”Triple Bottom Lines” for Companies

Some businesses make lots of money while doing really bad stuff, such as exploiting people and causing pollution. Some businesses make lots of money while doing some good things, often by having some kind of foundation linked to the company. And some businesses make money by doing good things, such as Ecotricity, for example. This last category is what I want to write about today.

Companies that create economic value not just while but actually by creating social and environmental value.

I’ve been reading the New Economic Foundation’s (nef’s) report called The Great Transition (free to download) which has this idea as a central principle. They write that we need to undergo a ‘great revaluing’ which would make the prices of goods and services reflect their true costs and benefits. This at the moment is not the case. As you will be well aware, environmentally and socially responsible items are often much more expensive than ‘orthodox’ damaging alternatives. A good example is organic food being more highly priced than non-organic. After such a revaluing, the price of paying fair wages and either preventing or clearing up any pollution and attending to other side effects of production would be factored into the price… So ‘’good’’ goods and services would end up being cheaper than ‘’bad’’ ones. This would completely change everything. It would make the good choice the easy and normal choice.

Coming back to business, did you know it is actually corporate law that companies must place generating profit for their shareholders above anything else? Nef thinks that instead of sole focus on the bottom line, companies should have to produce value across a ‘’triple bottom line’’. That is, across the environmental, social and economic sectors. That way making money would still be important but it would be one of three main objectives. Or, another way of looking at it would be that a company’s main objective is to create social and environmental value, and that money is what they get as the reward for doing their job effectively.

Imagine that?!

After being unemployed for ages, I’m now working full time in a local vegetarian café and saving up for uni. The reason I’m telling you this is so I can comment on how much I like the feeling of camaraderie that comes from being part of a team and collectively getting something done. Of course that relates to any form of organized action, but there’s no denying that business is definitely a powerful and impressive feature of society. Through businesses, things are achieved that would never of been if just left to a bunch of individuals. I mean, it’s a part of evolution and a pre-requisite to civilization, isn’t it, to specialize and organize each other and make bridges and hospitals and art galleries and everything. And although it’s easy to criticize power and money (especially when you have little of either) it is astonishing how they motivate a group of people and cause them to work as an efficient team.

My point by all this is just that business is a powerful tool, and it’s my school of thought that powerful tools are best ‘’put to good use’’ and certainly not fought against of anything tiring and pointless like that. In the world today there are hugely destructive businesses that could easily be blamed for many problems in this world, and there are also many inspiring innovative and positive businesses to be happy about. I’m inspired by nef’s vision and hope that in my lifetime I will live in a society where businesses have to take a triple bottom line approach… Where every year they showcase their achievements across the environmental, social and economic sectors. Where co-operatives are common and employees are often shareholders of the companies they work for. Where companies are heavily fined if they cause pollution and the money is used to clean it up. (Meaning it’s better for them to not do it at all). Where prices of stuff in the shops reflect the true prices, so the most ethical products are the cheapest ones. Where local businesses are crucial assets to their communities and supply quality jobs and training schemes… And benefit the environment rather than ‘damage it as little as our budget allows’.

I hope to see all these things come to fruition, and as soon as possible! Wouldn’t it just transform things so amazingly if the best and easiest way to make money was by making a positive effect on your environment and society?

Things like this will only happen when the next wave of entrepreneurs, politicians and economists take the reins, and that’s us, isn’t it? So come on, let’s get down to business!

Sign to end fossil fuel subsidies!

http://www.avaaz.org/en/a_new_plan_to_save_the_planet/?slideshow

Click the above link to sign an incredibly important, indeed vital, petition.

Basically the world’s governments outrageously give out roughly a trillion pounds per year to the big oil and coal companies that are driving us towards runaway unstoppable climate chaos. President Obama apparently wants to end this and is chairing a meeting in 3 days of a few of the world’s most powerful leaders. The proposal is to divert this mammoth sum of money away from polluters and into investment in renewable energy instead. If it is agreed upon, can you imagine what an enormous turn around that would be?

