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By: Dirk Philipsen

Originally published in AEON Magazine

Against the capitalist creeds of scarcity and self-interest, a plan for humanity’s shared flourishing is finally coming into view

I’ve witnessed massive swarms of fireflies
grace my garden like never before, drawn
to the air cleansed of our arrogant greed,
their glow a flashback to the time before
us, omen of Earth without us, a reminder
we’re never immune to nature. I say this
might be the end we’ve always needed
to begin again …
– From the poem ‘Say This Isn’t the End’ (2020) by Richard Blanco

A basic truth is once again trying to break through the agony of worldwide pandemic and the enduring inhumanity of racist oppression. Healthcare workers risking their lives for others, mutual aid networks empowering neighbourhoods, farmers delivering food to quarantined customers, mothers forming lines to protect youth from police violence: we’re in this life together. We – young and old, citizen and immigrant – do best when we collaborate. Indeed, our only way to survive is to have each other’s back while safeguarding the resilience and diversity of this planet we call home.

As an insight, it’s not new, or surprising. Anthropologists have long told us that, as a species neither particularly strong nor fast, humans survived because of our unique ability to create and cooperate. ‘All our thriving is mutual’ is how the Indigenous scholar Edgar Villanueva captured the age-old wisdom in his book Decolonizing Wealth (2018). What is new is the extent to which so many civic and corporate leaders – sometimes entire cultures – have lost sight of our most precious collective quality.

This loss is rooted, in large part, in the tragedy of the private – this notion that moved, in short order, from curious idea to ideology to global economic system. It claimed selfishness, greed and private property as the real seeds of progress. Indeed, the mistaken concept many readers have likely heard under the name ‘the tragedy of the commons’ has its origins in the sophomoric assumption that private interest is the naturally predominant guide for human action. The real tragedy, however, lies not in the commons, but in the private. It is the private that produces violence, destruction and exclusion. Standing on its head thousands of years of cultural wisdom, the idea of the private variously separates, exploits and exhausts those living under its cold operating logic.


In preindustrial societies, cooperation represented naked necessity for survival. Yet the realisation that a healthy whole is larger than its parts never stopped informing cultures. It embodies the pillars of Christianity as much as the Islamic Golden Age, the Enlightenment or the New Deal. In the midst of a global depression, the US president Franklin D Roosevelt evoked an ‘industrial covenant’ – a commitment to living wages and a right to work for all. During the 1960s, Martin Luther King, Jr gave voice to the broader idea when he said that no one is free until we are all free. On Earth Day 1970, the US senator Edmund Muskie proclaimed that the only society to survive is one that ‘will not tolerate slums for some and decent houses for others, … clean air for some and filth for others’. We should call these ideas what they are – central civilisational insights. Social and economic prosperity depends on the wellbeing of all, not just the few.

Cultures that fundamentally departed from this awareness usually did not, in the long run, fare well, from the Roman Empire to Nazism or Stalinism. Will neoliberal capitalism be next? Rather than acknowledge the endless variety of things that had to be in place to make our individual accomplishments possible, it is grounded in the immature claim that our privileges are ‘earned’, made possible primarily by private initiative.

But what a claim it is: where would we be without the work and care of others? Without the food from the farmer? Without the electricity and housing and roads and healthcare and education and access to information and hundreds of other things provided to us, day in and day out, often for free, and routinely without us knowing what went into their existence? Seeing ourselves as seemingly free-floating individuals, it’s both easy and convenient to indulge in the delusion that ‘I built it. I worked for it. I earned it.’

The painful flipside are the billions of those who, through no fault of their own, drew the short end of the stick. Those who were born in the wrong country, to the wrong parents, in the wrong school district – ‘wrong’ for no other reason than that their skin colour or religion or talents didn’t happen to be favoured. The limited focus on the individual can here be seen as nakedly serving power: if those who have privilege and wealth presumably earned it, so must those who have pain and hardship deserve it.

Old and young, meanwhile, sense the loss of a cultural heritage that transcends the private, a purpose beyond the marketing of self. We likely fear, with good reason, that, in all the self-promotion, we can no longer rely on others to be there for us, to provide us with consistent work, a stable community, a bit of love and kindness. We are scared of climate change, the ultimate consequence of our voracious consumption. We dread loneliness and depression, too much work, the loss of jobs, debt. We sense, and often experience, that everyone looking out for themselves brings out the worst in us – me against you, one tribe against the other. Many experience it simply as a culture in distress.

Standard economic thinking both seeds and feeds the underlying fear by instructing that we’re all in a race to compete for limited resources. Most definitions of mainstream economics are based on some version of Lionel Robbin’s 1932 definition as the ‘efficient allocation of scarce resources’. The answer to scarcity coupled with people’s presumed desire for more is, of course: keep producing stuff. Not surprisingly, the guiding star for success, of both policymakers and economists around the world, is a crude, if convenient metric – GDP – that does nothing but indiscriminately count final output (more stuff), independent of whether it’s good or bad, whether it creates wellbeing or harm, and notwithstanding that its ongoing growth is unsustainable.

It’s circular logic: (1) scarcity makes people have endless needs, so the economy needs to grow; (2) for the economy to grow, people need to have ever more needs. Such thinking dominates the field of economics, and much of contemporary culture: Man (yes, those ideas overwhelmingly come from men) as the endless optimiser of self-interest; people reduced to producers and consumers; all aspects of life that go beyond the mere accumulation of stuff – morality, joy, care – confined to kindergarten, fiction and the occasional ethics course in high school or college. The result is what Nicholas Kristof in The New York Times calls a ‘moral myopia’ threatening to collapse under a mounting pile of stuff.

Dysfunctions such as climate change, racism and inequality are not unrelated and naturally occurring features of life. On the contrary, they are based on the fictions and failures of the ‘private’ that later turned into systems that now govern our lives.

In reality, we collaborate, organise together, show love and solidarity – as the Nobel laureate Elinor Ostrom documented in her book Governing the Commons (1990) – in the process invariably creating common rules and values that organise communal life. We rely on society, community, family, day-in and day-out. And yet the tragic disconnect between our lived reality (however embattled at times) and the dominant ideology, celebrating ‘the private’ in textbooks, newspapers and Hollywood movies, often eludes us. When large corporations, run by people who preach the gospel of the market and private gain, need the public to bail them out, few in power raise the most obvious question: why do you need public money to bail you out if you are supposed to be pulling yourself up by your bootstraps?

A deeper question might be: why should wealth and privilege – largely built on the free work of nature and the cheap work of labourers – be rescued, when in trouble, by the very people otherwise deemed ‘disposable’?

The particular version of the ‘private as property’ likely has its origins in the Roman empire. It comes with the notion of absolute dominion – denoting one’s right to have full control over one’s property. Initially, such dominion was exercised by the male head of household, over both things and people – or, more precisely, over things, but also over people who, in what was possibly the first legal power grab in the name of the private, came to be defined as things (children, slaves).

When George Floyd was killed on 25 May 2020, it put on global display, once again, that most people – poor, younger, older, Black, Brown, non-male – remain disposable in the regime of private interest. All too often, they are violated in the scarcely disguised name of private property, perpetrated by those tasked to defend it, the police. The mistake of vandals in recent demonstrations, as satirists have pointed out, was that they didn’t loot in the name of private equity firms. Put differently: in order for the law not to put its boot on your neck, your theft has to come at white-collar scale and the sanction of power.

The tragedy of the private, in short, doesn’t come from the private as individual, but from the private as ownership, as control over land, resources and others. To own was always less about protection of the self than it was about exclusion of others. As such, it is a logical violation of the ‘other self’ or, really, other selves. You against me – your gain as my loss.

To illustrate: no single event, short of war, created as much misery in a country like England as when those with access to violence (arms, laws, wealth) privatised and fenced in the land that people needed to stay alive. It came to be known as ‘enclosure of the commons’ but represented a largescale and bloody theft, allowing a tiny percentage of people to exclude the majority from access to a common heritage. The result has since been naturalised and replicated the world over and sanctified in law as ‘the rights of private property’.

No bodies were ever more violated than those brutalised as slaves or serfs, all in the name of profit and – as authors such as Kidada Williams have documented in painstaking detail – sanctified by a vicious regime of private property. Racism, as thinkers from C L R James to Angela Davis to Barbara and Karen Fields remind us, is an essential building block to the system of private capital.

No form of governance, social or economic, has plundered the resources provided by nature as much as private property (though the state ownership of communism came close).

No single circumstance undermines political rights and freedoms today more than poverty – the violent exclusion from essential human rights: access to work, income, vital resources.

The private as dominion over property thus inevitably violates the private as personal integrity and freedom. Humans become objects – my slave, my worker, my child – and are denied access to the essentials of life. Thus deprived of independence, the private reduces the freedom of the majority, all those without access to sufficient capital, to the narrow choices provided by the marketplace in service of private property – they are, in Amartya Sen’s words, effectively denied ‘the capability to realise one’s full potential as a human being’.

