Why we need to change the way we do business

Scary

I have read a few scary books in my time. “Bandwashed”, “Future Crimes”, “Climate change” to name a few. “The Ecology of Commerce: A Declaration of Sustainability” fits right in there. What is scary about this book is the picture it paints on how we are making a complete mess of our world.

We are running out of time

A hundred years ago, even fifty years ago, it did not seem urgent that we understand the relationship between business and a healthy environment, because natural resources seemed unlimited. We have decimated 97 per cent of the ancient forests in North America; every day U.S. farmers and ranchers draw out 20 billion more gallons of water from the ground than are replaced by rainfall.

The Ogallala Aquifer, an underwater river beneath the Great Plains larger than any body of fresh water on earth, will dry up within twenty to thirty years at present rates of extraction.

Globally we lose 25 billion tons of fertile topsoil every year, the equivalent of all the wheat fields in Australia. These critical losses are occurring while the world population is increasing at the rate of 70 million people per year.

Quite simply, our business practices are destroying life on earth.

Our earth does not grow

Perhaps if our planet—its land and sky and oceans—were growing at the rate of 2 per cent a year, we could posit sustainable economic growth of a similar rate. However, the earth does not grow. The input of the sun likewise remains constant, and much of the wealth derived from that input, stored over tens of millions of years in the form of fossil fuels, has already been consumed in less than two centuries.

Our cells

It begins with cellular biology because it is the basis for all. The cell is only concerned with the conditions necessary for sustaining and propagating life. It also reminds us that we are inescapably a part of nature: There is much less difference between the cell of a human and that of a plant than is commonly understood.

Frogs

For example, at the moment frogs are disappearing from the face of the earth at an inexplicably rapid rate. Even more disturbing was the conclusion that these populations are crashing not merely in regions where there are known industrial toxins but also in pristine wilderness areas where there is abundant food and no known source of pollution. The implications of such a die-off go beyond frogs.

Our endocrine system

The human endocrine system is remarkably similar to that of fish, birds, and wildlife. It is, from an evolutionary point of view, an ancient system. If endocrine and immune systems are failing and breaking down at lower levels of the animal kingdom, we may be similarly vulnerable. The reason we may not yet be experiencing the same types of breakdown seen in other species is because we gestate and breed comparatively slowly.

We are part of a biological system

On biological levels such as ours, bad news may travel less hurriedly, but it eventually arrives. In other words, something unusual and inauspicious may be occurring globally at all levels of biological development: a fundamental decline that we are only beginning to comprehend and that our efforts at environmentalism have failed to address.

Business people

Today, businesspeople readily concede the abuses of the early days of industry, but they have not yet wholly and genuinely acknowledged the threatening abuses perpetuated by current practices. They cannot explain—much less justify—the accelerating extinction of species, the deterioration of human health, the stress and anguish of the modern worker, the loss of our air, water, and forests.

Blow out sale

Planet Earth is having a once-in-a-billion-years carbon blowout sale, all fossil fuels priced to move, no reasonable offer refused. When this era’s hydrocarbons are sold, they’re gone, never to be seen again. But of course, they will not be quite gone. Much of the coal, oil, and natural gas mined and pumped from the earth will have been placed into the atmosphere in the form of CO2.

Crisis

We face a crisis of unknown magnitude and timing, a sudden altering of oceans, rainfall, temperatures, and diversity that threatens to overturn all of civilisation in a relative twinkling of the historical eye. The degradation of our habitat could include the drying up of traditional breadbaskets, rapid desertification, empty reservoirs, collapsing coastlines, hurricane winds of over 200 miles per hour, increased pestilence, famine, and droughts.

Venus

At present rates of carbon emission, we will change the earth from a single-glazed planet to a “biological meltdown,” a die-off of extraordinary magnitude. We know that if we burn most of our remaining coal, oil, and gas reserves, we will increase carbon dioxide not by a factor of 2 but by a factor of 10, and scientists do have a description for this: Venus.