The brilliant website Avaaz has put out this online petition and it has over 600 thousand signers. There’s a little feature where you can see each new name popping up on the screen one after another, constantly, from all over the world. People clearly want this. Their aim is to get it to a million signatures, so please, take a minute from your day to add your voice to the mix. The reason governments do nothing about this is because they want to protect the status quo and are scared of being unpopular and voted out. Cowardly but true. So let them know we all want a green future for this planet!

Click the above link and sign sign sign!

Reblog this, tell your friends, link to the petition on facebook, twitter or anything like that. Spread the word!

A ”Closed Loop Economy”

I’ve been giving some serious thought to what kind of economy/society we could have to replace our current model of waste and exploitation that will soon be breaking down. (Please see earlier posts about why and how. In this post I want to focus on what could be next).

I think what we should have is a closed loop economy. This means that it will consist of closed loop systems which produce no waste because every output acts as an input to another system, creating a complex and interconnected web – much like a natural ecosystem. So for example, you would use the inputs of paper, wood, time and energy with a wood-burning stove to get the outputs of heat, light, ambience, smoke and ash. The first three are the desired products – but smoke and ash are not necessarily desired. However to close those loops you would need to find useful things to do with them. Ash could be added to a composting system (heap) to create highly useful compost. Wood smoke could perhaps be used to smoke foodstuffs in the chimney? This is only a basic example, and it would take more effect when applied to some thing like a manufacturing system. Every output is linked to a position where it can be a useful input, not just left in an inappropriate place to be a pollutant. Think of every by-product as an opportunity. Consider the most useful by-product in the world: Oxygen. It’s a side-effect of green plants’ photosynthesis, but does it go to waste? Hell no! Not only do the plants use it themselves in aerobic respiration, it makes the entire animal kingdom possible with this same essential function. I doubt we have any other things that have quite that much potential, but I guess you never know! The general principles of permaculture are highly relevant to this. The main idea is to let nothing go to waste, and to create as many links and relationships as possible.

And it’s not just connections between systems that we want, it’s social connections as well. Communities should be designed for as many positive social links as possible, making them more resilient. Lastly, diversity is paramount. In an ecosystem, the higher the biodiversity is the stronger the ecosystem is. This is the case pretty much across the board… Farms are more productive per acre if they have a wide diversity of crops and products, communities are more interesting and have a larger communal skill set if they have a diverse variety of types of people living in them.

My thinking behind all this is that wouldn’t it be good to base our human socio-ecosystems on  natural ecosystems? Nature has had billions of years to get good at design – much longer than us. Natural systems are cohesive, resilient and productive, and are obviously not hugely damaging to the whole planet like ours are. Please don’t confuse this for me saying we should all go back to being hunter-gather-ers or something. I’m all for civilisation! Like, real civilisation, where we create healthy and meaningful lives for everyone in the world (not just the top fraction), where we work with and in harmony with nature and act as stewards for the Earth, where we are bathed in rich and vibrant culture and have made peace among nations – focusing instead on developing our full potential. Civilisation which we are yet to know and enjoy, basically. So yes, I think it would be great to design our human systems to be as similar to wild ecosystems as possible. But of course we’re going to design them to suit our needs. Hopefully, in a way that meets them more fully than what we have now. We are a part of nature, but at the same time we can hardly ignore the fact that we’re different to any other creature, and so obviously have different needs. We need to just take the principles of design from wild nature and adapt them in ways that suit us. Our cities are not going to look quite like forests, although a lot more green spaces wouldn’t go a miss. We should celebrate our place in nature, and then also celebrate what makes us human. I mean, animals haven’t caused climate change, but they do kill each other’s babies on a frequent basis. We don’t go a bundle on that. So let’s take the framework of natural ecosystems, and then build on that with our positive human elements… Empathy, ethics, consciousness, art, music, culture, science, technology, curiosity…

Sooooooo… Your thoughts on my thoughts?

Look, David Cameron Thinks So Too!

So I’ve recently finished reading The Great Disruption which outlines how the author believes we will experience the end of economic growth some time within the next decade or so, due to the fact we’ve now reached some of the planet’s limits and are about to hit the rest. In my posts The Great Disruption – A Kind of Review and The End of Bigger Is Better I gave my comments on this, and on what could come afterwards.