Over generations, open theft of common heritage became disguised as private property, hiding behind legal contracts and the cold fiction of money as wealth. One gets used to customs, this history suggests, even when they defy rational thought. The original freedom fighters against the enclosure of common land, groups such as ‘the Diggers’, were remarkably less mystified than their modern compatriots: no one is free, they declared in 1649, ‘till the Poor … have a free allowance to dig and labour the Commons’. Thomas Jefferson (the freedom fighter, not the slaveholder) would’ve understood the logic – as would’ve Toussaint L’Ouverture or Nelson Mandela.

Legally ‘set free’ to sell their labour power, the landless were instead reduced to a state of abject poverty where they became the unwilling ‘masses’ populating the satanic mills of early industrialisation – freedom as a choice between misery or death.

The excuse for the ruthlessness of the exclusion and exploitation of others in the name of private interest was always the same: the prospect of a better future for all. Today, we should ask: has it succeeded? It is a question far more difficult to answer than modern apologists such as Steven Pinker would have us believe. Yes, by any available measure, capitalism (based on private interest) has generated unprecedented wealth and knowledge.

This explosive creation of wealth, however, came, and continues to come, with a steep, and exponentially rising, price. Powered by fossil fuels, it is both depleting and burning up the planet. Grounded in extraction and exploitation, capitalist progress carries mounting violence and destruction in its wake. The flipside of civilisation, in Walter Benjamin’s words, appears to be ‘a document of barbarism’. Growth, expansion, development – the struggle to conquer scarcity both gave and took in large measure from those who populated our land. Perhaps it’s finally time to recognise the carnage that created the wealth.

At first, modern economies succeeded in providing more calories to a starving patient. Based on this initial success, the economics profession (no doubt based on sophisticated mathematical models) concluded that more calories will forever improve health. Now dealing with a lethally obese patient, our leaders and economic advisors stubbornly resist acknowledging the obvious question: if we continue on an exponentially increasing regimen of calories, won’t we incapacitate, if not kill, the patient – ourselves?

Much has been said about how the incessant race for more, bigger, faster has also led to a crisis of meaning and purpose, what King, Jr called a widening ‘spiritual death’ of living in a ‘thing-oriented’ rather than ‘a person-oriented society’, or what D H Lawrence simply labelled ‘the Mammon of mechanised greed’.

But whether the death is one of spirit or meaning, or the actual death of nature and people, all spring from a common root: the single story of self-interest, and its logical manifestation, the private. ‘We do not have to escape from the Earth,’ as the environmental activist Vandana Shiva exhorts us in Oneness vs the 1% (2019), ‘we have to escape from the illusions that enslave our minds …’

We live in a different world now. Whatever might have been justified in the past to overcome poverty and scarcity no longer holds sway. Today, we face an entirely different challenge. Not too little, but too much. Not scarcity, but abundance.

In the modern world, more is actually less. Indeed, the costs of economic growth have begun to outpace their benefits, visible in the plunder of the environment and escalating inequality. We no longer need more, but rather better and more fairly distributed, in order to provide prosperity for all. Collectively, we produce and grow enough for every child, woman and man to have a good and dignified life wherever they live. As a world community, we know more and create more than we know how to process. It’s a huge accomplishment. We should celebrate and enjoy it together, rather than remain on the deplorable path of pitting one against the other in the race for ever more, one dying of too much, the other of too little.

And yet, our dominant economic systems continue to follow colonial extraction and brutal exclusion, in the process creating two organically related, existential problems: the perpetuation (and in some cases intensification) of poverty, and the violation of the biophysical limits of our planet. What a tragic irony that, in the early 21st century, higher education’s economics departments worldwide still instruct some of our brightest minds in simplistic economic models about the efficient allocation of scarce resources, rather than in how to sustainably build the good life based on an abundance of knowledge and resources.

To emphasise: chasing the bogeyman of scarcity, we are, by now, in the process of passing some frightening historic thresholds, altering the very makeup of life and creating an unsustainable future for our children and grandchildren. It’s Barbarism 3.0.

I wonder if the real tragedy of the private lies in separating what can function only when together, in the process excluding, individualising, destroying, alienating and, in consequence, undermining the innate creativity and resilience of a necessarily complex system of interaction – between human and human, and between human and nature.

We’re living in the midst of a historic transition. It might be our great fortune that, at this juncture, we still have a choice: to wake up, or continue to muddle along on our current path. If we choose the latter, as most mainstream experts from around the world keep telling us, ‘collapse is very difficult to avoid’.

Certainly, the history of how we got here, and the options of changing course, are immensely complex. Yet the reason why collapse is virtually assured if we continue on our current path is actually quite simple: too much.

The Achilles heel of modern economies is the exponential nature of economic growth. Based on what economists consider a ‘healthy’ growth rate of about 3 per cent, the economy would have to double in output roughly every 23 years. If such growth is difficult to imagine, that’s because it is absurd. Imagine economies such as the United States with 16 times the output in 100 years, 256 times in just 200 years, or 5,000 times in as little as 300 years. There is one diagram in economic theory, writes Kate Raworth in Doughnut Economics (2018), that ‘is so dangerous that it is never actually drawn: the long-term path of GDP growth’.

Instead, we should ask, what do we really value? And how do we measure it? When authors write about economies for the common good, or for the wellbeing of all, they highlight a very different set of values than those, based on private property and private gain, that dominate modern economies today – not efficiency but health and resilience; not the bottom line but collective wellbeing. They are founded on the basic moral claim that, as the legal scholar Jedediah Purdy puts it in This Land Is Our Land (2019), ‘the world belongs in principle to all who are born into it’.

Most civilisational traditions agree that everyone brought into this world should have an equal claim to thrive. If we follow those traditions, we must conclude that cultures ‘already parcelled out’ into private property and wealth are morally bankrupt. They value the private over people.

In The Value of Everything (2019), the economist Mariana Mazzucato points to an underlying flaw in thinking: ‘until now, we have confused price with value’. Economists and policymakers have created a system disconnected from the real world that privileges market transactions over our personal and planetary wellbeing. This, too, is standard circular logic: earnings are justified because something was produced that presumably has value; value, in turn, is defined by the amount of earnings.

Here perhaps is the crux of our technocratic era: we value what we measure. When we measure the wrong things, the result is perverse. Today, what matters most to a thriving life is not counted at all in our dominant economic performance indicators. A natural environment that will continue to provide us with fresh air, clean water, rich soil – not counted. Communities that educate and nurture their members – not counted. Forms of governance with a stable degree of accountability – not counted. In the end: our ability to continue life on Earth (what is meant by the word sustainability) – not counted. We have an economic system, reflects Lorenzo Fioramonti in Wellbeing Economy (2017), ‘that sees no value in any human or natural resource unless it is exploited.’ The result is what the medical historian Julie Livingstone calls ‘self-devouring growth’. The triple challenges of climate change, pandemic and systemic racism highlight the deeper systemic defects.

Perhaps it is, then, unrealistic to expect individuals to make smarter choices, when dominant economic reasoning rewards them for moving in the wrong direction. I see this every spring when talented undergraduates face limited choices for their future: corporate law, consulting, finance, highly specialised medicine. Can we build forward on fleecing investors, addicting consumers to ever more products or making a career lying to the public, yet make it virtually impossible for those seeking a sustainable future and balanced life to pay their bills?

The urgency of now might instead require a change in the operating logic, a system that supports the core values that make up all thriving life – health, diversity and resilience. One might call it ‘shared prosperity within biophysical boundaries’ or, as Raworth has it, ‘doughnut economics’.

Whatever we call it, we need an economy focused on shared flourishing, rather than on the chimera that more money will somehow, someday magically get us there. It’s a simple and hard-nosed recognition of reality.

Beyond what is possible, we should ask what we actually want. Perhaps the deepest tragedy of the private is not even the destruction of our home in the name of self-interest, but missing out on history’s greatest opportunity, failing to realise what thinkers of the past could only dream about – a life liberated from want and scarcity. A culture where ‘the love of money as a possession’, in the words of John Maynard Keynes in 1930, ‘will be recognised for what it is, a somewhat disgusting morbidity.’ A future, as Vandana Shiva aptly summarised it, in which the economy’s ‘currency is not money, [but] life’.

It is a sorrow of the narrow that modern cultures, for the most part, no longer give themselves permission to dream and strive for a better life. Rather than idolise some past greatness or false realism that never was, why not imagine a grown and healthy adult who is no longer prisoner to the regimen of ‘ever more calories’ – a mind liberated from ‘the love of money’ that the sustainability economist Tim Jackson envisioned in Prosperity Without Growth (2009). Yet it could be even more. Prosperity without mental and cultural imprisonment, without the drudgery of wage labour, and the dismal reduction of life to cost-benefit analyses – a life, in the words of the poet Langston Hughes, ‘where greed no longer saps the soul’.

