2021: Creating a Lexicon of Future

S is for Soft Capital

There are two classes of capital, which are expressed in multiple forms.

Monetary capital — aka ‘Hard’ capital — is easily measured. Examples include money, land, equipment and other forms that have an objective value in the marketplace.

Non-monetary capital — aka ‘Soft’ capital — is more subjective, yet essential to the sustainability of a business or community. It can take many forms including quality of service, core values, ability to communicate, trust, loyalty and personal satisfaction among innumerable others.

Difference between monetary and non-monetary assets:

Difference between monetary assets and non-monetary assets (source: Terms Compared):

1. Meaning

• Monetary assets are assets having a specific cash value that will most likely be received when liquidated.
• Non-monetary assets are assets for whom specific cash value that can be received is not fixed and can keep changing over time.

2. Ease of liquidity

• Monetary assets can be fairly easily liquidated and converted to cash.
• Non-monetary assets are relatively illiquid i.e.: they cannot…