Now, just a week later, the prime minister of the UK is warning us we could face a decade-long depression! I watched the BBC News last night and it was all bad news and alarm bells about the economy. They said the debt-stricken Greece is not far away from a bank run and the Euro is in trouble. There was exclaims about a halt to growth, which made me sit up and listen, and David Cameron said that if this Euro problem (that I don’t entirely understand) doesn’t get sorted out quickly then Britain could be thrown into a long, non-growing depression. When I went to the shop today the story was emblazoned over every newspaper. I can’t believe this is happening just days after I started musing about pretty much this…

There’s bound to be twists and turns, ups and downs and false alarms, but is this the beginning of the end?

“The future is not some place we are going to, but one we are creating. The paths are not to be found, but made, and the activity of making them changes both the maker and the destinations.”

- John Scharr, Futurist

Story of Stuff

Have you heard of the Story of Stuff? It’s a friendly animated-documentary about the unfriendly issue of consumerism and unsustainable production. Narrated by Annie Leonard and produced in 2007, it’s a fantastically accessible way to learn a lot as the information is presented in a light hearted way with cute animations. It’s free to watch and share, so have a look!

This little gem caused such a stir that it’s now grown into a whole organisation, called the Story of Stuff Project. They’ve since made loads more productions in the same style, such as the Story of Cap & Trade, the Story of Cosmetics, the Story of Electronics (all on their website) and now they’re working on the Story of Change. If you like what they’re up to then why not donate? They don’t charge anyone for the use of their films as they want the message to be flung as far and wide as possible… But that doesn’t mean they don’t cost money to make.

I think this is great because the films, like I said, are really quite easy-watching so the audience is much wider than for something dry, factual and depressing. This is really important because it’s power in number’s and everything… Any way to reach out to the masses is gold dust.

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Also, after looking at their website for the first time in a while I’ve been watching the Story of Broke. It’s about how the American government collects everyone’s taxes but then says their too broke to build the better future the people want – the one with more jobs, better health care, clean air and water, and quality education. But of course the USA isn’t broke at all, it’s the richest country on Earth. The only problem is they spend most of the people’s taxes on the military, bailing out irresponsible banks and giving away huge subsidies to polluting and unethical corporations. The short film assures us there is enough money to create the future we want and we have to demand our money is spent on this goal. Here it is:

Enjoy!

The End of ‘Bigger is Better’

Lets talk about growth and improvement. As I outlined in this post, sooner or later (and most likely sooner) the world economy is going to have to stop growing. At the moment our progress is pretty much entirely measured by economic growth… But as they say, you can’t stop progress! And I’m not suggesting for a second that we should or will give up on advancement. Things will always change, and preferably, for the better. We will continue to invent new technologies and make existing ones better… We will continue to improve medicine, refine scientific understanding and create new art, literature and music. Hopefully quality of life will steadily improve as times roll on. But we must do all this without economic growth. You see, we don’t have indefinite resources. We need a rethink.

In The Great Disruption the author talks about us graduating to what he calls a ‘steady-state’ economy. This basically means an economy that doesn’t grow, but stays at a steady state. He didn’t go into much detail about how this could be achieved or what it would look like. He did however stress that it would mean things would still advance and develop, but there would be a focus on quality and improvement rather than quantity and growth. Well, that makes sense. He also writes at some length about a more equal distribution of wealth, which would apparently increase the well-being of the whole population, not just the section that benefited directly. He says he thinks people should be paid different salaries depending on the job they do, and that exceptional effort and achievement should be rewarded financially – but suggests the filthy rich and the struggling poor should just be kind of squashed in a bit towards the middle. I must say I agree but that’s possibly going off at a bit of a tangent. Let’s get back to this steady-state economy.