It could be a life as imagined by theorists such as adrienne maree brown in Emergent Strategy (2017) and the young activists of the International Indigenous Youth Council, the Movement for Black LivesFridays for Future, the Sunrise Movement or the Wellbeing Economy Alliance. People in such groups are imagining life within stable and healthy communities, respectful of difference. They envision regenerative and carbon-free economies, communities that offer meaningful work to everyone who wants it. They have drafted sophisticated policy proposals (see links above), and authored detailed accounts of a possible wellbeing economy. They are fighting for what the legal scholar Amna A Akbar in The New York Times called a governance system ‘whose primary allegiance is to people’s needs instead of profit’. In short, by finding our personal and collective sovereignty, we could, in solidarity with each other, build a thriving society for the common good, not just for the select few.

Given our current global situation, the temptation is to dismiss all such thinking as idealistic and naive. And yet, if you pay close attention, signs of life are cracking through the edifice of the old everywhere. As the social theorist Patricia Hill Collins reminds us, ‘there is always choice, and power to act, no matter how bleak the situation may be.’

German millennials have called out their elders with the missive Ihr habt keinen Plan (2019), or ‘You Don’t Have a Plan’, and then set out to construct a vision that holds promise for future generations. The public intellectual Rutger Bregman asks us to finally stop defending the indefensible. His book Utopia for Realists (2017) is grounded in a profound realisation: many utopias are more realistic than current reality, no matter how much the latter is defended as the only option by those with suits, impressive university degrees and big bank accounts.

We need to have a broad democratic dialogue on the mix of policies that might work best in promoting the common good, in overcoming the tragedy of the private. A new freedom will have to nestle within the realities of nature and the rights of others. Limits will be rediscovered as essential to freedom. This will require difficult transitions – away from fossil fuel or the mass-produced consumption of meat or the acceptance of rampant inequality. Yes, a sustainable wellbeing future will make obsolete many skills and professions, likely eliminating more jobs than it replaces, opening up opportunities for shorter working weeks for everyone. Among the many possible paths forward, the following core features will be essential:

  • local, national and international regulations preventing the violation of critical ecological thresholds;
  • repair of the most egregious market failures through true-cost accounting, properly valuing essential work(ers), ending the privatisation of gains and socialisation of costs, and compensating for essential ecosystem services and the care economy (a full-cost accounting of gasoline, for instance, could raise the price to $16 a gallon);
  • making available basic services and basic income to everyone (we could call it a ‘self-evident truth that all Earthlings have an unalienable right to the preconditions of life, liberty and happiness’);
  • access to work for all, for everyone deserves the opportunity to make a meaningful contribution;
  • a basic moral recognition that nothing – not race, not nation, not gender, not personal contributions, not your zip code – should ever be legitimate cause for either extreme poverty or excessive wealth;
  • and, most fundamentally, a basic acknowledgement that we don’t own or control this planet, but simply borrow it ‘from the seventh generation’ – those coming after us. The principle should always be, as many learned in kindergarten: ‘Leave it as good as, or better than, you found it.’

Yes, it is time to rewrite the script. A climate in deep crisis, a global pandemic, systemic racism and inequality are all part and parcel of the same bad script, the tragedy of the private, aggravated by an elite inability (or unwillingness?) to contemplate a better future.

Even though narrow selfishness, when elevated into ideologies in service of the private, has repeatedly brought the world to the brink of disaster, we have thus far survived largely because of our underlying ability to cooperate. It is now time to make our exceptional human capacity to create and cooperate part of our governance structures – part of the operating logic of modern societies. Perhaps then we can bring to life what others could only envision: a system focused on wellbeing of people and planet, liberating our individual and collective capabilities.

Learn more about Dirk Philipsen here

Authors: Olga Koretskaya, Gus Grosenbaugh

Read Paper

For the past several decades, the primary question for many businesses has been: “How much money can we make?”. It is still largely assumed that the social responsibility of business is to increase profits for shareholders, as that wealth should trickle down to benefit all. While the formal economy has never been larger, the unprecedented scale of environmental degradation and inequality it has created today makes us question business-as-usual and to look for alternatives.

In fact, all around the world, people are rejecting the status-quo of self-interest. In the midst of the global pandemic, more than ever, we see purposeful work towards building an economy that delivers environmental and social wellbeing.

  • With the election of Joe Biden, the US appears primed to re-enter the Paris Agreement.
  • New Zealand’s Wellbeing Budget makes health a key, driving metric in economic decision making.
  • The ‘rights of nature’ are being recognised by national and local laws, predominantly in the countries of the Global South: Ecuador, Bangladesh, Bolivia, Mexico, Uganda, and Colombia.

While public awareness and government policies are crucial in supporting Wellbeing Business, it is companies – both large and small – that will be the engine behind the transition. The good news is: many of them already exist, and we know how to recognise them.

Here are eight key principles that define a Wellbeing Business.

  1. Redefining the vision. Primarily driven by the desire to create products and services that satisfy the needs of society, while staying in harmony with nature. 
  2. Ensuring transparency. Proactive in disclosing data about their environmental, social, and economic performance.
  3. Internalising externalities. Aware of the ‘negative externalities’ or negative environmental and social impacts they produce, and strive to reduce them.
  4. Having a long-term mindset. Make decisions that benefit the company and all important stakeholders including society and nature. This implies, for example careful consideration of resource use, and investment in employees and the communities within which companies operate.
  5. Making people an asset. Prioritise the dignifying of work and empowering of diverse voices within the company.
  6. Localising production. Become much more embedded in the community and ecosystems by striving to localise energy sources, financial sources, as well as distribution.      
  7. Switching to circular production. Design business processes to coexist with environmental and social systems.
  8. Embracing diversity. Acknowledge and embrace diversity in values, ownership structure, finance as key to a resilient business environment.

On 18 December we hosted a webinar to discuss this paper. You can watch the recording here:

Also, do check out the WEAll Business Guide as a nice pair to this work.

Last January, we launched ‘The Business of Wellbeing: a Guide to the Alternatives to Business as Usual’. It aimed to answer questions such as, “What exactly is a wellbeing economy and how can we put it into practice?”and, “What are the options and what is the path that makes sense in each particular business context?”  

Examples of Wellbeing Economy businesses outlined in this guide include:

Riversimple

A car manufacturer founded to ‘pursue, systematically, the elimination of the environmental impact of personal transport’. Its business model aims to completely rethink the automobile sector, from open-source design to a circular economy approach to car use. The founders redefine ownership by including key decision-makers in their governance structure, not only investors but also the Environment, Customers, Communities, Staff, Investors and Commercial Partners. The Board’s duty is to balance and protect the benefit streams of all six stakeholder groups, rather than maximising the value of one.

Futuro Forestal

Futuro Forestal has become one of Latin America’s largest and premier providers of tropical hardwood, and worked on the reforestation of over 9000 hectares, the creation of 4,500 hectares of private reserves. Together with a number of local and international stakeholders and investors, Futuro Forestal developed the ‘generation forest’, a combination of the dynamics of natural forests and reforestation which absorbs carbon dioxide and ensuring biodiversity and recovers soils and water sources. It also helps to create income earning opportunities for locals. 

Throughout the year, we have used this guide to drive some of our engagement with our network. For instance, we hosted two events that presented the guide and discussed practical strategies that businesses could use to transition to a ‘Wellbeing Economy Business’. 

Currently, our Organisational Lead, Michael, is working with WEAll Scotland to deliver a training programme for Scottish businesses based on the guide. The first iteration of this training is concluding soon. We imagine this work will continue in other countries and hope to be able to adapt the training for their specific contexts. 

The guide outlines seven dimensions for ‘The Business of Wellbeing’, that Wellbeing Economic businesses embody: 

In addition to the celebration of the Business guide’s one-year anniversary and the work on Wellbeing Economy businesses it has helped move ahead, WEAll is also hosting a panel discussion on December 18th on the topic of the state of Wellbeing Economic businesses in the world today. 

The panelists are: 

Olga Koretskaya and Gus Grosenbaugh, the authors of an upcoming WEAll briefing paper called “Business in the Wellbeing Economy”. We will share the publication before the event.

Bonnie Clark is the CEO of This is Remarkable. She has hundreds of case studies of businesses in Scotland who have undertaken the initiative to become a wellbeing business. 

Michael Weatherhead is Organisational Lead and WEAll and spearheaded the publication of the WEAll Business Guide last year. 

If you’re interested in joining, please register for the event here.

The Repair Stop, a new community repair enterprise, is opening in Glasgow on 21 July. Sophie Unwin, founder and director of the Remade Network, shares her thoughts on how community repair enterprises such as The Repair Stop can provide a model on building a greener, fairer world.

As the Remade Network launches its new, collaborative community repair project in Glasgow, Katherine Trebeck’s words resonate with me:

“The economic model that has become so dominant is called all sorts of things: neoliberal, market fundamentalist, overly financialised, extractive, and toxic. What it is called doesn’t matter so much as how it has strangled our imaginations and our sense of possibility.”

We know the scale of the challenge that we face in our world is huge. Oppression, inequality, waste, and pollution are in every corner. Headed in one direction, it looks like an inevitable move to a certain dystopia – where we blindly consume and compete instead of sharing resources and showing empathy to each other.

As bad as things could get, it perhaps allows us to dream big of a better world that we would like to see. But for those of us – like me – who have reached our middle age, our hopes are inevitably tempered with a sense of realism. We have heard new ideas and slogans come and go, from sustainable development to the triple bottom line. And we know that real change can be hard won, as it speaks of shifts to the status quo.

