Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

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Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist Page 22

by Kate Raworth


  That’s why the next-step response has become the most common: do what pays, by adopting eco-efficiency measures that cut costs, or boost the brand. Cutting greenhouse gas emissions and reducing industrial water use are classic efficiency measures that tend to boost company profits in the process, especially in the early stages. That said, some companies evidently believe it pays more to deceive: Volkswagen gained notoriety in 2015 when it was caught fitting millions of its diesel cars with ‘defeat device’ software that switched their engines into a low-emissions mode during tests, so significantly under-reporting their nitrogen oxide and carbon dioxide emissions.16 Others pursue the credentials of ‘green’ product branding that appeals to consumers willing to pay a premium for eco-friendly products. Motivated by this kind of green positioning, such companies benchmark their progress against industry competitors: it’s a start, yes, but the most that it demonstrates is that ‘we are doing more than our competitors’ or ‘we are doing more than we did last year’. And that is very likely to be a long way off what’s needed.

  The third response – getting more serious now – is to do our fair share in making the switch to sustainability. To their credit, companies taking this approach at least start by acknowledging the scale of change needed based on, say, the total reduction in greenhouse gas emissions, fertiliser use, or water withdrawals that is recommended by Earth-system scientists or required by national policy targets. One well-intended example comes from South Africa’s Nedbank, which in 2014 committed to channel its ‘fair share’ of commercial financing – equivalent to $400 million per year – into investments that promote the nation’s goals for 2030, such as affordable, low-carbon energy services, and sustainable clean water and sanitation for all. ‘Fairshare 2030 is money working for the future we want,’ says the bank’s chief executive.17 True, but it still begs the question of what the rest of the bank’s money is doing. Furthermore, as anyone knows who has ever been left holding the restaurant bill once their fellow diners have chipped in with what they think is their fair share, it almost never adds up. Self-determined fair shares never quite get the job done – as the world’s governments have demonstrated with their woefully inadequate, nationally-determined pledges to cut their greenhouse gas emissions.

  More worryingly, ‘doing our fair share’ can too easily slip into ‘taking our fair share’. On first encountering the Doughnut, many businesses seem to look upon its outer ring of planetary boundaries as if it were a cake to be sliced up and handed out. And, like all kids at a birthday party, they want their fair share. Still trapped in the mindset of degenerative, linear industry, the first question that many ask is: how big a slice of that ecological cake is ours? How many tonnes of carbon dioxide can we emit? How much groundwater can we withdraw? The answer is likely to be far less than they currently do, so it certainly raises the bar of ambition. But ‘taking your fair share’ reinforces the view that the ‘right to pollute’ is a resource worth competing for. And when competing over limited resources, we humans too easily start to jostle for space, lobbying policymakers and gaming the system, significantly raising the risk of transgressing the boundaries in the process.

  The fourth response – and it is a true step-change in outlook – is to do no harm, an ambition that is also known as ‘mission zero’: designing products, services, buildings and businesses that aim for zero environmental impact. Examples aspiring to that goal include ‘zero-energy’ buildings like the Bullitt Center in Seattle which (despite that city’s reputation for relentless rain) uses solar panels to generate as much energy as it uses each year. Net-zero-water factories likewise make no net withdrawals from public water supplies, such as Nestlé’s dairy plant in Jalisco, Mexico, which meets all its industrial water needs by condensing the steam evaporated from the cows’ milk, instead of continually extracting fresh water from the region’s severely stressed groundwater reservoirs.18

  Aiming for net-zero impact is a truly impressive departure from the business-as-usual of degenerative industrial design, and it is more impressive still if the aim is net zero not just in energy or water but in all resource-related aspects of a company’s operation – a still far-off goal. It is also a sign of profound efficiency in resource use but, as the architect and designer William McDonough has put it, the avid pursuit of resource efficiency is simply not enough. ‘Being less bad is not being good,’ he says. ‘It is being bad, just less so.’19 And, once you think about it, pursuing mission zero is an odd vision for an industrial revolution, as if intentionally stopping on the threshold of something far more transformative. After all, if your factory can produce as much energy and clean water as it uses, why not see if it could produce more? If you can eliminate all toxic materials from your production process, why not introduce health-enhancing ones in their place? Instead of aiming merely to ‘do less bad’, industrial design can aim to ‘do more good’ by continually replenishing, rather than more slowly depleting, the living world. Why simply take nothing when you could also give something?

  That’s the essence of the fifth business response: be generous by creating an enterprise that is regenerative by design, giving back to the living systems of which we are a part. More than an action on a to-do checklist, it is a way of being in the world that embraces biosphere stewardship and recognises that we have a responsibility to leave the living world in a better state than we found it.20 It calls for creating enterprises whose core business helps to reconnect nature’s cycles, and that gift as much as they can – because only generous design can bring us back below the Doughnut’s ecological ceiling. For Janine Benyus, a leading thinker and doer in the field of biomimicry, this notion of generosity has become the design mission of a lifetime. As she told me,

  We are big-brained animals, but we are newcomers on this planet, so we are still acting like toddlers expecting Mother Nature to clean up after us. I want us to take on this design task and become full participants in every one of nature’s cycles. Start with the carbon cycle – let’s learn to halt our industrial ‘exhale’ of carbon pollution, and then, by mimicking plants, learn to ‘inhale’ carbon dioxide into our products and store it for centuries in rich agricultural soils. Once we’ve cut our teeth on the carbon cycle, let’s apply what we have learned to the phosphorus, nitrogen, and water cycles, too.

