can be kept within ecological and social limits while value creation continues to grow. This requires accounting systems that enable us to: (i) define goals within robust boundary conditions for a sustainable society, at any scale; (ii) track progress toward those goals through strategic indicators; (iii) improve the management and sharing of knowledge; and (iv) recognize that even rapidly growing digital services must operate within the same sustainability constraints.

Such accounting makes it possible to focus planning, management, and governance on real improvements in quality of life. Only then can growth in value be decoupled from growth in material throughput and guided toward a more sophisticated understanding of progress, one that accounts not only for what should grow, but also for what must be phased out.

Fourth elephant head; “GNP is obsolete”

Gross National Product should not be trashed; it should be refined to work more effectively alongside other accounting systems. GNP captures useful information, but it misses important negatives and many forms of non-market value. Paul Hawken famously likened our current accounting to a calculator without a minus key: we even count the costs from depletion and pollution as gains.

Rather than discarding GNP, we should improve it by adding the “minus key” and complementary indicators that restore relevance and clarity. Only then can accounting help us distinguish between activities that strengthen our capacity to thrive within ecological and social limits and those that undermine it. Which material flows and investments should grow? Which should decline? And which should be phased out altogether?

More in detail

How the Framework for Strategic Sustainable Development (FSSD) turns confusion into strategy

The Framework for Strategic Sustainable Development (FSSD) is an operative system designed for exactly this complexity. It provides a rigorous, science-based way to:

-Define sustainability through clear boundary conditions for the (re)design of social and ecological systems within the absolute constraints that shape future possibilities.

– Backcast from success, designing pathways from a future-fit vision rather than extrapolating past trends.

– Prioritize actions that are directionally correct, flexible, and return-on-investment positive.

– Coordinate tools and initiatives—such as the SDGs, Planetary Boundaries, Circular Economy, and Science-based targets—so they reinforce rather than contradict one another.

Crucially, the FSSD avoids the trap of solving one problem by creating another elsewhere. It is profitable from the start when used to guide innovation and risk management, straightforward to implement, and engaging for cross-functional collaboration and co-creation.

From material flows to value growth: a more sophisticated measure

Economic growth need not—and should not—mean more tons, more throughput, more waste. It should mean more value per unit of material and energy, within robust sustainability boundaries. That requires:

– Modeling attractive, scalable future scenarios where life-support systems including forests, fields, oceans, infrastructure, and human capabilities—remain within the robust boundary conditions for sustainability together.

– Designing policies, business models, and technologies that make those scenarios achievable.

– Investing in innovation that improves quality, longevity, reuse, and service outcomes rather than pushing volume for volume’s sake.

Under these conditions, value growth can continue indefinitely. It may not be exponential, but it can be continuous and compounding, driven by knowledge, ingenuity, and better outcomes for people and nature.

Nature’s playbook: more value, not more mass

Nature offers a compelling analogy. Over eons, ecosystems have evolved toward greater complexity, specialization, and resilience without increasing planetary material flows. From cyanobacteria to today’s rich biodiversity, the “value” of functions—intelligence, cooperation, adaptation—has multiplied while the total mass remains bounded. Humanity, uniquely, can compose symphonies, cure diseases, exchange knowledge globally, and reflect on its future—tremendous value gains with prudent material use.

The economy should emulate this: economize on limited resources while maximizing value. That is what the economy was originally designed to do, and it is what policymakers mean by decoupling, a goal endorsed by the EU and many national strategies. In practice, it means phasing out harmful flows, scaling essential and circular ones, and continually improving the sophistication of materials, products, and services so that more value can be created from fewer resources.

Don’t trash GNP—upgrade it and surround it with better metrics

There is no need to toss GNP out with the bathwater. The economic system has elegant features and useful signals that can be preserved and improved. What’s required is:

– An upgraded GNP that applies Hawken’s minus key—deducting environmental degradation, social harm, and perverse incentives.
– Accounting reforms that counter short-termism: for example, recognizing the negative externalities of bonus systems and discount rates that reward near-term extraction or speculative gains instead of stepwise progress toward labor productivity, shared prosperity, and long-term success.

– Taking the other accounting systems mentioned above into account, so that the economy can function as part of an integrated and mutually reinforcing system.

In this way, the discourse shifts from false choices—growth or no growth, economy or environment—to a strategic synthesis: growth of real value within ecological and social boundaries.

