Natural Capitalism

[Dover]

Natural Capitalism

The previously mentioned core principles form the backdrop for Natural Capitalism, a new and rapidly spreading business model that harnesses environmental performance as an engine of competitive advantage. Our activities are increasingly based on this thesis, detailed in the book Natural Capitalism: Creating the Next Industrial Revolution.

Here's the thesis.

Previous industrial revolutions made people vastly more productive when low per-capita output was limiting progress in exploiting a seemingly boundless natural world. Today we face a different pattern of scarcity: abundant people and labor-saving machines, but diminishing natural capital.

Natural Capital refers to the earth's natural resources and the ecological systems that provide vital life-support services to society and all living things. These services are of immense economic value; some are literally priceless, since they have no known substitutes. Yet current business practices typically fail to take into account the value of these assets—which is rising with their scarcity. As a result, natural capital is being degraded and liquidated by the very wasteful use of resources such as energy, materials, water, fiber, and topsoil.

The next industrial revolution, like the previous ones, will be a response to changing patterns of scarcity. It will create upheaval, but more importantly, it will create opportunities.

Natural Capitalism is a new business model that enables companies to fully realize these opportunities. The journey to natural capitalism involves four major shifts in business practices, all vitally interlinked:
Radically increase the productivity of natural resources. Through fundamental changes in both production design and technology, farsighted companies are developing ways to make natural resources—energy, minerals, water, forests—stretch 5, 10, even 100 times further than they do today. The resulting savings in operational costs, capital investment, and time can help natural capitalists implement the other three principles.

Shift to biologically inspired production models and materials. Natural capitalism seeks not merely to reduce waste but to eliminate the very concept of waste. In closed-loop production systems, modeled on nature's designs, every output either is returned harmlessly to the ecosystem as a nutrient, like compost, or becomes an input for another manufacturing process. Industrial processes that emulate the benign chemistry of nature reduce dependence on nonrenewable inputs, make possible often phenomenally more efficient production, and can result in elegantly simple products that rival anything man-made.

Move to a "service-and-flow" business model. The business model of traditional manufacturing rests on the sale of goods. In the new model, value is instead delivered as a continuous flow of services—such as providing illumination rather than selling light bulbs. This aligns the interests of providers and customers in ways that reward them for resource productivity.

Reinvest in natural capital. Capital begets more capital; a company that depletes its own capital is eroding the basis of its future prosperity. Pressures on business to restore, sustain, and expand natural capital are mounting as human needs expand, the costs of deteriorating ecosystems rise, and the environmental awareness of consumers increases. Fortunately, these pressures all create business opportunity.

The next Industrial Revolution is already being led by companies that are learning to profit and gain competitive advantage from these four principles. Not only that, their leaders and employees are feeling better about what they do.

Shortages of work and hope, of satisfaction and security, are not mere isolated pathologies, but result from clear linkages between the waste of resources, money, and people. The solutions are intertwined and synergistic: firms that downsize their unproductive tons, gallons, and kilowatt-hours can keep more people, who will foster the innovation that drives future success.


.....more > http://www.rmi.org/sitepages/pid61.php

[Coyul]

1. Only when mankind realizes....

...that it cannot eat money, will the rivers and the fields be pure again.
(paraphrase of Native American saying)

[cprise]

2. Ummm

" Capital begets more capital..."

Exploitation of natural resources begets capital; the latter doesn't make anything and the "magic hand of the market" does not exist.

I thought RMI's endorsement of Bush's "hydrogen economy" was questionable, and this perhaps more so. Why would capitalists want to invest in something they cannot own?

[German-Lefty]

3. Right so there's nothing to worry about companies won't do anythign bad

to the enviroment. There are these magic laws of nature that will make them respect nature and improve everything.

You can go smoke a J with this freeper I use to argue with:
http://www.naturalprocess.net/
At least he had some concrete concepts of how, companies would act enviromentally if we bought them off.

Companies may want to "Radically increase the productivity of natural resources." if they own those resources. So if you give a company Yellow Stone National Park, they'll turn it into the best tree farm, coal mine, ranch, or geothermal powerplant to maximize profitablity. Maybe they'll run some of it like a theme park.

Hmm, Rocky Mountain Institute, I wonder who funds them. I wonder if they're a real bunch of enviromentalists or people payed to create disinformation.
http://www.rmi.org/sitepages/pid243.php
Hey look you can give them "stock gifts":
http://www.rmi.org/sitepages/pid95.php

Am I being to harsh?

[cprise]

4. I don't think you're harsh

They strike me the same way.

[Jesse_W]

5. These people can be allies.

Thanks for posting this here. I think corps that applied these principles would indeed be better (and be able to out-comptete those who did not), and unlike some posters here, I am sure that they are possible. This won't lead to perfection, but it will be an improvement. (In some ways it will be worse, also, like everything.)

An example of this is the triumph of Organic agriculture. Once it was something crazy hippies played with, now it's nearly mainstream, and moving with incredible momentum. It did this by being a more effective way to achieve the same ends as conventional agriculture, but doing it in a better way.

[cprise]

6. Where this is leading

The organic farmers' advantage is apparent because all farms are fairly self-contained: They own their farmland, reducing it to a tool with a stark artifical environment (even if organic, a farm is still artificial). This artificiality is geared for short-term results: Success or failure is systematically thrown into high relief.

Without the artificial environment, the advantages tend to be unnoticable. So you could use the backward logic of market fundamentalism to argume that since farms are property then ownership is necessary for productivity, and that environmental resources like the oceans 'fail' because no one owns them; they (incl. the media) will not make much of the actual techniques used for farming (such as letting more natural process take hold in the farm). The blunt but forceful (and wrong) point will be that noting will be considered to really work unless it has a pricetag.

Having logging companies own the forests, and fishing fleets own the seas would be not only a moral travesty. What we would have left over the long-term would not be nature, but tree farms and fish farms.