Could a wellbeing economy offer us something new?

“As bad as things could get, it perhaps allows us to dream big of a better world that we would like to see.”

For me, building an economy based on repair skills – the work I’ve carried out over the last 12 years, which has grown from London to Edinburgh and now Glasgow – chimes closely with what the Wellbeing Economy Alliance advocates. This is a regenerative economy, one that prevents waste at its source rather than just recycling materials; a collaborative economy where we work with other community groups and Glasgow City Council; and a business model with purpose and shared values at its heart.

In January this year, we started work in earnest with five other organisations: Govanhill Baths Community Trust, Repair Café Glasgow, Glasgow Tool Library, The Pram Project, and Glasgow City Council. Meeting each fortnight, we developed a collaborative business plan, for which the City Council granted us a social enterprise start-up grant.

Then came COVID-19.

With no social contact allowed, we started meeting online and had to pivot our plans. But we also had space to share ideas, discuss our values, and reflect on what was really important to us. From April, Remade Network has grown from three members of staff to seven, and this July we open our new project – The Repair Stop.

Based at Govanhill Baths’ Deep End on Nithsdale Street in Govanhill, The Repair Stop will offer affordable repairs, priced at £5 or £10, and accept donations of unwanted laptops, phones, tablets, and prams that we will fix, redistribute, and sell on.

And, thanks to contracts with both Glasgow City Council and the Scottish Government, we will be distributing 500 desktop computers to vulnerable people across the city. People like Mohamed from the Somali Association, who will ensure the computers help people find jobs, access basic services, and stay in touch with their families. And people like Elaine, a single mum whose son, Maxwell, has struggled to do his schoolwork since COVID, as they don’t have a working computer at home.

The C-40 Cities Climate Leadership Group have recently published some principles about a green recovery, and some of these speak to the project:

  • Excellent public services, public investment, and increased community resilience will form the most effective basis for the recovery
  • The recovery must address issues of equity that have been laid bare by the impact of the crisis
  • The recovery must improve the resilience of our cities and communities

Equity and resilience are so vital here. It is the people who consume the least who are most impacted by pollution and environmental problems. But it is also those people, and poorer communities, who often hold a wealth of creativity and ideas. Poorer communities are already used to being resourceful and resilient.

As the Aboriginal leader Lilla Watson says, “If you have come here to help me, you are wasting your time, but if you have come because your liberation is bound up with mine, then let us work together.”

Moving away from extractive to regenerative economies also means valuing indigenous knowledge, the skills and ideas that are already in place when we come to start work on a new project. Without this basic attitude of respect and curiosity, how can we achieve anything meaningful?

We firmly believe that repair can help us build a better world post-COVID and help regenerate forgotten places. It values and draws on people’s skills and creativity, as each repair is different, and it creates new jobs – repairing creates 10 times as many jobs as recycling. Finally, it brings people together and helps build community. Repair is not a new idea, but it is one whose time has come.

As the Wellbeing Economy Alliance reminds us, “Humanity defines economics, not the other way around.” In many ways, this could be a motto for social enterprise as a whole – business and profit is not the end in itself, but a means to harness our core values and create a better world.

You can visit the Repair Stop at 21 Nithsdale Street in Glasgow, open 12-2pm Monday to Saturday, from 21 July, for repairs of household items and to donate unwanted and broken laptops, phones, tablets and prams. For more information, email repair@remade.network, visit www.remade.network, or follow @remadenetwork on Twitter and Facebook.

(Photography credit: Hollin Jones)

The impacts of COVID19 on the economy show that the way we do business today is economically unsustainable. Business owners and decision makers are in crucial need of alternatives to business-as-usual in order to create resilience for crises to come and to become part of the solution rather than the problem.

WEAll, Sistema BWorld Fair Trade Organisation and SenseTribe therefore invite business owners, decision makers and other stakeholders to commit to seeking out ways to contribute to an economy that is not only economically viable but also socially and environmentally resilient:

  • Business resilience: We commit to give as much importance to resilience as to efficiency in our business model and value proposition. We commit to building resilient business structures, allowing us to respond to a changing environment and to build capacity to deal with crises effectively.
  • Human wellbeing: We commit to building balanced stakeholder relationships, so there is trust and commitment to one another. An important basis for building capacity for effective collaboration in moments of crisis.
  • Environmental wellbeing: We commit to re-evaluating how our business can make a positive contribution to our current  environmental crisis, making our business part of the environmental solution, not the problem.

Download the full Pledge

 

Sign the Pledge Now

Business owners and decision makers can also find out more and get involved in the Build Business Back Better community through events on 26 May and 25 June. The sessions will delve into the rich resources available in the Business of Wellbeing Guide and will highlight which options can help you navigate the alternatives and will give you inspiration on how to build businesses back better.

Join us on 26 May (6.30pm UK time)

Reposted from the site of Social Enterprise Mark CIC, which is part of WEAll Member Social Value UK

By Sophie Short

Calling on Government to #SaveOurSocents

Social Enterprise Mark CIC is working with partners in the social economy to call on the Government to make some small changes to the way it is currently distributing business support, to ensure the long-term sustainability of the UK’s 100,000 social enterprises, co-operatives and community businesses.

We realise that many social enterprises have been falling through the cracks of Government support and are unable to access the necessary grants and loans to keep their businesses afloat. We are urging the Government to act now to ensure social enterprises are supported to get through this crisis, which we believe will increase the chance of a quick, fair and inclusive recovery from this lockdown.

We have written a letter to the Chancellor to outline a four-point action plan to ensure social enterprises receive appropriate support:

  1. Extending existing business grants to include social enterprises;
  2. Changing the delivery of loan finance to work for social enterprises;
  3. Opening up emergency financing for public services to social enterprises delivering services on behalf of the state;
  4. Providing business support so that social enterprises can use any funds they do receive effectively to transition their business.

Lucy Findlay, Managing Director of Social Enterprise Mark CIC said “Social enterprises are part of the glue that holds our society together. They will now be needed more than ever to help rebuild a more resilient economy moving forwards. To not invest in them now risks huge holes in getting back to normal and will leave the most vulnerable without the support that they so desperately need.

How you can help

We are calling on our network and the wider social enterprise community to back our call to the Government for urgent support. Please complete this short form to add your support to our letter to the Chancellor.

‘If we share what we already have more fairly, we can improve people’s lives right now without having to plunder the Earth for more. Fairness is an antidote to the growth imperative.’   Jon Hicks[1]

Most consumers have heard of the term ‘Fair Trade’ even if they don’t fully understand what it means[2].During the noughties the Fairtrade label became increasing prominent on our supermarket shelves, with brands such as Café Direct and Divine Chocolate– companies founded on fair trade principles – offering a range of premium, ethical hot beverages and confectionery. At the same time big global corporations such as Mondolez (Cadburys) adopted the Fairtrade certification scheme, whilst major high street retailers – Sainsbury’s, Tesco’s, M&S and even low costs names such as Lidl and Aldi – also joined the independently audited labelling initiative. It seemed that the consumer had easy access to and was choosing to make ethical purchasing decisions that put people and planet before profit margin.

Then things seemed to change. Alongside ‘ethical consumerism’ came low cost price wars between food brands and retailers as margins were squeezed. In this environment, the Fairtrade certification scheme was ditched by several significant brands and retailers in favour of cheaper ‘ethical labelling’ initiatives, including in-house labels such as Cadbury’s ‘Cocoa Life’.  Whilst arguably better than nothing, many such schemes are not independently or as vigorously audited, particularly in relation to human rights issues. In 2017 several large chains withdrew from licensing their own brands as Fairtrade due to the costs of the scheme. Overall, Fairtrade sales in the UK do (still) continue to grow and at the end of 2019 the UK household groceries sales of Fairtrade labelled products stood at nearly £798 million[3]. However, this figure represents a 5% decrease since 2017, whilst in Scotland the decrease on shopping basket sales of Fairtrade goods was 9%.  Consumer choice and visibility of ethical brands has been significantly diminished.

Meanwhile B Corps like Divine Chocolate, which turns over £16 million in sales and is 45% owned by a Ghanian farmers’ co-operative, now find the majority of its sales come from the non-UK market. Such Fair Trade Organisations have found it hard to maintain their UK market share, with major retailers ‘choice editing’ to reduce the premium offers on shelf, in anticipation of consumer demand for lower pricesAnd whilst it is commendable that low cost retailers have maintained the Fairtrade label on own brand coffee and chocolate, it’s worrying that these same companies score abysmally in independent reviews of their human rights and environmental practices, as revealed by Oxfam’s latest findings[4] .

How is this relevant to the Wellbeing Economy movement?

