Capitalism is outdated; is there a better alternative?
by David Laing
“We need to act like our future depends on it”; that was the opening line for the Capitalism 2.0 seminar, December 5th 2012, organized by the Toronto Sustainability Speakers Series (TSSS).
The quote was from a recent TED talk by Paul Gilding, an Australian environmentalist, consultant and author. In his TED presentation Paul stated that our economy is a system operating past its limits and outgrowing the earth’s ability to support it. He argued that, rather than increasing happiness and well-being for the majority, the economy increasingly concentrates wealth in the hands of a few, demands ever increasing levels of workforce productivity, insatiably consumes increasingly scarce resources while spewing toxins into an increasingly less hospitable ecosystem. Following the laws of physics, he said, it will break down and the breakdown is already starting.
Paul is not alone in his terrifying prognostications. Corporate leaders and economists are joining environmentalists in saying that Capitalism 1.0, the capitalistic society based primarily on growth and greed that we have come to know and love is unsustainable and needs a major overhaul. The Capitalism 2.0 seminar was designed to get us thinking about what is possible and what is needed to drive change.
First up at the seminar was Joyce Sou from the MARS Centre for Impact Investing who told us about B Corps. Unlike standard corporations whose primary objective is maximising profit, B Corps are legally bound to pursue a triple bottom-line that objectively measures their positive contribution to people and the planet in addition to generating profits. Today there are more than 600 B Corps in 60 industries and 15 countries who hold themselves to a higher standard for purpose, accountability and transparency and who believe that it is possible to simultaneously create social and shareholder value.
Next, Terry Kellog spoke about his organization, 1% For The Planet. Started 10 years ago by the founder of Patagonia, (manufacturers of outdoor gear), 1% For The Planet sees itself as a movement that exists to build and support an alliance of businesses financially committed to creating a healthy planet. As of December 2012, it boasts 1,248 corporate members in 45 countries, growing at a rate of 300 new members a year. Each corporate member commits to donating 1% of their annual sales revenues to support a network of 3,177 non-profit environmental partner organizations. In 2011, donations topped $100M!
The last presenter was Esther Speck who is the Director of Sustainability at Mountain Equipment Coop (MEC). MEC sells $300M of outdoor gear annually to its 3.6M members and is committed to doing that in a socially responsible way. Among many initiatives, MEC has placed an internal cost on carbon of $15/ton and is on track to reduce its carbon emissions to 20% below 2007 levels by the end of this year. It also belongs to the Sustainable Apparel Coalition, an industry-wide group of over 60 leading apparel and footwear brands, retailers, suppliers, non-profits, and NGOs working to reduce the environmental and social impacts of apparel and footwear products around the world. Over 50% of the products that MEC carries are BlueSign™ certified which guarantees those products, along their entire production chain, only contain components and pass through processes that are harmless to people and the environment!
After the presentations, the large audience broke into discussion groups where we contributed to a paper that TSSS plans to publish early in 2013 on the vision and implementation of a more sustainable business model, Capitalism 2.0. There will be more to follow as this story continues to unfold!