I’m thinking about what it would be like and I want to share some speculation. I think a steady-state economy would have these features or aspects:

• Powered by renewable energy –  free, clean, always there and won’t send shocks around the market as they dwindle.
• Huge focus on recycling – everything will be recycled to reuse the materials and avoid the need for virgin ones that may not even be available. Things will be designed to be taken apart and recycled at the end of their use.
• Cradle to cradle design – items designed with their whole life cycle catered for, reincarnation included!
• A shift from goods to services – to encourage efficiency from the service provider and make designed obsolescence obsolete. e.g. you don’t buy carpets but pay for a carpeting service.
• Quality is better than quantity -
• Experiences are better than things -
• It will be much much cheaper to have things repaired than replaced.
• People spend more money on services and experiences rather than physical stuff. e.g. a massage, a concert ticket, or a subscription to a gaming website rather than a back scratcher, a new DVD player or an Xbox.
• A fashion for ‘less is more’ and simplicity -
• People socialising more and shopping (at least for new stuff) less.
• People sharing large items – e.g. one lawnmower for several households on a street.

Those are just some thoughts. What do you think it would be like? I’d love to hear your ideas in the comments section!

It’s All About Ethical Knickers

(Images from whomadeyourpants.co.uk)

Flicking through a magazine the other day I came across an advert for Who Made Your Pants? (I’ll refer to them as WMYP) which is a worker’s co-operative based in the UK where they make beautiful lacy knickers out of fabric that is sold on by big lingerie companies at the end of the season, thus diverting it from landfill. The material is in good condition, it’s just that it’s left over and the companies are wasteful. Anyway, I had a look at their website and the pants are gorgeous. I want to own every pair! What’s more, they’re produced in good working conditions and the brand is even actively working to empower disadvantaged local women. Basically, Southampton, where their factory is, has a high population of women refugees from war-damaged areas in Afghanistan, Somalia and Sudan who are often highly isolated. Many of them have never had a job before and haven’t been through education. WMYP employs these women and offers them training and support. They start off working on the production line and after a period are invited to join the co-op, meaning they have a vote in how the business is run and own part of it. They are also offered training to go into other areas of the business, such as marketing and finance. And if you really do want to know who made your pants, you can find out. Every pair has a little swing tag with the date of it’s manufacture on it. You can type the date into a clever app on their website and it’ll tell you who was working on the production line that day. How’s that for transparency in business?

On the about page of their website, is says:

”Who Made Your Pants? is a campaigning lingerie brand based in Southampton, UK. We’re about two things – amazing pants, and amazing women.”

Well how great is that? I think WMYP is awesome because they produce a high quality and beautiful product, whilst making a positive impact to the lives of people in their local area and reducing the amount of waste going to landfill. This is such a great example of what I call a ‘future-facing’ business – a business that makes money out of doing good.

So why don’t you treat yourself to some pretty, ethical lingerie that’s bound to make you feel amazing? Or for you male readers… Don’t you think your lucky lady would be over the moon to receive such a gift? I’m sure she’d be singing your praises for weeks to come! At a price ranging from £12.50 - £28.00 per pair, (mostly £18.00) my only criticism is that they seem a bit on the pricey side.  However, we’re probably all just a it too used to cheap garments with the real cost being borne by other people besides us… This is most likely just the price you pay for a quality product made with fair labour.

So anyway, I’d like to offer my congratulations to Becky, the WMYP founder, for starting something so great. I’ll be treating myself as soon as I’ve brought a Sunrise ticket!

The Great Disruption – a Kind of Review

I’ve just finished reading The Great Disruption by Paul Gilding. I finished it in half a week, not being able to do much else until I’d absorbed every page. It was fantastic. Kind of like a slap in the face, a call to arms and a breath of fresh air all at once.

Okay, now I’ll rewind a little and tell you what it’s actually about without getting so abstract and ahead of myself. (I’m terrible for that). It’s subtitled How the climate crisis will transform the global economy and it’s basically about how over the next few decades we will globally go through a massive transformation as we are threatened by climate change, resource peaks and other ecological limits, suffer the crash of the world economy and eventually build a new ‘steady-state’ economy based on well-being, sustainability, and a focus on qualitative improvement rather than quantitative growth.