In an independent review of Fair Trade in Scotland carried out for the Scottish Government’s International Development division in 2019, we found  compelling arguments for closer alignment of the Fair Trade movement with WEAll’s goals. Just as the Wellbeing Economy Alliance advocates transitioning to economic models where ‘humanity defines economics not the other way round[5], so fairness and equity in trade aims to address the inequality of the world’s most marginalised communities directly suffering the consequences of richer countries’ consumption.  Fair Trade argues for an equitable trading model where social impacts take precedence over economic indicators such as GDP growth.   It is a “a multifaceted political and economic phenomenon, driving and catalysing change in the way business is done, how consumers consume and how producers produce’[6].

For those seeking to influence the conversation on more equitable economic models, efforts to achieve sustainable livelihoods for the world’s most marginalised producers, often women, cannot take second place to domestic concerns. It means advocating for wellbeing policies and fair business practices at national level and informing the way we relate to our trading neighbours internationally. Wellbeing in relation to trade has to impact on much more than governments’  international aid efforts and rather focus on the manner in which our public and private agencies procure, the rules of engagement for doing business with social enterprise (such as B Corporations and FTOs) and the prioritisation of dignified  and equitable trading relationships through EU and global trade rules.  It is not enough to use the Global Goals to interrogate a country’s domestic approach to inclusive economy, though this is a good start.

Scotland’s National Performance Framework

Scotland’s National Performance Framework[7] (NPF), has developed wellbeing indicators alongside more traditional GDP based growth measures, but it needs to view each indicator through a global lens in order to achieve real economic change. The Scottish Government’s Fair Work policy, for example, is reflected in the NPF and incorporated within a ‘Scottish Business Pledge’ to which Scottish business can subscribe.  It could be reflecting a global perspective in the way Scottish business interact with international labour markets, if it were to incorporate Fair Trade principles such as fair payment, good working conditions, no discrimination, gender equity and freedom of association into the way business is done internationally. All of these are Fair Trade principles, as can be seen in the figure below.

Graphic from International Fair Trade Charter, 2018

Using Fair Trade Principles as their ‘SDG+’ benchmark, governments aspiring to the Wellbeing Economy vision, including Scotland, can be more ambitious in challenging how their own statements about wellbeing translate into practice globally; it is not enough to speak of putting wellbeing first domestically, whilst championing business growth predicated on export and import practices which perpetrate environmental and human rights abuses.   Disrupting the status quo on the way we do business as nations requires a multi-pronged approach across education and upskilling of our workforce in public, private and third sectors; it requires serious support for ethical business models, and a recognition that as electorates we are increasingly aware of the complexities and ethical challenges of our purchasing choices and those which our Governments make on our behalf.

Pauline Radcliffe was the lead author of the Independent Review on the Future of Fair Trade in Scotland for the Scottish Government International Development division, published February 2020. This review included an interview with WEAll Scotland trustee Sarah Deas.

Header image: Comfort Kumeah, a Ghanian cocoa farmer from the Kuapa Kokoo co-operative which owns 44% share of Divine Chocolate and is led by women.  Credit to: Olivier Asselin on behalf of Divine Chocolate Ltd

 

 

[1] Hicks,J; Should we pursue boundless economic growth? Prospect magazine, 12.06.19.

[2] In Scotland 90% of those surveyed in 2016 had heard of Fair Trade; across the UK, 83% consumers stated that they would trust the Fairtrade Mark; .

[3] Kantar Worldpanel: consumer Fairtrade sales in UK and Scotland 2017 and 2019, week beginning 05.11.

[4] https://oxfamapps.org/behindthebarcodes/

[5]WEAll Scotland home page

[6] Tiffen, P. Who cares about Fair Trade? Journal of Fair Trade 1:1, 2018.

[7] Scotland’s Wellbeing – Delivering the National Outcome: Scottish Government, May 19. P.14

The Edelman Trust Barometer has been measuring public trust in institutions for over 20 years. Its new 2020 report reveals that a “sense of unfairness in the system” is driving lack of trust in governments, businesses, NGOs and the media.

More than half of respondents globally believe that capitalism in its current form is now doing more harm than good in the world.

Edelman describes a mood of fear over hope, with 83 percent of employees saying they fear losing their job.

The barometer also found that “trust is undeniably linked to doing what is right.” Edelman said:  “After tracking 40 global companies over the past year through our Edelman Trust Management framework, we’ve learned that ethical drivers such as integrity, dependability and purpose drive 76 percent of the trust capital of business, while competence accounts for only 24 percent.”

These responses send a clear message that the current economic system is not working for people. It’s time for a wellbeing economy: these latest Edelman Trust Barometer findings simply underscore the urgency of the need for change.

Find out more on the Edelman site here.

What exactly is a wellbeing economy and how can we put it into practice?

What are the options and what is the path that makes sense in each particular business context?

‘The Business of Wellbeing: a guide to the alternatives to business as usual’ is a new publication launched today by WEAll. It aims to answer these questions, and to inspire decision makers at small- to mid-sized organisations to explore the wellbeing economy space.

It includes:

  • Analysis of the dimensions businesses need to deal with when trying to contribute to building a wellbeing economy, from leadership to accounting for impact;
  • Case studies of pioneering businesses to inspire what’s possible;
  • Expert views on how to navigate transformation;
  • A self-assessment tool to help decision makers plan their next steps.

The guide was created through a participatory process, with a steering group of business and wellbeing economy experts.

Ten stakeholder interviews were carried out to gather input from different solutions providers and to give us insights on challenges facing decision makers.

The guide doesn’t aim to give a complete overview of solutions – but it does shine a spotlight on a selection of those we believe could be useful on your journey.

The guide was facilitated and co-designed with SenseTribe Consulting.

Download the PDF guide here – or explore extracts in our dedicated Business of Wellbeing web portal.

Tony’s Chocolonely was founded 13 years ago by journalist Teun van de Keuken. Teun was shocked to discover that much of the chocolate sold in supermarkets was made by people working in slave like conditions. When he tried to discuss the situation with chocolate makers, many declined to discuss the issue.

Teun van de Keuken, journalist and founder of Tony’s Chocolonely

Malpractices in the cacao industry drove me to set up Tony’s. Many plantations in Western Africa practice slavery and child labour even today. That’s what we want to help to prevent.
Teun van de Keuken, journalist and founder of Tony’s Chocolonely

 

Being a journalist, Teun had investigated the number of children working on cocoa farms and how many were working under illegal and dangerous conditions. This was what motivated him to create Tony’s. 

From the outset, it was clear that a mission to eradicate modern slavery from all chocolate production went way beyond measuring Tony’s direct impact.

 

Alone we make slave-free chocolate, together we make all chocolate 100% slave-free. One of the main things we’ve learnt along the way is how difficult it is to change an industry. After 11 years we’re not there yet. We’re actively seeking partners who apply our model.
Teun van de Keuken, journalist and founder of Tony’s Chocolonely

Tony’s strategy roadmap to achieve the goal of 100% slave-free chocolate consists of three pillars: 

Extract from Tony’s Chocolonely annual report 2018/2019

It is these three pillars that form the measurable impact of Tony’s Chocolonely. The company also follows the GRI (Global Reporting Initiative) guidelines for sustainable reporting as well as the usual financial accounting metrics. he metrics relating to their roadmap are their clear indicators of impact and success. In their 2018/19 annual report, this meant 13 key metrics linked to the three pillars.

The newest of these metrics is linked to the third pillar and is all about the start of Tony’s Open Chain, an open source platform where chocolate companies can access the necessary knowledge and tools to improve their supply chain. 

On its own, a certification label does not enable farmers to live above the poverty line and provide a decent income for their families. The way we see it, chocolate makers are responsible for their chocolate supply chain – not the certification inspector.
Teun van de Keuken, journalist and founder of Tony’s Chocolonely

 

Tony’s Chocolonely

Critically, Tony’s recognises that it cannot do it all by itself and its business goal can only be achieved in collaboration with others. This it acknowledges in the way it reports its impact, highlighting the contribution of others.

In 2018/2019 Tony’s Chololonely expanded to 143 employees with a revenue of roughly 70 million euros. Over 53 million of this revenue came from the home market of the Netherlands, and the business is now looking into international expansion. Take a look at the latest annual report here to find out more about the size and complexity of the problem, about what is going well for the business and what still needs to be improved. 

 

  • This is an extract from the forthcoming ‘The Business of Wellbeing – Alternatives to Business as Usual’ Guide, launching in January 2020. For more extracts, please click here
  • To stay informed of the release of each extract, please sign up to our newsletter here.

If we want to contribute to value creation, health, safety, ecosystem survival and human wellbeing, it is important to include them as metrics in our balance sheet.

Martin Rich, FutureFit

The more you outsource externalities, the better you do financially in today’s system. If companies outsource all harm you never have to account / pay for it.” 
Martin Rich, Co-Founder and Executive Director at Future Fit

We need to consider our own operations and also the full supply chain and product life cycle. Only this way can we measure performance indicators in a similar way to financial performance. However, can we ever compare the value of a tree to the value of a mother in monetary terms?

James Vaccaro, Special Advisor to Triodos Bank

People want to measure everything but it is not always healthy. You can hit the target but miss the point.” 
James Vaccaro, Special Advisor at Triodos Bank

 

Rather than blindly tracking our performance towards a framework like the Sustainable Development Goals, we need a clear idea of the future scenario we want to create as part of our business purpose, a plan on the business’ contribution to this scenario and clear performance indicators on how to get there. 

