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Anchor 5

Create the Future-Fit Commerce System

Updated: Aug 9, 2021

Going from Unsustainable to Regenerative

Hear the the siren-alert; who is being called? young people doing startups, e- commerce or going into a company, Company Green teams, established employees and middle-management, C-level executives, CEOs, NGOs and consumers (everybody, huh?).

We all need to be aware of the life cycle of the products that we are selling, promoting or using, including materials, production, transportation, consumption and end-of-life. They are impacting Mother Earth, all ecosystems, creatures, food systems, inequality, social justice and people’s resort to violence. We all need to quickly implement the collaborative relationships needed to help redirect our destructive system of commerce. This decade, we face as never before, a mandate to reverse the impacts of the way we live, transforming from consumption and pollution to renewable energy and regeneration of ecosystems.

Context --

The Post "New Challenges..." summarizes the externalities of production that we have pumped into the atmosphere in growing quantities, polluting ecosystems and causing global warming. Despite hundreds of companies reducing greenhouse gas (GHG) per unit of production, (following a revered policy of continuous improvement) the acceleration continues. The Post, "Hoax of the Free-Market," discloses how the marketplace without regulation has no conscience for what is commodified (including humans) or how goods and opportunities are equitably distributed. Subsequently, despite the increased conscientiousness evidenced in Corporate Social Responsibility (CSR) reporting, inequalities and the mindless, non--prioritized selling off of habitat and resources, continues to accelerate, while the lions' excess share of profits generated rises to the top.

Ceres’s, the eminently capable nonprofit focused on sustainability, has projected the cumulative consequences of these exponentially accelerating trends as they will grow by 2030, unless we reverse course. (See the following chart.) The problems that challenge us need to be addressed from a systems perspective because they all affect one another and directly or indirectly each of us.

"Environmental and social crises are not only imminent, they are intricately interconnected. As ecosystems degrade, people are forced to make difficult and, in some cases, impossible decisions. As people are mistreated and denied the resources to thrive, survival outweighs environmental stewardship. Failure to address one issue exacerbates the risk of another. However, the actions taken to catalyze positive change, to change the system and resolve fallibilities can have

effects that amplify well beyond the action itself." (Ceres roadmap to 2030)

Worldwide, thousands of companies have responded to the business case for sustainable practices. It makes common sense that money will be saved through the reduction of waste, reduction of energy use, the reduction of water and engagements with employees and communities that increase morale. Also risks are reduced from volatile supply prices and utility management. But, if the increase in sustainable business practices is not solving our planetary problems, then what?

Four aspects of motivation, if embraced, will enable us to effectively address the challenges of this decade to re-create our system of commerce. Businesses, in taking these extra steps, will not lose the profitability advantage they have gained when practicing sustainability. Innovative actions, such as are needed, create jobs and opportunities, not diminishing them.

1) FEAR Fear transformed helps us to get in gear. We are much more apt to follow evacuation orders to leave our house, if we know it is on fire! The consequences of climate change are becoming more experiential and less something that we just read about. In the Post on communicating with climate change deniers, dissociative barriers were described.

We need to let those barriers become more permeable in ourselves.

2) Understanding marketplace realities

) Usual understanding of the economy in relationship to the environment must be reversed. For centuries we have relied upon the environment as a bottomless repository into which market externalities (not priced in transactions): waste, garbage, emissionss, and more recently plastic etc. can be dumped. No more, the ocean is almost saturated with carbon dioxide and can no longer be a sink for storing greenhouse gas. The ocean is also getting filled with phosphate and plastic. We are losing access to the amount of undegraded soil needed to feed our growing populations. Climate warming, fueled by our GHG emissions, is changing our planetary systems. We must learn that businesses, the economy, and society are wholly-owned subsidiaries of nature. Mother nature is not the servant of the market. Or, as the more compelling metaphors of Native American poetry tell us, we are the arms and legs of Mother Earth, not She, our maid-servant.

B) One planet

We must learn that nothing goes away: waste from all economic transactions in the world going to the environment ls still with us. We are one planet.

C) The economic boomerang

The climate driven catastrophes

which we experience and that

we read about in the news,

are bounced back from what

we have sought to empty into the


3) A third aspect of turning around the impact of commerce is for businesses to measure their progress by starting with science-based goals

placed in the future, and then casting milestones back toward the present.

Up until now, businesses have benchmarked their progress by measuring how far they have improved from last year. Problem is that such improvements may slow down the harm that commerce is doing to society and the environment but not reversing course from speeding ahead toward the precipice. Continuous progress sounds good, but as the saying goes, it makes no difference if we go over the precipice at 100 miles an hour or 50 miles an hour. Too little too late reminds me of the climate change summit held atop Mount Everest in the year 2040!

The following diagram graphically demonstrates this reversal in measurement technique that begins by starting with the future.