The world is being destroyed

• The immune system of every unborn child in the world may be adversely and irrevocably affected by the persistent toxins in our food, air, and water.
• Every day the worldwide economy burns an amount of energy the planet required 13,000 days to create.
• Thirty-seven years’ worth of stored solar energy is burned and released by utilities, cars, houses, factories, and farms every twenty-four hours.
• Every living system in the world today is in decline. Between 1975 and 2005, the world’s forests were reduced by 608 million acres.
• Estimates of annual loss of productive cropland are between 12 million and 17 million acres.
• Worldwide crop losses due to pollution are already estimated at between 5 and 10 per cent and continue to rise.
• In the time it takes to read this page, 100 people will have succumbed to pesticide poisoning or become gravely ill: 48 per minute, 25 million every year.
• We are losing 27,000 species a year, 74 per day, one every twenty minutes. Today, we are experiencing the first mass extinction in the 3.8-billion-year history of life-forms caused by another organism—Homo sapiens.
• Every American consumes about 36 pounds of resources a week, while 2,000 pounds of waste are discarded to support that consumption.
• In 2007, according to the EPA’s Toxic Release Inventory, industry disposed of or released 4.1 billion pounds of toxins and hazardous substances into the environment.
• Our oceans are beginning to show signs of rapid deterioration, with a rash of die-offs, epidemics, and new diseases in marine mammal and turtle populations. Baseball-sized tumours are found in turtles in the Gulf of Mexico and Indonesia. In the Gulf of St. Lawrence, a dead beluga whale is classified as hazardous waste and has to be handled with gloves and protective clothing because of the amount of toxins its body contains.
• State-of-the-art incinerator consuming 2,250 tons of household garbage daily would annually emit 5 tons of lead, 17 tons of mercury, 580 pounds of cadmium, 2,248 tons of nitrous oxide, 853 tons of sulfur dioxide, 777 tons of hydrogen chloride, 87 tons of sulfuric acid, 18 tons of fluorides, and 98 tons of particulate matter small enough to lodge permanently in the lungs.
• The lining from paper and wood combines with chlorine gases form 210 different dioxin compounds. For every 100 tons of trash, incinerators produce 30 tons of fly ash, a granular substance that contains most of the toxins.
• A computer exercise calculating the number of potential synergistic and biologic interchanges involved with 6.8 billion people, millions of other species, and the more than 100,000 chemicals and toxins introduced into our environment tells us that it will take an astronomical amount of research to assess the exposures and problems we may have unleashed to date.
• Silk blouses and ties are impregnated with zinc and tin to give them their “hand,” the heavy draping that gives people the impression they are getting a more valuable fabric.
• Shoe leather is tanned with chromium and contains toxic dyestuffs.
• 200 tons of lead are used in hair dryers every year
• At the present rate of extinction we may lose 20 per cent of all the species on the planet within the next twenty to forty years, most of these in the tropical rain forests.
• Corporations leave 11.4 billion tons of hazardous waste behind every year.

Farms

Farms are our most direct link to life. That chemical farming is efficient is to ignore the topsoil that is turning to hardpan, the ground levels collapsing above mined-out aquifers, the white salts glistening on the surface of the land. An efficient farm is one that most effectively internalises all of its costs. That is a farm that builds topsoil, sequesters carbon, uses water sparingly and thriftily, deploys pesticides rarely if at all, and understands that the secret to healthy plants is healthy soil, not deadly chemicals.

We are destroying our biological library

Ecologists are worried about irreversibilities. When species are lost, no change in price or technology will bring them back. A species contains a vast amount of information about the world, its evolution, and how it continues to develop, but most of the information is still undecipherable because biology has not cracked all the codes. The demise of a species is the loss of a biological library.

Good news

The good news is that sustainability is one of the surest paths to innovation for companies seeking a competitive edge. Green capitalism as the way to solve the climate problem. With a redefinition of “profit”. The ultimate purpose of business is not, or should not be, merely to make money. Nor is it merely a system of making and selling things. The promise of a proper business is to increase the well-being of humankind through service, creative invention, and ethical action.

Different business assumptions

If businesses are prepared to reexamine its underlying assumptions and listen to ecologists, botanists, toxicologists, zoologists, wildlife management experts, endocrinologists, indigenous cultures, and victims of industrial processes. Without the selective filter of its internal biases, it will not only fulfil its own agenda of contributing to society by providing products, jobs, and prosperity but also initiate a new era of ecological commerce, more promising and fulfilling than the industrial age that preceded it.

Calculate the full cost

Today, businesses are being asked by environmentalists to internalise costs that were formerly externalised and largely invisible. Businesspeople must either dedicate themselves to transforming commerce to a restorative undertaking or march society to the undertaker. The single greatest flaw of modern accounting is that the cost and losses of destroying the earth are absent from the prices in the marketplace. For example, for the chemical industry to incinerate the waste from the top fifty products it produced in 1986, it would have to pay the going rate of approximately $100 per ton, a total cost to the industry of $20 billion, eight times the profits made by the companies in that year. In other words, the chemical industry would be unprofitable if it had to clean up its wastes on a yearly basis.

You cannot bail out a planet

You can print money to bail out a bank, but you can’t print life to bail out a planet. At present we are stealing the future, selling it in the present, and calling it gross domestic product. We watch economic indexes climb, as measured in gross national product, but we have not yet formulated an accepted index of what that progress is costing on the environmental side.