We need a clear understanding of a desired future scenario that is easy to communicate. This provides us with a shared starting point so we can effectively work together on the desirable change. Frameworks like the Natural Step can help us develop such scenarios. 

Natural Step Framework

 

We then need a bold set of processes, tools and practices that help us facilitate action and a clear set of performance indicators that we can measure success on.

There is always the temptation to take off the shelf (ready-made) indicator sets, both for ease as well as comparison with other organisations. However, we would suggest first asking yourself the question: Do these indicators accurately reflect the change that your business wants to achieve?

Much time and energy is wasted collecting lots of data for tick box activities as opposed to measuring whether the change (those activities were designed to achieve) has actually happened. 

It is not the amount of training provided but what people do with that training that matters. Measuring impact should not be different from measuring key performance indicators (KPIs). A forward-looking set of KPIs should instead be the impact you want to achieve. 

In recent years, alternative return on investment methodologies have emerged to assist businesses in bringing their social and environmental impact into the balance sheet. These can be useful, but only if their limitations (valuing nature, dubious discount rates) are recognised and the data is fed back in a format that enables people to take action. Measuring for measurement’s sake is just not worth it.

Often t the story of how the impact is achieved (rather than the return on investment calculations of the impact) is the most useful information an organisation takes away from such an exercise. 

We can only operate at environmental and social loss for so long, otherwise we will go bankrupt.” 
Martin Rich, Co-Founder and Executive Director at Future Fit

Ultimately business needs to find ways to design wellbeing into their economic system and incentivise those actions that have the potential to substantially contribute to positive impact.

 

Unusual Rigging (Unusual) began their circular journey around five years ago. Embedding of the principles of the circular economy in the business has been the guide for this journey.

Historically, Unusual has employed a rental system for its products which has been efficient at managing material loops. As the company strives to transition towards a fully circular business model, its new goal is to become effective at closing material loops. 

In short, the company is striving to:

  1. Prolong the life of their products
  2. Design their products for disassembly and resource recovery
  3. Offer products as a service

A key innovation that is helping them to achieve these goals is their asset tracking software system. This system, first introduced in 2014 for their own products (and in 2016 for those of their clients), provides Unusual with the ability to conduct predictive maintenance and gives each product a material passport. 

By no longer viewing their products as having a limited lifespan means Unusual are able to design and offer them as a service. It resulted in more than 50 tonnes of steel being reused during the course of a year, saving thousands of tonnes of CO2 emissions. 

“We would define [the circular economy] as an economy ‘where objects never die’ – we are dealing predominantly with ‘technical nutrients’ – finite stock that through digital innovations can continuously be tracked, assessed, utilised and returned with an almost zero marginal loss in values.”
Tom Harper, Director and Head of Circular Economy, Unusual Rigging

 

In terms of closing their own energy needs loop, the company has committed to renewables to power their principle site through the installation of  solar panels. 

An important additional step Unusual are taking is to share the story of their journey of working collaboratively with their community of suppliers and customers to bring the circular economy to their industry. Through collaboration and sharing they are demystifying innovations in the circular economy and showing that it is not just achievable but optimal for medium size businesses to also embark on that journey.

Established in 1983, Unusual Rigging is the UK’s most experienced provider of rigging and stage engineering solutions, working across Europe, principally in the entertainment, special event, exhibition and presentation industries.

  • This is an extract from the forthcoming ‘The Business of Wellbeing – Alternatives to Business as Usual’ Guide, launching in January 2020. For more extracts, please click here
  • To stay informed of the release of each extract, please sign up to our newsletter here.

Currently, about 2.01 billion metric tons of waste are produced annually worldwide and only a fraction of that is recycled or composted. The World Bank estimates overall waste generation will increase by 70% by 2050. In a world full of waste, what products and services does the world truly need? 

Dave Weatherhead, Managing Director of Kinesys

“Business should ultimately aim to give people jobs that improve their lives and to produce products and services that improve the world.” 
Dave Weatherhead, Managing Director of Kinesys

New York University Center for Sustainable Business (CSB) has identified a growing consumer demand of sustainability-marketed products, however these currently only account for under 17% of the current market. But does sustainability as we understand it enhance the world? 

William McDonough, author

“I ask myself occasionally if the word sustainability is the right word to use. If sustainability is just maintenance, perhaps we can go beyond it. Is being less bad being good?” 
William McDonough, co-author of Cradle-to-Cradle

 

Designing products and services that last

Reduce, reuse, recycle. We are all now familiar with this slogan. However, it is still only recycling that has really taken off. 

The problem is, that if we design products that go to waste after a certain lifespan, even if we recycle, the raw material loses value. There is energy lost along the product lifespan, throughout research and development, production, transport, maintenance and the recycling process. Many industries design their products to break after a certain period of time so they can be replaced by a new (possibly improved) version – so called “planned obsolescence” .

“I see design as a signal of human intention. We need to stop designing things for end-of-life, designing for next use is just a different way of thinking.” 
William McDonough, co-author of Cradle-to-Cradle

 

Image: Ellen MacArthur Foundation infographic

The image above presents three principles of a circular approach for product design. Waste and pollution are largely a product of how we design and so can be designed out. Keeping products in use is all about reusing, repairing and remanufacturing. Regenerating natural systems is making sure that every end of use /spare resource is food for another sector.

Creating space for learning and innovation

Traditional innovation processes tend to leave out the bigger ecosystem picture and to focus on satisfying consumer demands. There is a need to map raw material flows, energy use and stakeholders in order to develop a balanced approach that creates value for all that are involved. 

“The current linear economy is following a cradle-to-grave model, we are looking at eliminating the concept of waste using biological and technical nutrients.” 
William McDonough, co-author of Cradle-to-Cradle

No matter if you apply human-centred design, design thinking, biomimicry or circular design processes, a circular design approach includes ecosystem awareness in every step of the product and service innovation process.

Offering services rather than products

One way to radically reducing material use is to move from offering to sell a product to selling a service. Offering products as a service is a model which returns the ownership and responsibility of the product back into the hands of the producer. Selling a product as a service makes energy efficiency and sustainability profitable. It makes cutting costs through designing for disassembly and resource recovery attractive. Modular design becomes the default for designers, making extending the life of the product attractive. 

A good example of this approach is Philips’ selling of light as a service rather than lighting units as a product. With a 5-year service agreement to supply lighting in Schipol airport, designing lighting units to be easily repairable makes financial sense for Philips and reduces the price to the client. 

For Riversimple, a company featured in another case study in the guide, they include not only all elements of car ownership in their service offer – the vehicle, repair, insurance but also the (hydrogen) fuel. This allows them to exercise their greater buying power to keep down (hydrogen) fuel costs.

Moving towards a circular economy

As we move towards a circular economy, we start seeing more opportunities in stakeholder collaboration. Suddenly organizations like Circle Economy find that a neighbourhood community can benefit from the heat created during the manufacturing process of a nearby factory, sharing platforms can facilitate the exchange and reuse of goods and we can benefit from open design processes that involve citizens to solve local challenges, like with OpenIdeo

A circular economy system is one where collaboration prevails and where there is no need for patents and idea ownership. An example here are Tesla and Riversimple. The real value is created through expertise, mutual benefit and collaboration. Learn more about the circular economy here. All the concepts mentioned in this article talk to the wellbeing economy – the wellbeing of the planet.

Maroma was founded in the late 1970s by Paul Pinthon and Laura Reddy and is now a multi-million dollar business with over 80 staff. The Indian business sells home fragrance and body care products: incense, candles, aromatic essence, reed diffusers, room fresheners, votive, candles, gift sets, potpourri, fragranced mats, perfume spirals and perfumed sachets.

The Auroville community owns all shares in Marona. While the CEOs of Maroma are founders and follow the charter of Auroville, along with the other business owned by the community, Maroma’s employees have the autonomy to run and manage the business.

Maroma’s profits constitute its contribution to the Auroville Foundation. These funds serve to finance and create infrastructure assets in the sector of road building, water and sanitation, power (including from alternate sources such as solar, wind and biomass), as well as telecommunication, and housing for Auroville residents.

Erinch Sahan, World Fair Trade Organisation

“Maroma is a quintessential example of an enterprise fully embedded in its community. It has a governance and business model that locks-in its social mission. After 40 years of serving its community, Maroma demonstrates the resilience of the Fair Trade Enterprise model. It shows that business can be designed to put people and planet ahead of growing its own profits.”
Erinch Sahan, CEO, World Fair Trade Organisation

 

 

Maroma aims to achieve a balanced relationship with its suppliers through selecting suppliers that are able to offer products that match product specifications but allowing suppliers to set their own prices. If suppliers get into economic difficulties, Maroma looks to support them to move through those difficult times.

Maroma is verified by the World Fair Trade Organization as a social enterprise that fully practices Fair Trade. This means they structured as a mission-led enterprise as well as implementing the 10 Fair Trade Principles in all their operations and supply chains.

Find out more about Maroma in this World Fair Trade Organisation podcast.

