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Message from the Chairman

by John Elkington 14 June 2010

Getting Into Deep Water:

As the shock-waves from the Deepwater Horizon catastrophe spread around the world, and the oil spread around the Gulf of Mexico, a colleague in Sweden sent me an email reminding me of a glowing profile of BP CEO John (later Lord) Browne that I wrote in 2004 for Time magazine.

Oops.

At the time, BP was still (and I think deservedly) celebrated for breaking industry ranks on climate change in the late 1990s—and for its seeming success in beginning the transition to a ‘beyond petroleum’ world.  In sending the email, the colleague was not (he said) so much mocking me or that Time article, though both would have been understandable.  Instead, he was underscoring the critical—and growing—need to develop much tougher policy and regulatory frameworks to shape corporate behaviour.

True.  Meanwhile, BP’s travails symbolise the uncomfortable fact that our big-footprint economic and business models are taking us into ever-deeper waters, with risks that we have still to fully appreciate.  As our oil addiction pushes us into a growing number of high-stakes technological and economic gambles, it is abundantly clear that governments must create the policy, regulatory and incentive frameworks for more sustainable economies—yet too often they are failing to do so.

The urgently needed government actions go way beyond imposing new regulatory requirements for CSR or sustainability reporting.  It’s time, we believe, to reboot capitalism.  The sheer scale of today’s environmental abuses means that I support the proposal for a new global crime designation of ‘ecocide’

As we argue in our latest report, The Transparent Economy, “Properly understood, sustainability is not the same as corporate social responsibility (CSR)—nor can it be reduced to achieving an acceptable balance across economic, social and environmental bottom lines.  Instead, it is about the fundamental, intergenerational task of winding down the dysfunctional economic and business models of the nineteenth and twentieth centuries, and the evolution of new ones fit for a human population headed towards nine billion people, living on a small planet which is already in ‘ecological overshoot’.”

Increasingly, this isn’t just a corporate or even market agenda, but a civilizational challenge.  This became blindingly clear to us when, earlier in 2010, we helped Dow Chemical think through what the world might be like in 2097, when they hope to celebrate their 200th birthday. The Transparent Economy, resulting from a project funded by Dow, Novo Nordisk and SAP,  was launched on 27 May at the Global Reporting Initiative (GRI) conference in Amsterdam, whose central theme was the need for global economic restructuring and reconstruction.

Such corporations will be critically important in developing, replicating and scaling the market solutions that will be needed in the coming decades.  That’s why we are also working with companies like Allianz, Bayer, HP and Nestlé.  And that’s why we value so highly being able to work with trailblazing organisations like Physic Ventures, the Californian venture capital firm, whose interactive mapping of the new market opportunities we find wonderfully provocative, and zouk ventures, the London-based cleantech fund.

But, as I argued in an essay for a recent edition of McKinsey’s What Matters, the challenge is no longer simply to change hearts and minds in the boards and C-suites of major businesses, a subject we covered earlier in the year in a series of blogs for Fast Company, or even in the innovation labs.

Instead, the challenge is to shift our behaviours, our cultures and, ultimately, the prevailing paradigm.  One of our current generation of interns is helping us explore the behavioural change agenda.  In parallel, we are having stimulating discussions with a number of companies and agencies on the topic—with a potential longer-term action research project in the pipeline.  But the scale of the culture change and paradigm shift challenges is mind-boggling.

If I had to put a label on the emerging paradigm, which I believe started to evolve from the early 1960s, I would call it the ‘Gaian’ or ‘Lovelockian’ Paradigm.  It speaks of a world in which humankind is forced to evolve profoundly different mindsets, behaviours and cultures.  A world in which BP’s original ‘Beyond Petroleum’ branding would make perfect market sense, indeed would be second nature.  And a world in which the services delivered by our biosphere are no longer taken for granted, but instead are accurately valued by market exchange mechanisms.

In this context, May also saw the launch of another Volans report, The Biosphere Economy, sub-titled ‘Natural limits can spur creativity, innovation and growth’.  In the report we quote UNEP Executive Director Achim Steiner to the effect that. “The economic growth of the last two centuries has relied on the mismanagement of natural assets.  Governments are starting to understand that making these assets visible in national accounts and economic strategies is the key to growth in the twenty-first century.”

One way we are engaging the wider culture change agenda is through our evolving ‘Second Half’ Program—with a new dedicated section of the Volans website due shortly.  This area of our work focuses on the overlap between the ageing trend, levels of entrepreneurship and the need for transformative change to achieve anything like a sustainable economy.

In addition to Volans and Cranfield University, the program also now involves Accenture, which has co-hosted a series of Second Half workshops with us.  One key objective: to identify and support initiatives designed to bring those over 50 back into the social economy, through initiatives like the Encore Fellows program developed by Civic Ventures, whose CEO and Founder Marc Friedman presented to the second workshop in the series.

When we launched Volans just over two years ago, we agreed that the first three years would be largely experimental.  We would take risks and see what happened.  In the process, we will make mistakes—as, in retrospect, I did when writing that piece for Time.  But our sense is that in a period of civilizational transformation the number and scale of the mistakes we will make will go off the scale—indeed that very fact would be a lead indicator of long-term success.

The challenge is to share openly what is working—and what isn’t.  Only in this way can we all move up the learning curve at an adequate pace.  This first edition of the Volans Flyer links out to a number of the experiments we are currently working on.  If you are interested in knowing more, please get in touch.  We are only just starting—and we could use all the help we can get!

John Elkington

@volanssam:Becoming China - Great Learning or Apocalyptic Risk, launch, Nov 8th by the force that is JM Gescher @tianxiaq tinyurl.com/y7yqv69v
@VolansRich:What's Your Lifeboat? Why You Need A Sustainability Backup Business. @GreenSolitaire in @Forbes #ProjectBreakthrough forbes.com/sites/solitair…

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