  To discover the essence of generous design, she suggests that we take nature as our model, measure and mentor. With nature as model, we can study and mimic life’s cyclical processes of take and give, death and renewal, in which one creature’s waste becomes another’s food. As measure, nature sets the ecological standard by which to judge the sustainability of our own innovations: do they measure up and fit in by participating in natural cycles? And with nature as mentor, we ask not what we can extract, but what we can learn from its 3.8 billion years of experimentation.21

  Each tick-box on the Corporate To Do List could be seen as a stage on the path to regenerative design: for individual companies, what matters as much as where you are now is where you are heading. But there is no need (nor indeed time) to make that value shift step by step: far more inspired is to transform – like a caterpillar into a butterfly – into generous design.

  Which one is your business aiming to do?

  The circular economy takes flight

  Industrial manufacturing has begun the metamorphosis from degenerative to regenerative design through what has come to be known as the ‘circular economy’. It is regenerative by design because it harnesses the endless inflow of the sun’s energy to continually transform materials into useful products and services.22 So bid farewell to the linear industrial economy’s caterpillar as, before your eyes, it turns into a butterfly, in a diagram based on one created by the Ellen MacArthur Foundation.23 And, just as with real butterflies, the brilliance lies in the wings.

  What are the design features that enable this industrial butterfly to take flight? First, focus in on the old cradle-to-grave mentality of the linear economy that incited the twentieth c
entury’s voracious mining for minerals, drilling for oil, and burning of waste. That caterpillar, the throwaway economy of take-make-use-lose, still flows from top to bottom through the centre of the diagram. But watch as it turns into a butterfly thanks to cradle-to-cradle thinking in the circular economy.24 It runs on renewable energy – from solar, wind, wave, biomass and geothermal sources – eliminating all toxic chemicals and, crucially, eradicating waste by design. It does so by recognising that ‘waste equals food’: instead of heading for landfill, the leftovers from one production process – be they food scraps or scrap metal – become the source materials for the next. The key to making this work is to think of all materials as belonging to one of two nutrient cycles: biological nutrients such as soil, plants and animals, and technical nutrients such as plastics, synthetics and metals. The two cycles become the butterfly’s two wings, in which materials are never ‘used up’ and thrown away but are used again and again and again through cycles of reuse and renewal.

  The butterfly economy: regenerative by design.

  On the biological wing, all nutrients are eventually consumed and regenerated through the living earth. The key to using them endlessly is to: ensure that they are harvested no faster than nature regenerates them; harness their many sources of value as they cascade through the cycles of life; and design production in ways that gift back to nature. Take coffee beans as a simple example: less than one per cent of every bean ends up in a cup of coffee and the leftover coffee grounds are rich in cellulose, lignin, nitrogen, and sugars. It would be foolish to throw such organic treasure straight on to a compost heap or, far worse, into a rubbish bin, but this happens in homes, offices and coffee shops worldwide. Coffee grounds, it turns out, make an ideal medium for growing mushrooms, and then can be used as feed for cattle, chickens and pigs, and so are returned to the soil as manure. From the humble coffee bean, imagine scaling that principle up to all food, crops and timber, and scaling it out to every home, farm, firm and institution: it would start to transform our last-century forestry and food industries into regenerative ones that reap value from and then regenerate the living systems on which they depend.

  On the butterfly’s other wing, in contrast, products made using technical nutrients such as metals and synthetic fibres do not naturally decompose so they must be designed to be restored – through repair, reuse, refurbishment, and (as a last resort) recycling. Take mobile phones, for example, which are chock-full of gold, silver, cobalt, and rare earth metals, but are typically used for just two years. In the European Union, over 160 million mobile phones are sold annually, but in 2010 only 6% of used phones were being reused, and 9% disassembled for recycling: the remaining 85% ended up in landfill or lay defunct in the back of some drawer.25 In a circular economy they would be designed for easy collection and disassembly, leading to their refurbishment and resale, or the reuse of all their parts. Scale those principles across all industries and you start to turn twentieth-century industrial waste into twenty-first-century manufacturing food.

  It’s inspired stuff, but don’t get carried away on the butterfly’s wings because the notion of a truly circular economy belongs with the fantasy of perpetual motion machines: a more accurate name would be the cyclical economy. No industrial loop can recapture and reuse 100% of its materials: Japan impressively recycles 98% of metal used domestically, but there’s still an elusive 2% leaking from that loop. And given enough time, all technical materials – from metals to plastics – will start to rust or decay. But if we start to look upon every object, be it an eighteenth-century building or the latest smartphone, as if it were a battery storing valuable materials and energy, then we begin to focus on retaining or reinventing that stored value. And since we have the extraordinary luck of being bathed in a constant river of solar energy, we can – like all living things – be ingenious in harnessing that real-time energy to restore what we have created, and to regenerate the living world in which we thrive.

