Regenerative Capitalism: Reinventing the Economic Wheel

Capitalism is broken.

The traditional notions of a capitalistic global economy are skewed– the proof is in the stark inequality, impacts of climate change, and raging beliefs that ‘more is better’. The planet, the very basis of civilization, is being plundered and destroyed for profit and profit alone. We are hurtling towards extinction, the sixth of its kind (1).

In the face of global pandemics and the fragility of current economic systems in the wake of uncontrollable forces, thought leaders and policymakers are increasingly questioning the dominant form of capitalism in the 21st century.

These questions are worth asking, now more than ever:

● Does exponential, unfettered growth really lead to long-term prosperity?

● Why isn’t capitalism, often hailed as the ‘be all and end all’, not solving the world’s biggest problems?

● Why is it that the socialism-capitalism contrast hasn’t given us the answer to one of our most burning questions– how do we live sustainably?

As a consequence of these questions and to reimagine capitalism through a holistic lens, theories of regenerative capitalism have come into play over time. Despite being in its considerably emerging stages, regenerative capitalism is revolutionary in that it warrants a complete 180 in our views of economic systems.

What is Regenerative Capitalism?

The bottom line of regenerative capitalism is a single core idea– that the processes the universe uses to maintain healthy and sustainable ecological systems in the natural world can be used as a model for economic system design. More accurately, they must be used.

The main difference between regenerative capitalism and capitalism is that the latter’s bottom line is to pursue short-term profits by acquiring and depleting. The former’s is to promote healthy inter-systems and give back rather than take and take some more.

Quite simply, regenerative capitalism is seeing the forest where capitalism sees only individual, profitable trees.

What Regenerative Capitalism Calls into Question?

Here are some key concepts revisited by regenerative capitalism:

Sustainability as an outcome, not a solution

Regenerative capitalism does not offer solutions. There is no one sustainability strategy solution to systemic inequalities. Instead, it warrants reimagining and reinventing the wheel such that sustainability becomes a guaranteed outcome. If the system is flawed, single solutions are only plaster over the cracks. If the entire system is healthy, whatever comes of it will be holistic, too.

Finding common ground between polarized objectives

For years now, capitalism and socialism have been pitted as opposites. Political philosophies are sharply left or right; higher GDP means longer prosperity and vice versa. In reality, there are so many grey areas that affect long term success; swearing by polar opposites seems naive and narrow-minded. By contrast, regenerative capitalism looks at multiple scales and players. It understands that long-term wealth– not just the paper or plastic kind — is the sum of all the sides’ good ideals.

The environment as an equal player, not a passive resource

By far the most distinctive difference between regenerative capitalism and capitalism is the role of the environment. Regenerative capitalism looks at the environment– social, cultural, ecological — as very much influential on larger economic systems. Changes in any of these environments can sway long-term outcomes; one is not independent of the other.

The Principles of Regenerative Capitalism

Systemic health and regenerative capitalism are founded upon the following principles, proposed by John Fullerton of the Capital Institute (2):

  1. An interconnected web of life

There is no distinction between ‘us’ and ‘it’. The human economy is embedded in the larger biosphere; any damage to the larger web sends disastrous ripples back to humanity.

2. A holistic view of wealth

Wealth isn’t cash and cards alone– it’s social, cultural, economic, ecological, historical, and experiential capital. By picking and choosing our definitions of wealth, we lose sight of the larger picture, which spells short-term luck and long-term doom.

3. Empowered participation

The whole is greater than the sum of its parts; the active participation of every element powers the health of the whole. Each unique contribution spells a better future than those operating in isolation ever can.

4. Community and place

In regenerative capitalism, the history, culture, and settlements of the human race are nurtured and prioritized. Humanity isn’t static; humanity-driven systems shouldn’t be, either.

5. Creativity at the edge

Regenerative capitalism holds that creativity is always at the edge of the mainstream. Those edges that innovate despite the larger consensus are the places where transformation happens.

6. Balance for systemic health

Regenerative systems depend on delicate balance; a step either way could take us right back to where we started. The regenerative economic system calls for a middle ground everywhere, be it between nature and technology or present and future.

The Future is Regenerative Capitalism

Corrections to the current system have so far fallen short or failed outright because they do not address the root cause– a global economy whose motto is ‘take, make, waste’. While turning the entire world to regenerative capitalism is well-considered radical, anything less than that is ultimately futile.

However, it’s not all doomsday predictions. A few faces are turned towards the sun, albeit timidly. Several sustainable companies have already begun aligning their ethos and services with some, if not all, principles of regenerative capitalism.

EcoMatcher is one such business that holds several regenerative principles close to its heart. The bottom line of the tree planting business focuses on community, stakeholders, and environment holistically. The company also finds the perfect middle ground between nature and technology– often thought to be polar opposites. EcoMatcher engages with and mobilizes small communities around the world through tree planting; as the veritable middleman, EcoMatcher helps businesses reinvent their sustainability strategy and align themselves better with holistic goals.

If the world is to challenge the crescendo of natural and economic crises, the foundations of capitalism in the 21st century must be collectively called into question. Regenerative capitalism is the way to do it.

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Bas Fransen, CEO EcoMatcher

EcoMatcher connects companies, communities, and consumers through trustworthy and transparent tree-planting.