Green Swans: The Coming Boom in Regenerative Capitalism

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Fifth and finally, there is the phase of Regeneration. This is the phase where the entire system shifts from a linear resource-consuming system to an increasingly circular, regenerative system that can sustain over time without harming our planet, even restoring it. In the case of electric vehicles—as well as in virtually every other case—this phase has yet to be tried properly. What Can I Do? Is the idea compelling enough, even at small scale, for target users to act? If the idea were to be scaled, what would be different in the world? How can this inspire others? Dame Polly Courtice, Director of the University of Cambridge Institute for Sustainability Leadership (CISL). Also Founder Director of The Prince of Wales’s Business and Sustainability Programme, and Academic Director of the University’s Master of Studies in Sustainability Leadership. We need John Elkington’s optimism, and his insight, more than ever, and here he sets out a bracing and inspiring vision of the path we must take if we are to transform ourselves and secure the future for our planet. Green Swans is a welcome and well-researched manifesto and should be compulsory reading in every boardroom.”

Financial institutions need to start building forward-looking analyses using tools such as Climate Value at Risk—a quantitative model that measures climate-related risk in an investment portfolio—and by conducting stress tests like the French exercise.There’s is an optimism that comes from doing things," he said, "and one of the great privileges of your job and mine is we're meeting extraordinarily interesting people the whole time who are experimenting with new technologies and business models and regulations. I couldn't have wished to be born in a better time." We’ve removed a lot of the redundancies that would have given us the ability to ride out fundamental weaknesses in the way that we put together our economies and operate them," he said. "And if that's true of a pandemic, my God, it's even more true of the climate emergency that is pressing down on us increasingly and in so many different ways." If you do nothing, you will be auto-enrolled in our premium digital monthly subscription plan and retain complete access for 65 € per month.

What would he say to those tasked with leading through this crisis? “Get out more. When the roof is coming around your head the temptation is to stay chained to your desk. The future is out there and the future is incredibly exciting. It’s going to be quite challenging too, but my God it’s exciting! Go out and see some of the people who are helping to create it. Then see what you can do to play into that and support the inevitable transformation.” Rejection is followed by Responsibility, a phase where one or few leaders—corporate or governmental—start taking responsibility for the emergence of the Green Swan outcomes. Elon Musk’s decision to start Tesla, producing electric cars himself because no other car manufacturer would invest, is a good example.The development banks are absolutely foundational. I think they’re critical,” he continues. “In many ways the whole Bretton Woods structure to rebuild the post-World War Two economy was built around the development bank principle, and many of the early impact mindsets and methodologies were pioneered there. But the problem is that very often, individual development banks and international development institutions are doing their own things. The one thing I would love to see—although I don’t want a Vatican, with everyone suddenly under one roof—is a more globally coordinated effort. We do need integrated standards and I think DFIs have a crucial role to play in that, not simply in mobilising capital.” I have to admit, when I put in for Goodreads giveaway on this book, I was a little fearful of potentially receiving a tomb that would be difficult to read, and even more difficult to digest. The topic, however, intrigued me. I'm so happy I took the chance . . . and even more grateful that I won the giveaway. This book is AMAZING!. I’m 72 and I’ve been working at this for 50 years, but I think my career’s just starting. The next 10 to 15 years are going to be the most exciting, challenging and politically dangerous of my entire working life. We know what needs to be done and there is a sense of urgency building all around. Now really is our time. It really is now or never.” Three critical observations about how the global economy currently is failing us underpin the Future-Fit Foundation’s strategy:

This isn’t the first time Elkington has injected a new word into the sustainability community’s collective language. In 1994, he introduced the concept of the triple bottom line (and the following year, "people, planet, profit"). In 2018, 25 years after he first introduced the first idea, he distanced himself from it.Management for banks and asset managers recently announced by the Monetary Authority of Singapore (MAS) represents early steps by Cathy Runciman, Co-Founder, Atlas of the Future, and former Managing Director of Time Out International. Lise Kingo, CEO & Executive Director, United Nations Global Compact, the world’s biggest sustainable business platform.

They're character-forming, but we start to have to link up in very different ways," he said. "We have to break out of our sustainability reality bubble. That's beginning to happen fundamentally in the young people. It really keeps me moving forward. They think differently, and they're pretty optimistic. We can solve some of these problems, and they want to be part of that. It’s part of our role to help them do that." Green Swans, in contrast, are positive market developments once deemed highly unlikely—if not actually impossible. For most people, they also arrive more or less out of the blue. And they can have a profound positive impact across the “triple bottom line” of economic, social and environmental value creation. At their best, they are simultaneously environmentally restorative, socially just and economically inclusive. De Nederlandsche Bank recently examined the material exposures of Dutch financial institutions to risks stemming from biodiversity loss. According to its report, Dutch financial institutions have provided €510 billion in finance worldwide to companies that are highly dependent on ecosystem services, with €28 billion exposed to products that depend on pollination alone. De Nederlandsche Bank (2020), “ Indebted to nature – exploring biodiversity risks for the Dutch financial sector”, June. France’s banking regulator recently piloted the world’s first-ever climate risk stress exercise with nine banks and 15 insurers. It found that while risk exposure appears moderate, data gaps and uncertainty over the speed of climate change make it hard to reach firm conclusions. John Fullerton, Founder of Capital Institute, author of Regenerative Capitalism: How Universal Principles and Patterns Will Shape the New Economy, and former Managing Director of JPMorgan.

There's something about the operating environment into which we are now moving, which will turn lots of things exponential. The good stuff, the bad stuff and the ugly stuff. Professor Jørgen Randers, Professor Emeritus of Climate Strategy at the BI Norwegian Business School, and science-based activist since co-authoring The Limits to Growth in 1972. Has the idea already been proven (for example in a particular location), or can its financial and/or technical viability only be proven if it scales? See also NGFS and INSPIRE launch a joint research project on 'Biodiversity and Financial Stability', NGFS press release, 6 April 2021. The biggest mistake today’s leaders can make is to think of this system as an alternative to the one we currently have. Instead, our interconnected global economy requires it to be one and the same.