  In a degenerative industrial economy, value is monetary and it is created by searching for ever-lower costs and ever-greater product sales: the typical result has been intense material throughflow. In a regenerative economy, that material throughflow is transformed into round-flow. But the real transformation comes from a new understanding of value. ‘There is no wealth but life,’ as John Ruskin wrote in 1860. His words were poetic but they were prophetic too. Economic value lies not in the throughflow of products and services but in the wealth that is their recurring source. That includes the wealth embodied in human-made assets (from tractors to houses) but also the wealth embodied in people (from their individual skills to community trust), in a thriving biosphere (from the forest floor to the ocean floor), and in knowledge (from Wikipedia to the human genome). Yet even these forms of wealth eventually dissipate: tractors rust; trees decompose; people die; ideas are forgotten. Only one form of wealth persists through time and that is the regenerative power of life, powered by the sun. Ruskin was evidently a regenerative pioneer.

  Welcome to the generous city

  Factories and industries can be regenerative by design and so too can urban landscapes. Janine Benyus is bringing to life her vision to create what she calls ‘generous cities’: human settlements that nestle within the living world. As a first step in the process, she starts by observing a city’s local native ecosystem – such as the nearby forest, wetland or savannah – and records the rate at which it harvests solar energy, sequesters carbon, stores rainwater, fertilises soil, purifies the air, and more. These metrics are then adopted as the new city standard, challenging and inspiring its architects and planners to create buildings and landscapes that are ‘as generous as the wildland next door’. Rooftops that grow food, gather the sun’s energy, and welcome wildlife. Pavements that absorb storm water then slowly release it into aquifers. Buildings that sequester carbon dioxide, cleanse the air, treat their own wastewater, and turn sewage back into rich soil nutrients. All connected in an infrastructural web that is woven through with wildlife corridors and urban agriculture.26 Such design possibilities arise out of regenerative, not degenerative, questions. ‘Don’t ask: what’s my fair share to take?’ Benyus explains. ‘Ask: what other benefits can we layer into this so we can give some away?’27

  Imagine if such a regenerative city were also distributive by design. Renewable energy microgrids would turn every household into an energy provider. Affordable housing connected by dedicated public transport routes would make the cheapest form of travel the fastest. Neighbourhood enterprise hubs would allow parents to be parents again by bringing the workplace and home closer together for women and men alike. And given that its life-regenerating infrastructure would be ‘high-touch’, as Benyus calls it, it would need people to continually tend, steward and maintain its regenerative capacity, so creating purposeful, skilful jobs in the process.

  No such city can yet be found on a map of the world, but there are enterprises and projects aiming to put its design principles into practice across continents. In the Netherlands, Park 20|20 is a business park designed on ‘cradle to cradle’ principles, constructed with recyclable materials, an integrated energy system, a water treatment facility, and roofs that collect solar energy, store and filter water, block heat, and provide wildlife habitats.28 In California, the company Newlight Technologies is capturing methane emissions from dairy cows, turning them into bioplastic and making products – such as bottles and office chairs – which have been independently verified as carbon-negative, sequestering greenhouse gas emissions across their entire life cycle.29 In the arid coastal lands of South Australia, Sundrop Farms is using seawater and sunlight to grow tomatoes and capsicums. Its state-of-the-art greenhouses harness solar energy to desalinate the saltwater, create heat, and generate electricity, all used to grow the crops. ‘We’re not just addressing an energy issue or a water issue,’ says Philipp Saumweder, Sundrop’s CEO, ‘we are addressing both of those together to produce food from abundant resources, and to do that in a sustainab
le way.’30

  How can a city be as generous as a forest?

  Villages, towns and cities in low- and middle-income countries are embracing regenerative design principles too. Bangladesh aims to become the first solar-powered nation and is training thousands of women as solar engineers who can install, maintain and repair renewable energy systems in their own villages.31 In Tigray, Ethiopia, over 220,000 hectares of desertified land have – astonishingly – been regenerated since 2000 thanks to farming communities that have built terraces and planted bushes and trees. They have restored once-barren hillsides to lush valleys that provide grain, vegetables and fruit for the surrounding villages and cities, while sequestering carbon, storing water, and rebuilding the soil.32 In Kenya, social enterprises such as Sanergy are building hygienic toilets in slum districts and turning 100% of the human waste they collect into biogas and organic fertiliser for sale to local farms – improving human health and creating much-needed jobs while cutting nitrogen pollution and increasing soil fertility.33 Likewise in Brazil, the start-up enterprise ProComposto collects organic waste from city restaurants, apartment blocks and supermarkets, turning it into fertiliser for organic farming. By saving biological materials from the landfill, the company is cutting methane emissions, enriching the soil with carbon instead, and creating jobs.34

 

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