This report provides a comprehensive review of True Cost Accounting (TCA), conceptualised as an evolving holistic and systemic approach to measure and value the positive and negative environmental, social, health, and economic costs and benefits associated with agrifood systems. Grounded in welfare economics and environmental and ecological valuation, the report traces the intellectual foundations of TCA and clarifies its distinction from related approaches. It develops a functional taxonomy of TCA applications across product, business, and policy or regional scales, mapping actor-specific roles and decision levers from farmers and firms to regulators and civil society. The report outlines a four-step methodological process consisting of Framing and Scoping, Measurement and Valuation, Integration and Interpretation, and Application, and synthesises a pluralistic toolbox of impact assessment and valuation methods, including Life Cycle Assessment, Environmental Impact Assessment, shadow pricing, damage-cost approaches, contingent valuation, choice experiments, hedonic pricing, travel-cost and replacement-cost methods, and multi-criteria decision analysis. In addition, the report examines the data ecosystems required to operationalise TCA, discussing the complementarities and trade-offs between primary and secondary data, qualitative and quantitative sources, and the importance of interoperability and transparent metadata standards. It critically reflects on practical and epistemological limitations, including data gaps, lack of harmonised indicators and terminology, modelling complexity, and normative assumptions. The report concludes with five recommendations to strengthen TCA as a robust and equitable accounting standard, focusing on improved data quality and transparency, clearer scope and baselines, methodological harmonisation, dynamic modelling, and enhanced valuation practices.
Contor et al. (Sun,) studied this question.