In the above chart, a performance goal is placed into a future "required state." Criteria setting standards for a future goal might come from the environment; or, might come from meeting conditions for social justice. Suppose, for example the challenge involves the use of water, either for community development, agriculture or for manufacturing. A goal to simply reduce the amount of water used would not be enough. Questions to be asked would include what is the carrying capacity of the water source? Of the aquifer? Of the river? And what are the expectations for natural water replacement within that source? These are the scientific questions but they are also collaborative and social. Who else is using the water? What kind of collaborative agreements are necessary to meet these required standards? This type of framework for inquiry before setting goals, is necessary not only for one's primary production or household, but also for the supply chain that supports indirect water use before products, food, etc., come into your primary domain. It is likely that about 75% of your environmental footprint, be it in water, GHG, or food, etc. will be ln your personal, business or community supply chain. Given the complexities of these types of calculations, many people who are endeavoring to responsibly meet the caring capacity requirements of Mother Earth, instead set the goal of net zero impact, and backcast, setting milestones that will move them in that direction. Reaching Net Zero might be accomplished through some combination of actions including use of renewable energy, collecting rainwater, reducing fossil fuel use, and cresting offsets through soil enrichment, planting trees, etc.

The final formulations of goals are not arbitrary or relative, but to the best of calculations are meeting future-fit requirements. Therefore in setting steps, milestones, moving towards its goals, motion is in a direction and not simply moving for motions sake. The adjoining chart presents the backcasting model. is an NGO that is building a community of companies who work collaboratively to build resources for the type of benchmarking and goalsetting that is described above. Members participate in upgrading measurement techniques, developing measurable Key Performance Indicators (KPI's) to improve everyone's performance. Oriented toward developing business leadership for global environmental and social justice, they have oriented much of their goalsetting effort forward United Nations sustainable development goals (SDG's).

In 2015, world leaders working through the UN, adopted an ambitious set of priorities that formed the groundwork for the SDGs, to build a better world by ending poverty, fighting inequality and injustice, and protecting the planet by 2030. The SDGs address the complexity, interconnectedness and systemic nature of our challenges, offering a common framework and language for corporations, governments, NGOs and other key stakeholders to move toward a shared vision for the future. The public and private sectors have taken steps toward achieving the SDGs, but more must be done, including greater allocation of capital, stronger policies, better governance and more ambitious and aggressive action.

Businesses c working together and collaborating with nations, cities and smaller communities in their supply chains are often better equipped than government organizations acting alone to achieve social justice objectives. They have organizational structures with decision-making operations that are less likely to be held up by competing factions. Thriving as companies also depends upon social and environmental support from their supply chains, giving a vested interest in this work. Effectiveness in this mission goes beyond formal goalsetting and includes the operating spirit that they bring to the localities in their supply chain. A less formal way of operating, for example, might include a decision that once the 16% of profit has been achieved (or whatever amount is deemed necessary to keep the business thriving) the remaining profits are invested into philanthropy within the communities that are part of their value chain.

In forthcoming Posts, I will highlight the way in which Interface Carpets, the world's largest commercial carpet company, has partnered with a Philippines fishing village to gather netting that is disrupting its fisheries and selling them to Interface to use in making carpets – a win-win situation. Also I will note How the City of Seattle has integrated development fees with the purchasing of development rights from agricultural land, preserving the land and making contributions to farmers' markets as part of a food system policy that also cuts down the environmental footprint of the supply chain that supports the city.

In this Post, I am happy to report the way in which Patagonia Orchards, a company founded by Philip Ostrom and Sherry Luna has on a weekly basis, during the Covid crisis, brought truckloads of fruit to the Navajo and Hopi reservations!

In addition to the world of commerce is filled with supportive organizations and companies seeking collaboration in the partners in this important journey of regenerative business traveling toward 2030. There are organizations for individuals such as International Sustainable Professionals (ISP), lobbying organizations seeking to promote regenerative commerce policies at the national level; e.g., American Sustainable Business Council (ASBC), many coalitions of companies in different sectors seeking to combine their efforts towards sustainability and regeneration of operations and products, etc. Nobody needs to or can alone do this journey task of turning around the way we do commerce!

If anyone has a question about helpful resources, write me a note, being a bit specific about your needs, and I will respond promptly.

Wishing empowerment to all, Karl

PS: I can't close without giving special thanks to Bob Willard. Bob is the eminent resource Center of sustainable business practices. Every quarter he sends out an updated deck of PowerPoint slides, to use as we choose, keeping all of his follower/colleagues up to date. Some of you have remarked about the picturesque nature of my posts, thank Bob and consider signing up for his newsletter, buying his books, etc. We have been sharing best practices in sustainable business for 20 years :-).

The beautiful nested systems diagrams that you often see in my posts are, of course, pulled from Bob’s resources.