ENVS 5150 Corporate Sector Strategies

The Green Economy A Historical Transition: …from Quantity to Quality A Question of Potentials …not simply limits Key to Sustainability: Redefining Wealth

Quantitative: Money & Material Accumulation Qualitative: Well-being Regeneration

Industrialism: The Divided Economy Invisible Visible Use-value Exchange-value Consumption Production People Things Unpaid Paid Women Men Informal Formal Private Public

Invisible Economy (1) Total Productive System of an Industrial Society (layer cake with icing) GNP-Monetized ½ of Cake Top two layers Non-Monetized Productive ½ of Cake Lower two layers GNP Private Sector Rests on GNP Public Sector Rests on Social Cooperative Love Economy Rests on Natures Layer Private Sector PublicSector underground economy Love Economy Mother Nature All rights reserved.Copyright© 1982 Hazel Henderson 2

Basics of a Green Economy 1.The Service Economy Hot Showers and Cold Beer Nutrition, Illumination, Entertainment, Access, Shelter, Community, etc. 2. The Lake Economy Flowing with nature, Every output an input, Closed-loop organization, Let nature do the work

Structural obstacles to sustainability Nature of the Corporation & the SBL Centrality of Economic Growth Ownership patterns inconsistent with Stewardship Alienated relationship to human need: Creating, rather than responding to, it Note: all the above create or externalize social-/enviro- costs

The Business Case for Sustainability Single Bottom Line Sustainability (SBLS) Essential to large corporations Not sufficient to create ecological economies Corporations need outside help!

Quantification & Value What is measured gets done What gets counted is valued; What is valued gets counted

Indicators [If it is to be achieved, the new economic system] will result from our becoming better ecological accountants at the community level. If we must as a future necessity recycle essentially all materials and run on sunlight, then our future will depend on accounting as the most important and interesting discipline. Wes Jackson, Becoming Native to This Place

A Dashboard for the Cockpit The Family of indicators: –Urban Metabolism or regional mass balance –Green GDP (e.g. Genuine Progress IndicatorGPI ) –Ecological Footprint –Carbon accounting / carbon footprint –Life-cycle Assessment (products, processes, landscapes) –Industry-based accounts: food, building, forestry, etc. –ISO –Local Development Standards –5 capitals: personal, professional, spiritual, environmental and financial –Firm sustainability accounting –Sustainable Community Indicators –Risk Assessment, EIA, etc.

The Corporation in History initial charters the Corporate Person & industrialization Bureaucracy: the rise of Big Organization Fordism: Mass production & the crisis of effective demand –postwar Waste Economy Post-Fordism: commanding heights shift from manufacturing to finance and retail, globalization & outsourcing

The Corporation Today: In Crisis or Transition? End of the Era of the Big Organization & rise of distributed production, communication & regulation From Mass Production to End-use, from GM to Wal-Mart From Material to Phantom wealth, from Manufacturing to Wall St. Automation of white-collar work Radical drop in transaction costs outside the firm. –non-market alternatives Vulnerability and brittleness of the Transnational form: Peak Oil, EPR, social, health, political crises Sharing as the basis for new forms of efficiency & organization.

General Priorities labour vs. resource intensity --beyond cog-labour; upgrading work (human capital) qualitative indicators of wealth and progress --corporate accounting / community indicators place-based production & development economic democracy: workers, community, society organizational change: structure & culture that infuses all operations with sustainability goals & practices. transparency: de-monopolizing information restructuring of manufacturing: means/ends marketing: affects all aspects of the firm

Market Transformation Social & Environmental Values become drivers of mindful markets Money & capital increasingly a means (not the end-goal) of economic development Involves the transformation of regulation incentives & disincentives built into everyday economic life

Distributed Regulation Need for incentives & disincentives embedded in everyday production & exchange. 3 rd Party certification systems as non-state regulation. Finance & taxation as regulation Power of collective consumerism B-Corp: certification of corporate governance: changing corporate DNA Ownership tailored to stewardship and democracy.

Scarcity, Class Power & Waste War production, suburbanization and effective demand. Waste of resources Waste of human potential

Propping Up Effective Demand in North America after WW II The Waste Economy: suburbanization, permanent war economy. The artificial reproduction of scarcity. The Effluent Society. The Paper Economy: planned inflation and the establishment of the debt-based economy. The economic treadmill.

The Post WW II Waste Economy Permanent War Economy The Suburb Economy: Oil / Autos / Subdivisions Note gender and racial subtext of sprawl

The greatest misallocation of resources in human history. …James Howard Kunstler

Fordism & the Reinforcement of Industrial Wealth Matter Waste Fordism Suburbanization/ Consumer Economy War Industry Money Debt Keynesianism Paper Economy Planned Inflation New forms of credit- money

Post-Fordist Casino Economy (post 1980) new technologies & Megabyte Money financialization of economy: sector times (?) larger than the material economy Speculation: Stomp the weak / Get rich quick Empty wealth creation: de facto redistribution of wealth from poor to rich. The End of Mass Consumption & rise of new producer services: new forms of effective demand. Polarization of work and society –end of social contracts: attack on Welfare State –McJobs: from GM to Wal-Mart –The Great Risk Shift: more economic insecurity for almost everyone.

Source: Magdoff, 2008: calculated from tables L.1 and L.2; Flow of Funds Accounts of the US; and table B- 78 from the 2006 Economic Report of the President

The Global Casino: Hijacking the Information Revolution expansion of employment in speculative industry –Wall St.: more advanced technologically than the military. Bubble Economies: last frontiers for capitalist growth. -stock crash of tech stock bubble of late 90s -housing bubble of Housing speculation: most destructive & exploitative of the poor & average people.

Internal & External Action The balance is different for big & small business Relationship between democracy & economic evolution Centrality of Stakeholder relationships Importance of New Enterprise Networks