  • This is an extract from the forthcoming ‘The Business of Wellbeing – Alternatives to Business as Usual’ Guide, launching in January 2020. For more extracts, please click here
  • To stay informed of the release of each extract, please sign up to our newsletter here.

 

James Vaccaro, Triodos Bank

If people feel they cannot be seen by anyone else it brings out the worst in them. If they feel part of a community, this brings out the best in them.”
James Vaccaro, Special Advisor at Triodos Bank

In business, the value of stakeholder engagement is often not fully appreciated. The results of such engagement usually only become visible in the mid to long term. When we consider social and environmental impact as part of business, we need the long-term support of our stakeholders. 

Recognizing the role we play in the wider system and in our industry can make what we do much more powerful. There are three levels in which we see community play an essential role in supporting business in the wellbeing economy: 

Genuine and balanced supplier relationships 

Suppliers form one of the three most pivotal relationships we have at work alongside customers and colleagues. Yet how often do we think of them as part of our community? How balanced is the relationship we have with them? 

It might be the case that our suppliers are larger and more powerful than us or vice versa. Regardless of which way around it is, genuine and balanced relationships can be forged if businesses go beyond compliance to a deeper relationship of shared values. 

Often it is easier just to tick a box, but we have seen that the most forward thinking businesses go deeper to cultivate relationships based on shared values…and why wouldn’t they? 

Building relationships with suppliers around a shared purpose and with similar value sets can increase reliability and simplify collaboration.

As the economic systems begin to transform, will we only be able to succeed by treating suppliers as a vital part of our community.

Ultimately the boundaries around organizations will become less fluid. What we will see will resemble an organizational ecosystem rather than large organizations.”
Daniel Christian Wahl, author

 

 

Finding your place in the community

Often as a business, we choose to locate our offices and sites based on accessibility, tax rates and employee wages. But how much do we consider our relationship to the communities we are a part of?

Business can be a catalyst for exchanging knowledge and collaborating at the local and regional level, generating value in their location and beyond. Through working with other local stakeholders early on, a business will find how  it can contribute to supporting a vibrant local area. 

Rehema Isa, Womanomics

We need collaborative creation processes to define and design together what wellbeing means in each organization and local context. We need access to spaces that allow us to be part of the change scenario and explore how we can contribute to the ecosystem.”
Rehema Isa, Womanomics

 

 

Depending on local conditions a businesses contribution could look different, for example: ensuring that employees get safely to their workplace and back home during a night shift or supporting local governments with education around waste management and recycling. 

Recognizing your role in the wider system

Being a pioneer is not easy, but if we want to achieve change in our sector, we need the ability to recognize the potential that comes with forging a new path. 

No matter if you work in the chocolate industry, banking, hospitality or reforestation, hearing how challenges were experienced and solved by other leaders can give us inspiration. Understanding where luck and human connection made a difference, gives us courage to take up the challenge of rethinking business as usual.

We at Triodos are an important drop in the ocean, but we remain a drop in the ocean. Only if we recognize our place within the wider systemic spectrum can we really have an impact.
James Vaccaro, Special Advisor at Triodos Bank

 

Many organizations that provide support to businesses have recognized the importance of communities of practice. Organizations like the Impact Hub have based their business model on the value they provide through an active community of support.  

That’s why communities of practice provide great support to leaders and changemakers:

We see ourselves as a provider of credit and capital. However we also provide value in being at the centre of a community and therefore play an important social function.
James Vaccaro, Special Advisor at Triodos Bank

 

 

Lancor is a cooperative with 89 employees and 76 years of history. The company started off as a family business and is now specialised in the production of elevation machinery and wind generators, with a large additional portfolio of innovation and development projects. 

In 2005, the business was in a moment of crisis when Koldo Saratxaga from NER Group met with them and offered a transition towards a model of self-organization. In a leap of faith the employees decided with near unanimity to embrace the NER group model. In 2013 the cooperative Lancor 2000 S.COOP was founded. 

This was a radical change for the organization. The team had experienced many tensions and mistrust in the past: managers had committed to a workload that workers in the workshop didn’t feel was realistic. The change was challenging for former leaders who had held their positions for many years. Also for the workers, who struggled as they suddenly had to coordinate work themselves in their teams. 

“Most of us who coordinate have started in the workshop, like me. We got the opportunity from our coworkers to be coordinators.”
recalls Javier Dosuna, General Coordinator at Lancor

Javier Dosuna, Lancor

Today, Lancor has worked for over 10 years with a ratio of 99.5% in-time delivery, something that few manufacturing companies ever achieve. When the cooperative started the transformation, the business was depending on 4 clients, a situation that created a great risk for the business. Today the team has managed to widen the client and product portfolio. 

“We have won the trust of people through absolute and total transparency. Every month we meet and all information is shared with relation to finance, client situation etc. and we make decisions around investments where everyone can contribute and is represented.”
comments Javier Dosuna

 

From a situation of 450k Euros of loss in 2005 the company became profitable in 2006 and generated a €1M profit in 2018 (with a turnover of around €20M) with almost the same number of employees. 

The NER Group model is flexible but never the same, so we have adapted it to our needs. We are what we want to be and work as a combined entity that makes decisions about its development.”
adds Javier Dosuna, General Coordinator at Lancor

 

NER Group is an association in which diverse organizations, united by a shared organizational model, approach and culture that fosters self-organization, share experiences, synergies and knowledge. The group represents nearly 2,700 employees with an annual turnover of approximately €400 million. 

  • This is an extract from the forthcoming ‘The Business of Wellbeing – Alternatives to Business as Usual’ Guide, launching in January 2020. For more extracts, please click here
  • To stay informed of the release of each extract, please sign up to our newsletter here.

Nobody is born a perfect leader or entrepreneur. To be good at either means being able to take a risk. A leader might at first fear such actions, as they might think it appears as ‘weak leadership’, or not ‘leading from the front’. These fears are understandable, but as a business matures we naturally need to create space for participatory leadership…you can’t do everything yourself!

Lili David, Sociocracy 3.0

“Decentralize as much as possible, and retain as much influence as necessary.”
Lili David, Co-Developer at Sociocracy 3.0

 

Skilled leadership comes through an awareness of yourself as well as your changing external conditions. Understanding how the two combine is critical to knowing how your leadership can best serve the business. 

We have identified two key features of leadership and participation in a business that can flourish in a wellbeing economy: Trust and Control

 

Trust as a balancing act 

According to recent 4 year research study on team effectiveness carried out by Google, psychological safety was identified as the single most important dynamic of an effective team compared to a less effective one. Their research also revealed that sales teams with high ratings for psychological safety actually brought in more revenue.

A climate of openness with the possibility of admitting errors and speaking about them openly, is one of the key factors that also Harvard Business School Professor Amy Edmondson confirms to be crucial for psychological safety. 

Miki Kashtan, author

When we don’t experience trust, as when we don’t experience safety, we shut down, protect, and hide our vulnerability. We also, in both cases, tend to place responsibility for our experience on the outside.
Miki Kashtan, author and international CNVC trainer (from her blog post) 

 

As a leader you can support a sense of safety by framing challenges as open learning questions that require everybody’s input. 

 

Marcos Leite, OLX Brazil

“We need people who challenge the status quo, and openness in the management team to be challenged.
Marcos Leite, EVP & Chief Commercial Officer at OLX Brazil

 

Showing your own fallibility by openly requesting support and modelling curiosity by asking many questions can also help to stimulate a learning environment that creates space for innovation, exploration of new ideas and the possibility to make mistakes.  

 

Feeling good in and out of control 

We like to feel in control and often delegating responsibility is a big challenge for leaders. Sometimes, because of a lack of knowledge and maturity in the team. Sometimes because the leader struggles to let go of control. 

How can we provide the minimum amount of structure to allow the maximum amount of autonomy in our team; the best value to our customers; whilst making the leader feel good being ‘out of control’?

Erinch Sahan, WFTO

To move towards wellbeing economy you need to give up power, are the decision makers ready to do it?
Erinch Sahan, Chief Executive at World Fair Trade Organization

 

‘Giving up’…or as we would rather put it…’sharing’ power can be one of the best things a leader can do for the organisation. The Google study has identified dependability, clarity and structure as additional key elements for effective teams. 

 

Distribute the power to influence, to enable people to decide and act for themselves within defined constraints. Being clear about responsibilities and constraints when you delegate, as well as offering support if necessary, are key to the success of effective collaboration.Lili David, Co-Developer at Sociocracy 3.0

 

The benefits of effective delegation of responsibilities can be many: Firstly, delegating decision making creates a broader accountability base within the business. Secondly, decisions can be more effective as they no longer just rely on one person’s gut. Decisions can be made by those closer to the effects of those decisions.

Activating collective intelligence across the system

Ultimately, sharing control can liberate a leader as the business grows to provide guidance and strengthen the capabilities of their team. It can afford them to play the role of coach and mentor in areas they once dominated themselves.

We want to spend the time we have available where we can create most value, and often leaders create value by serving as motivational leaders, inviting in clarity and structure where it is needed and creating a culture of learning and innovation. 

