This article was written by Pavan Sukhdev and published in Guardian
Sustainable Business Blog on January 4, 2013. Pavan is an environmental
economist and board member for Conservation International. He is also the
UN Environment Programme’s goodwill
ambassador. A former banker, he led the UNEP’s green economy initiative and is
author of a new book, Corporation 2020.
it a host of ecological, governmental and social issues but a new world is, and
has to be, possibleThey were right, the world has ended. The world as we knew it
came to an end more or less when the Mayan calendar ran out, on winter solstice,
The old world that died in 2012 had a stable climate, cheap commodities,
governments managing change, high growth in output and consumption, and
corporations driving economies and serving societies all deeply infused with a
blind belief in free markets.
The new world that begins now, in 2013, will be defined by frightening
climate instability, commodity and food prices ratcheting skywards, impotent
governments reduced to spectators in their own countries, continuing recession,
and corporations either being hounded as common criminals or laurelled as
champions of virtuous change. An internet-enabled anarchy of the wronged will
pull entire countries along unplanned roller-coaster rides through a Disneyland
world of commotion and crises. Briefly, here is why I think so.
Breaching the Limits of the World’s Ecosystems
Our world is rapidly approaching planetary boundaries – across climate, biodiversity,
nitrogen, phosphorous, ocean acidification, freshwater scarcity, inter alia.
Economies worldwide are still headed in the wrong direction – towards resource
exhaustion, social disparities, and persistent poverty. What we need is change
at the speed of light, driven by bold leaders. What we have is change at the
speed of change, hesitantly nudged by cautious governments. Too little, too
late, such prevarication will spill into natural disasters. We saw some as 2012
ended – we shall see more as the earth’s ecosystems do what all systems in
equilibrium try their best to do: stay in equilibrium, until they simply cannot.
Until what we call “resilience” is replaced by “thresholds” being breached,
planetary boundaries being crossed.
Breached thresholds will lead ecosystems into new states of equilibrium,
which may not be any good for human life, society, or economy.
The Vulnerable will Suffer Most
Increasing climate disruptions will cause higher price volatility in
agricommodities, due to crop failures and crop losses. The world is
over-invested in intensive agriculture, and due to a corresponding lack of
investment to improve yields and resilience for smallholder farming, the poor
will actually suffer the most from these supply disruptions and price
In the absence of political leadership, others will provide bold leadership,
such as corporations, who are the lion’s share of today’s economy, GDP and jobs.
Some have already shown real leadership in 2012, such as by measuring and disclosing their externalities (Puma), or lengthening
their investor and analyst horizons by stopping quarterly reports (Unilever). Many more will
follow these trendsetters in 2013.
An End to Crony Capitalism
At the same time, adherents of the old model of corporation – profit-fixated,
externality-churning, disconnected from social purpose – will find the going
tougher. Public patience with being exploited by the freedoms of freemarket
capitalism is running thin. Public outrage at investment banking excesses has
not died even four years after the global financial crisis. “Corporate
externalities” is no longer an obscure term hidden at the end of economics
textbooks, but a common phrase in news media.
Corporations that habitually free-lunched off global and national governance
weaknesses and cheap natural resources will realise that their free lunch is
nearly over; mainly because the “crony” governments of their crony-capitalist
alliances are either emaciated, or bankrupt, or cannot toe the line of corporate
profitability any longer in the face of scientific evidence and citizen
activism. Indeed, from the first Arab Spring uprising to a campaign of moral
outrage in Britain over corporate tax avoidance, which immediately yielded
millions from Starbucks, the internet-enabled anarchy of the wronged has become
the vehicle of successful change.
Many years ago, Arundhati Roy, author of The God of Small Things said:
“Another world is not only possible, she is on her way. On a quiet day, I can
hear her breathing.”
Winter solstice, 2012, was a quiet day. The earth’s magnetic field did not
flip. Planes did not fall out of the sky. A nuclear holocaust was not launched.
A giant meteorite did not slam into earth.
But if you had listened for a quieter strain, you would have heard her. A new
world had begun.
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