Fair Pay for Every Play, Ep 16: Erika Naponen on the Net Impact of the Music Industry
Utopia Music is conscious of its impact as a company, as well as the impact of the music industry as a whole. Together Kristian and Erika review the results of The Upright Project’s study into this.
In this episode of Fair Pay for Every Play, Kristian Luoma talks to Erika Naponen about a recent study they collaborated on into the net impact of the music industry on wider society. Visit sustainability.utopiamusic.com to download the full report.
Erika is the Client Projects Lead at The Upright Project. Based in Helsinki, The Upright Project is a technology company that has created a dynamic model that measures the net impact of companies on the wider world and communities.
“Our mission is to incentivise companies to start thinking about their net impact. This relates to their data and specifically data about sustainability and impact and how they can use it to measure their performance.
“For example, companies can use financial metrics that clearly show how they are developing and selling their products. But what isn’t well understood is how the company may be impacting on things like people’s health, the environment and society at large.”
Erika is a trained Environmental Economist and has a background helping to improve the impact of smaller and mid-sized companies by using data. She has been with The Upright Project for four years and has helped to build their net impact quantification model, which we discuss later in this article.
Here’s the notes:
00:00 — Introductions to our guest, Erika Naponen
01:20 — Erika discusses her involvement in tech company, The Upright Project
05:06 — How Utopia Music worked with The Upright Project to understand the impact of the music industry
07:42 — The results of the analysis
11:43 — How music impacts on society as an asset
14:25 — Explanation of how The Upright Project measures the impact
17:14 — Key takeaways from the conversation
18:11 — Thank you and goodbye
Utopia Music is conscious of its impact as a company, as well as the impact of the music industry as a whole. Together Kristian and Erika review the results of The Upright Project’s study into this.
Data can give us a greater understanding of society at large
The Upright Project recognises two key elements to a company which are their resource and their product or service.
Their quantification model suggests four categories that can be measured, these are: societal impacts, knowledge impacts, environmental impacts, and health. Within these categories are 19 more specific categories.
“We’re trying to get a very holistic picture of impact.” Erika says, explaining how these categories offer companies perspective of how they are impacting society.
“[The Upright Project] has developed this quantification model that uses scientific articles and knowledge, and machine learning technology to try and understand the impact of different products and services. This can then be summarised in a way that can be useful for people to use for making investments.”
The measurement is calculated as a net impact ratio with a top scoring positive impact rating of 100. 70 is considered positive, and value can go down into negatives.
From the data, companies can learn how they use recourses and how they can consider more positive alternatives.
The impact of the music industry and its resources
Utopia Music is conscious of its impact as a company and as part of the wider music industry.
We can understand the music industry and its financial value easily, but it is more challenging to look further than that due to the creative nature.
“The music itself is what defines the impact of the industry really. Obviously distinct business models make a difference, but music is so impactful itself. The different players working within the industry are getting their own impact from that, and that is highly net positive…” says Erika.
To conduct their analysis, The Upright Project took 50 companies from within the music industry: including publishers, labels, distributors, and customer facing services. They then defined the products and services and applied The Upright Project model.
The music industry scored largely positively.
“The resources that the music industry uses are human resources. These are skilled and creative people… this helps to create a huge range of positive impact within various categories such as offering jobs, tax revenues, and music providing peace and understanding between people.
“Really the music industry creates a lot of knowledge and then distributes that to people. Another highly positive thing is the positive health impacts because music makes us feel good and brings us meaning and joy.”
The impact of the music industry as a product
The Upright Project applied a similar investigation into music as a product. They evaluated the impact of investing in music by purchasing music copyright and owning music.
“There has been a shift in the conversation, and we’re trying to be part of it. That is to not only look at how we invest, but what we invest in and what the impact is of that investment. When you invest in something, you directly or indirectly are investing at the underlying assets. We’re starting to pay attention to the types of things we are supporting.”
Investors look at risk and return but music is something that investors can take a bit more of a risk with investing in and hoping for a high value return.
When an investment is made in music, it isn’t just in the sound recording or the work but rather investing in somebody’s creativity and your empathy toward them and how they were feeling whilst being creative. This of course impacts on wider society in what is considered to be a positive way.
Download the full study on sustainability.utopiamusic.com.