James Vaccaro, Triodos Bank

We need to support founders with the elements they struggle with most so they can focus on what they are good at and where they can create impact.
James Vaccaro, Special Advisor at Triodos Bank

 

 

 

 

At the end of 2017, Auchrannie resort on the island of Arran in Scotland became the first Scottish resort to transition to a model of employee ownership. A trust now owns 100% of the company’s shares on behalf of its 160 employees.

The co-founder, and Managing Director since 2010, Linda Johnston said of the employees in relation to the transfer:

“They realise that what each of them does will affect the future success of the business and that this is directly linked to their own success, so they have already become more engaged in making the business better and understand the power and influence each and every one of them now has on their own future.”

 

New targets for the business

New efficiency targets for the business, agreed by the ‘new owners’, created the conditions to become a Real Living Wage Accredited Employer in April of 2018.

While the efficiency targets helped boost profitability, paving the way for the introduction of the Real Living Wage, there was also a recognition that the introduction of the wage would in and of itself support further financial benefits. These included lower staff recruitment costs (due to higher retention), greater productivity and increased occupancy from an improved reputation.

Linda Johnston, MD of Auchrannie resort

“Employee ownership will give the whole Auchrannie team a stake in the continued growth of the business. All of us will work together to build a more efficient, sustainable and profitable business.”
explains Linda Johnston

 

Since the acquisition of a 16-room guest house in 1988 by Linda and her late husband Iain, the resort has become home to two 4-star hotels, 30 5-star self-catering lodges, 14 luxury ‘Retreats’, two leisure clubs, 3 restaurants, children’s playbarn, a destination spa and outdoor adventure company.

 

Ownership transfer as an exit strategy

The ownership transfer was born of a desire for an exit strategy by the Johnston family (sole owners of the resort) that would allow the business to continue to flourish as well as upholding the ethos of the company, maintaining and motivating the team plus continuing the community’s access to the facilities of the resort.

“We are confident that the collective efforts of our fantastic team will continue to strengthen Auchrannie’s customer care and community focus as well as improving the sustainability of the business going forward.”
adds Linda Johnston, MD and former owner of the resort

Crucially, the transfer arrangements were designed for it to be affordable to the business to be able to reinvest in the future as well as financially reward the employees after the transfer. The previous shareholders will be paid out of the profits of the business over the next 25 years.

  • This is an extract from the forthcoming ‘The Business of Wellbeing – Alternatives to Business as Usual’ Guide, launching in January 2020. For more extracts, please click here
  • To stay informed of the release of each extract, please sign up to our newsletter here.

 

No founder will ever forget the day their business legally came to life. The birth of this new entity comes with a great sense of responsibility. Many business owners feel a great deal of emotional attachment to their creation as it unfolds, develops and grows. 

Ownership and governance play a crucial role in business as we attempt to transition towards a wellbeing economy. Holding on to what is most important can require reimagining what it means to own something. Here are 3 important elements to consider: 

  1. Decision making
  2. Growing pains
  3. The Social and the Environmental

How can ownership support effective decision making?

Recent research has shown that more than two thirds of employees are not fully engaged in their work, affecting motivation, commitment and ultimately also productivity.

James Priest, Co-developer of Sociocracy 3.0, LearnS3

“Collaborative endeavours will be more effective if people affected by decisions are involved in making them, or at least that they are able to influence decisions that affect them, on the basis of sound reasons for doing so.”
 James Priest, Co-developer of Sociocracy 3.0, LearnS3

 

According to a recent McKinsey survey, we spend about 37% of our work time on decision making.

Decision making, made in the absence of an understanding of the full picture, can affect the level of agility to respond to a changing environment (changing market demands, risk factors, regulations etc.). 

In commonly used ownership structures, influence and business information are mostly centralised to a few decision-makers. As a result, employees, customers, and affected communities and the planet are often left out of decision-making processes.

“Management hierarchies centralize decision making. While this is effective in some contexts, collaborative endeavours are more likely to succeed if you shift responsibility for significant elements of decision making close to where value is created.”
 James Priest, Co-developer of Sociocracy 3.0, LearnS3

 

Ultimately, ownership should not be a roadblock to productivity. It should enable it by delegating governance to those affected.

How can ownership affect our trajectory?

Many companies started out life in response to a social need – sometimes influenced by their founders’ religious beliefs. The UK confectionery Cadbury’s was begun by a Quaker. The Spanish cooperative Mondragon by a Catholic priest. The UK retailer Marks and Spencer by an impoverished Jewish boy from Belarussia. These organizations, like many others, have struggled through organisational growth and change of ownership to stay true to, and serve, their initial purpose. 

An ownership and governance structure that supports affected key stakeholders to have a voice in decision-making can help organisations to stay true to their mission. 

Katherine Trebeck, author of The Economics of Arrival

“Investor demands on business can take away from a business’s original mission. Without ownership and governance models designed to protect the interests of all stakeholders, there is a risk that actions focussing on the short-term will prevail.”
says Dr. Katherine Trebeck, author of ‘The Economics of Arrival’

 

As companies grow, they often start to be viewed as commodities, controllable by the highest bidder. Business-as-usual governance models are designed to maximise shareholder influence and often ignore stakeholder interests.

 

Martin Rich, FutureFit

“Listed companies are owned by nobody because they’re ostensibly owned by everybody, the result is a lack of responsibility.”
Martin Rich, FutureFit

 

This means economic interests and short-term profit gains can often overrule organisational values and principles, social and environmental concerns and even the long-term success of the business.

Even Patagonia, often held up as the poster child of sustainability, is wrestling with these questions as they head north of the $1bn mark in annual sales. They are beginning to question whether their scale is a hindrance to being truly regenerative.

Hunter Lovins, President of Natural Capitalism Solutions

“Scale is a real problem for change.”
Hunter Lovins, President, Natural Capital Solutions

 

As a business grows and occupies a new role in the market, there is a need to evolve to a model of stewardship. This means influence is delegated to a range of stakeholders to ensure informed decisions can be made by those affected.

 

Who’s responsible for the social and the environmental?

Traditionally, consideration of social and the environmental impacts was an afterthought for businesses, once the business of the economic i.e. financial had been taken care of. That has begun to change with statements from various business groupings that profit maximisation will no longer be the sole focus for their business.

Patrick Andrews, Co-Founder of Human Organising Co.

As a general rule, ownership brings responsibility. So it’s something of an anomaly that the owners of companies have no legal responsibility for their actions. If you own a share in a company that breaks the law, pollutes the environment or even kills someone, you can’t be touched. Is this not strange? 
Comments Patrick Andrews, Co-Founder of Human Organising Co.

 

However, saying it and actually doing it are two very different things. One way to help ensure we move from words to action is by bringing other voices into the governance model. Check out our first case study – Riversimple for such an example. Another is employee ownership, a model discussed in our second case study, that of Auchrannie Resort.

By Lisa Hough-Stewart

Last week WEAll was delighted to partner with Thomson Reuters Foundation to deliver a lunch event on wellbeing economics as part of their flagship Trust Conference in London.

Energy and ideas were flowing as a packed room full of leaders from the worlds of business, development and philanthropy (and beyond) discussed how we can better work together to transform the economic system.

WEAll Executive Chair Stewart Wallis inspired participants with a short introduction, explaining that “he’s been trying to change the world for a long time” and that what he had learned from over 50 years of work was that:

“Where a cause is both just & urgent, and we collaborate across barriers, it’s possible to achieve the seemingly impossible”

After Stewart outlined what the vision of a wellbeing economy looked like, participants round the table shared their dreams for what would change in the next ten years to help bring this about. Some named equality for all; others talked about decision making and monetary flows being based on solutions not problems; and we shared ideas about bringing all voices to the conversation and changing power structures.

It was clear that the vision for the world we want to live in is rich and shared by many – how we get there is less clear. This is where WEAll comes in – and Stewart invited everyone to participate as members or in some other capacity with our work.

The event was a great starting point for new ideas and relationships, and we are excited to build on this strong beginning.

It came as part of the two-day Trust Conference, which showcased innovative examples of pioneering business practices around the world and explored solutions to human rights challenges.

One highlight was a celebration of the Wellbeing Economy Governments partnership, with video clips of leaders Nicola Sturgeon of Scotland, Jacinda Ardern of New Zealand and Katrin Jakobsdottir of Iceland helping raise awareness of this important project.

I was personally incredibly impressed with two businesses in particular that we heard about: Nik’s Fudo in Geneva makes feminist economics a reality, providing business opportunities to migrant women enabling them to share their cooking skills and amazing food. Annie Cannons in the Bay Area trains and employs survivors of human trafficking in their cutting edge coding and tech company.

Both of these examples give me hope that innovation, entrepreneurial spirit, feminism and kindness can come together to support the type of future businesses that should one day be the norm. This is a wellbeing economy in action.

Wellbeing economics featured prominently in media coverage of the event, with Nicola Sturgeon’s TED talk being quoted:
“The goal of economic policy should be collective wellbeing: how happy and healthy a population is, not just how wealthy a population is.”