Practical next steps for leaders

– Adopt the Framework for Strategic Sustainable Development to set science-based boundary conditions and backcast from a future-fit vision.
– Redesign metrics: upgrade GNP accounting and add dashboard indicators for what markets miss.
– Align incentives: reward long-term value creation, penalize depletion, and phase out subsidies for wasteful throughput.
– Build coalitions: engage economists, scientists, educators, and policymakers to coherently coordinate tools like SDGs, Planetary Boundaries, circular economy, and science-based targets.

Conclusion: clarity over semantics, strategy over stalemate

Much of today’s argument is semantic rather than factual. When we distinguish means from ends, the path forward becomes clear. With the Framework for Strategic Sustainable Development, leaders can cut through the noise, design strategies that grow real value forever, and keep material flows within the planet’s limits. Let’s invite economists and sustainability practitioners alike to refine our measures, upgrade our incentives, and get on with leading a future that is both prosperous and sustainable. The four-headed elephant shrinks when we measure what matters, innovate within boundaries, and use the Framework for Strategic Sustainable Development to turn vision into action.

[1] Fact Box

The FSSD Operative System “ABCD-in-Funnel” is the shared foundation behind the organizations Stepwise Global and Stegvis, Kalle’s Reflections and their associated podcasts, and related applications.

Funnel: It refers to that the ABCD planning occurs in a global context, where all vital subsystems are gradually declining, per design, until civilization would not be able to support itself anymore; Forests, Cropland, Water-tables, Biodiversity, Social trust.

Boundary conditions: Eight hands-on conditions for operationally defining the opening of the funnel: In the sustainable society, nature is not subject to systematically increasing…

1 …concentrations of compounds from the earth’s crust, e.g. fossil coal and metals.

2 … concentrations of compounds from societal production, e.g. nitrogen oxides and CFCs..

3 …degradation by physical means, e.g. overfishing and large clear-cuts.

felt as self-evident as gravity.”

…and in that society, people are not exposed to structural barriers to

4. health (e.g. working conditions),

5. influence (e.g. polls),

6. competence (e.g. education programs),

7. impartiality (e.g. composition of boards) and

8. meaning-making (e.g. purposeful missions).

ABCD:

A = Desired future state, modelled within the eight boundary conditions for sustainability.

B = Current reality in relation to A, revealing the gap between present conditions and the desired future.

C = Brainstormed actions capable of bridging that gap.

D = A strategically prioritized action plan derived from the C-list.

For deeper exploration, please refer to the resources listed below.

________________________________________

References

The science of the Operative System with references Operative System for Strategic Sustainable Development—Coordinating Analysis, Planning, Action, and Use of Supports Such as the Sustainable Development Goals, Planetary Boundaries, Circular Economy, and Science‐Based Targets” published in Sustainable Development (Volume 33, Issue 4, pages 4759–4774)

For more Reflections, Podcasts, Applications and Courses in general

https://www.stepwise.global/

Related Reflections of relevance for this particular one on Growth (e.g. for the Reflection on Growth below)

• The four-headed Elephant in the Economic room (first choice for this reflection).

• Erosion of Terms Behind Unclarity of Minds

• Karin Pettersson’s bok on Zombie Capitalism, “Förbannelsen” (“The Curse”)

• Backcasting for Strategic Thinking and Ways of Muddying Waters

• Low Consumption Society: Risky Myth vs. Solutions

• An Attractive Sustainable World at A

• ABCD Workshops and Their Psychology

All hot topic Reflections are direct consequences of our Operative System.

For a deeper dive into the science behind the Operative System that informs all Reflections, see the peer-reviewed Open-Source paper with all its references: doi.org/10.1002/sd.3357. For the full title, see footnote below.

Or, for concluding reflections, practical insights and training, click on “Kalle Reflects” to see all reflections.

If you need any further advice, perhaps getting some further references, please send a question to us from the homepage.

Footnote: Broman, G. I., & Robèrt, K.-H. (2025). Operative System for Strategic Sustainable Development―Coordinating Analysis, Planning, Action, and Use of Supports Such as the Sustainable Development Goals, Planetary Boundaries, Circular Economy, and ScienceBased Targets. Sustainable Development, 1C16.The FSSD Operative System “ABCD-in-Funnel” is the shared foundation behind the organizations Stepwise Global and Stegvis, Kalle’s Reflections and their associated podcasts, and related applications.