We are left with the bill

We have received a nearly unpayable bill from the industrial world for its past and ongoing excesses. In economic terms, we will eventually slide backwards, because any incremental growth in GNP will be spent to protect us from the dangers of that growth.

Logic

The logical response to our current predicament would be to design or redesign manufacturing systems so that they do not create hazardous and biologically useless waste in the first place. How can we create a society and culture that support the transition from an industrial to a restorative society?

Restorative economics

A restorative economy is organised in a profoundly different way: it does not depend upon transformed human nature, but it does require that business be an ethical act that mimics the interwoven, complex, and efficient models of natural systems. In a restorative economy, viability is determined by the ability to integrate with or replicate cyclical systems in its means of production and distribution. The restorative economy would invert many fundamentals of the present system. In such an economy, there is the prospect that restoring the environment and making money would be the same process.

The new rules

For a product to qualify as a consumable product, its waste must be wholly biodegradable, capable of transforming itself into food for another organism, with no toxic residue that would cause harm or be accumulative. Companies must re-envision and reimagine themselves as cyclical corporations whose products either disappear into harmless components or are so specific and targeted to a specific function that there is no spillover effect, no waste, no random molecules dancing in the cells of wildlife. In short, no forms of life must be adversely affected.

Biomimicry

As in nature, business and restoration should be part of a seamless web. Environmental protection should not be carried out at the behest of charity, altruism, or legislative fiats. As long as it is done so, it will remain a decorous subordinate to finance, growth, and technology. Business has three basic issues to face: what it takes, what it makes, and what it wastes, and the three are intimately connected.

Industrial ecology

One of the most comprehensive strategies for sustainable industrial methods is “industrial ecology.” Companies practising industrial ecology try to dovetail their material and waste flows, attempting to eliminate pollution by tailoring manufacturing by-products so that they become the raw materials of subsequent processes.

Intelligent product systems

Under intelligent-product systems, products would not be sold; instead, they would be licensed to the purchaser, with ownership retained by the manufacturer. When you bought a refrigerator, a television, or a car, you would buy the license to use and operate it. However, the product could not be disposed of or thrown away. It would have to be returned by the final user or, in the case of large appliances, picked up by the manufacturer or retailer. At present, most durable products are not recycled; instead, they are down-cycled. They are reduced to scrap. Their parts melted down to yield paper, glass, aluminium, and plastic.

In an intelligent-product system, products or services would be designed for easy disassembly for reuse, remanufacture, or reclaiming. If we imitate natural systems in our economy, we will create more jobs for people. Manufacturers will benefit from customer loyalty since people turning in old products are more likely to develop product loyalty.

Unsaleable products

Finally, there is what we call unsaleable products: toxic chemicals, radiation, PCBs, heavy metals, and the like. An intelligent-product system works toward designing unsaleables out of consumables (for example, eliminating the use of mercury fungicides for seed coatings), and, eventually, from all products of service.

Parking lot concept

Under the parking lot concept, storage charges would be the responsibility of the manufacturer of the toxin, who would pay for the service in perpetuity or until the industry or some other agency devised a safe method of detoxification. The chief advantage of the parking lot is that it ties the manufacturer to the waste. The parking lot concept could be extended through the use of molecular markers. Selected chemicals—those that are persistent, bioaccumulative, and toxic—would be required to be molecularly tagged so that the manufacturer that produced them could identify them. If toxins show up in habitats, it would be the responsibility of the maker to retrieve them. If I was a lawyer, I would get my AI on the case now. Sueing the oil companies will just be the beginning. Will talk about this at the London Law Expo.

Cradle to cradle

A cyclical, restorative economy thinks cradle-to-cradle, with every product or by-product, imagined in its subsequent forms even before it is made. Designers must factor in the future utility of a product, and the avoidance of waste, from its inception.

We have to recognise that we’ve reached a watershed in the economy, a point at which growth and profitability will be increasingly derived from the abatement of environmental degradation, the furthering of ecological restoration, and the mimicking of natural systems of production and consumption.

Exponential

I hope that the exponential technology curve meets the exponential climate change curve before we get to the 2 degrees. The view of the author is that the underlying principles informing the cautionary predictions are correct; the timing of earthly and climatological limits is not. That means that the optimists who say we will be taken care of in the future will be correct for the time being, right up until the day they are wrong, when we will all be in big trouble.

Restoration language

We need to create a restoration economy. Starting with learning how to speak the language. Instead of being taught to identify types of cars, we should learn about the types of birds. Instead of knowing how to identify a thousand corporate logos we should learn how to recognise native plants. We need to go back to nature.

Instead of cost price, we should use restorative pricing. The definition of profit should mean giving back to nature. It starts with your own business. How profitable are you?