The way he covers climate change is refreshing. Many people are still talking about it in terms of ‘if we don’t do something soon we’ll be in danger because of climate change!’. Paul instead says that was thirty or so years ago, we didn’t do anything, so now climate change is already under way. What’s more, due to the length of time it takes for pollution emitted now to take on it’s full green house effect, even if we stopped emitting CO2 tomorrow we’d still have a large climate change problem for decades to come. The icecaps have been melting since 2008 and low-lying islands are already struggling with the sea-level rise. We didn’t listen and climate change is no longer avoidable. All we have to worry about now is adapting to and surviving its effects while not only stopping CO2 pollution but actively removing it from the atmosphere to keep average levels of warming to no more than 1 dangerous degree.

He also recognises that climate change is just one of many ecological limits we’re currently hitting up against. He says that although the environmental movement is gathering power and numbers daily, the majority of humanity will not act until the effects of ecological meltdown (e.g. extreme weather and sea level rise from climate change) are everywhere, severe and obvious for all to see. He thinks that when it comes to that point, the mass reaction of denial will quickly evaporate as we globally fly into action. He says that governments and all sectors of society, once they can see with their own eyes that all of civilisation is at stake (i.e. not just polar bears), will fully engage and act in a terribly late but impressively fast war-like fashion. …Great, so when is this magical point in history? Not actually very far away at all… He estimates around 2020 will be when we start to really buckle down and get to work on this. He artistically calls it The Great Awakening. In case you were wondering, the Great Disruption mentioned in the title refers to the combined forces of the economic crash Gilding forecasts and the ecological crash that will cause it. The reason for this is simple. Infinite growth on a finite planet is impossible. Not morally wrong, but impossible. Economic progress is basically about using natural resources to manufacture stuff, which is transported around the globe to consumers who use it for a little while before throwing it out (usually into landfill) and buying more stuff to replace it. This is already happening way faster than key resources such as oil, timber and fish, can be replenished. This problem however is only getting worse because the population as you know is rapidly expanding, and the ‘consumption rate’ of each person is growing every year. This is actually how we measure our progress. Economic growth is supposed to bring the word’s poor out of poverty and make life even better for the ‘lucky billion’. As the world isn’t getting bigger but the demand most definitely is, it’s common sense that we’ll hit a limit to growth soon. No one can really argue about that. What people do argue about is when that limit will approach and what we can do to delay it. According to Gilding  (and many scientific sources that he quotes) that limit is now being reached and that’s why economic growth has met it’s demise. He says the economy will enjoy a temporary boom when we start to truly tackle what will then be a climate crisis with surprising innovation in business and especially huge investments in the renewable energy industry, but that it will be a short lived thing – that the death of growth is unavoidable and coming very soon.

So this Great Disruption will be a crisis with environmental, social and economic aspects. (e.g. coastal areas being flooded, climate refugees and loss of homes, property devaluation and loss of income from tourism…) Gilding says it will be a crisis like nothing we’ve seen before and will ”shake us to our core”. He says when it comes to it, we’ll have only two options. One is to descend into chaos and look on as temperatures trip over the critical 2 degrees causing runaway climate change at an exponential rate which will make the earth inhabitable for most life, including humans. The other is to mobilize the whole species into saving our selves from collapse. He argues that although humans are slow and selfish, they also want to live and are good in a crisis. He says after long periods of doubt, he is now sure that we will make it through. Not without large doses of suffering, anarchy and conflicts over resources and refugees, but that we will get through this phase and will even be able to create a new economy and social system that is better than our present model. That life will be greener on the other side. He even suggests that this transformation will be the next development in humanity’s evolution.

He writes all this in an engaging way, with a style that is intelligent yet accessible.  The tone is of realism flirting with optimism. He does not in any way under estimate the scale of the challenge ahead, in fact he emphasises it’s hugeness at every turn. However his core message is that despite the odds against us, ultimately, we can succeed.

All I can say is:

Wow, don’t we live in interesting times?

I whole heartedly recommend this book – it’s a fascinating read.

”Anyone who believes exponential growth can go on forever in a finite world is either a madman or an economist”.

- Kenneth Boulding