The Profitability of Sustainability

I often wonder, while we have the techonology, the money and the means to convert our miserable world into a sustainable world why are we unable to transit? What is taking us so long (since 1972 when the United Nations Conference on the Human Environment took place, since 1987 of the Bruntland Report and since 1992 of the Kyoto protocol)? Paul Hawkin has made a valiant attempt to understand what it would take for the world to reverse global warming i.e. to start sequestering the excess of carbon (GHG emissions) in the atmosphere so that we are back to safe levels. He edited a collosial effort of over 100 researchers and writers from across the world coming together for Drawdown. The book is awesome. It ranks the best solutions in decreasing order of their impact. It has some counterintuitive ranking which is worth pondering over. What makes the book special is that it is a first of its kind. A pioneering effort indeed!

But the book tells us a future under mutliple “What ifs”, what if all the girls get educated and could control their fertility rates leading to a more sustainable population. What if all the food that is wasted around the world was saved. What if the land use and land change was improved to sequester more carbon etc. etc. It has around 100 such solutions. The catch is this. We pretty much are aware that there exist solutions to our misery, but are unable to overcome our inability to implement these solutions. Probably the enabling environment is just not enabling enough. Now the question is of “How to” and not so much of “What if”. Let’s think about it!

There is one dominant principle on which most of the meta decision making happens. Profitability! For all of you who are unaware of what this means, profitability basically means that you should get more than what you spend – be it energy or money. If the profitability of action A is less than action B then there is a fair chance that majority would chose action B over A and this has been the dominant narrative for most part of our formal civilization.

There is perhaps nothing that stops us from moving to a truely sustainable and just world. And I am damn sure that it is definetely not our lack of understanding of the complexity of our real world. Yes, we still do not have a genuine intuitive understanding of real world complexity that can help us take systemic decisions, but I think we understand enough to be able to enable a transition process. Then what is it that is stopping us?

For many days (in between) I have often been lured into climate finance, green bonds, carbon credits and related discussions. And I mantained that I am just not interested. Simply because I believe these, in their current forms, are just distractions and not real solutions. Because the math is simple. If (and that is a big if) the profitability of climate/sustainability solutions is not more than the climate/sustainability problems then there is just not enough incentive for us to transit. Unless Solutions have a higher ROI than Problems, we are going to maintain a status quo or at best a deliberately slower transition (something that we are seeing now, which is ironically also considered transformative by some).

This theory is generically applicable. There may be brilliant examples of work where profitability or economics just did not matter, but they are far and few in between. Not enough to enable a macro transition. But the question is do we need to wait for it? Can micro, meso movements make a shift? I think yes they can. But I just dont know how much and how can I be a part of it. Because I am pretty much part of the problem economy more than the solution economy.

Now comes the game changer.

If we think that the solution economy has to have a higher profitability than the problem economy then we need to change the nature of economics. The purpose of money has to change when it comes to solution economy. It has to, has to enable a more sustainable behaviour of the masses.

I urge you all to read on the following topics and see if you find merit in my argument because after all my arguments are based on common sense and the available literature. So here is the list:

  • Localisation
  • Ecological Economics
  • Global Equillibrium
  • Limits to Growth
  • Local Currencies (community currencies)
  • Time Banking
  • Ecological Currencies
  • Degrowth
  • Steady State Economics

My Journey of Systems Thinking – VII

When is systems thinking not useful?

I have been asking myself this question very often, off late, because I think that thinking in systems has not always helped me take actions. But this is not a short coming of the subject but rather a personality trait associated with me. However, I think that one has to be aware of this trap of “inaction” in name of believing that the “system” is the problem. I will try to elaborate a bit.

For most time of the past ten years I have been thinking of real world systemic solutions and the top three things that come to my mind are: Local Economics (having local currencies), Self Sustaining Energy and Ecosystems Based Adaptation. If someone asks me what is the solution to all the environmental and economic problems we are facing today, I would simply go back to these three solutions (using different vocabulary). However, if they probe me further on how they could take small actions in their daily life to contribute to environment or sustainability, I am often at loss of words or ideas. Quickly I fall back to the regular options – use LEDs, shift to 5 star rated appliances, use efficient flush (in bathroom), segregate waste etc. But deep down these are not the things that I would consider as real solutions part of my daily life, if other meta things remained constant as they are today i.e. the problem of money and economics, un-sustainability of alternate energy systems, poor governance of fresh water etc.

So I conveniently let go all my efforts to practice some basic things in my daily life, like listed above. This does not mean that I don’t think they contribute to change but then I think that the system is the problem and unless we start developing or redefining systems, all our small efforts are not going to produce the big change that we wish to see in this world. This is a kind of “systems” trap. Where our desire to see big changes drives inaction towards small steps that one could take. As systems thinkers we have to be careful and mindful that we have to work at all levels simultaneously i.e. we have to sometimes apply the quick fix (change lights), work with people to help them see the patterns (how air pollution has become a recurring problem), evaluate the policy/governance structures that are causing the recurrence of these patterns even while personal awareness is going up (long distance travel is a must considering the cities becoming metro towns, farmer’s inability to recycle the agriculture waste back into the soil because the market turnaround time for agriculture produce is shorter these days etc.), also then reflect on the mental models/beliefs of people, that give rise to such structures (market, economy etc.) i.e. why people think the way they think, what are their untested assumptions, and then finally become aware that it is the shared vision of the society in which we are born and most of our mental models emerges from this societal vision (eg. growth is prosperity).

As systems thinkers we should not be choosy on what are the things that we would want to work upon. Say only public policy or teaching or awareness generation etc. We cannot get into the trap of exclusion while wanting to create a change at a system level.

I am facing this difficulty of trying to focus while also being alive to all the changes happening around me and how I could be a part of it. If I am not then I am being very non systemic in my approach.

Learnings from Implementing Social Change Projects

https://www.thelancet.com/pdfs/journals/langlo/PIIS2214-109X(18)30199-2.pdf

Mr. Arun Maira once had shared the above article by Dr. Jeffrey Sachs on his personal experiences as the Director of the Millennium Villages Project (MVP). In response I shared some of my learnings which resonated with the article. These are based on my experience while working at WOTR from 2009 to 2014 on the climate change adaptation project in 25 core villages which then expanded to 50+. The scale, diversity and integration of sectors of that project were very similar to MVP. After re-reading the mail today I thought of putting it here since I think it captured some of the key elements that could have generic applicability for social change projects. Hope you enjoy reading it.

——

Dr. Sachs says, ” Third, as an island of relative prosperity in the midst of poverty, the MVP’s resources inevitably were shared beyond the MVs to the neighbouring areas, thus diminishing the spending per person and impact within the MVs.”… this is consistent with my findings when we estimated the local to local money flows in project villages and tried to assign a local multiplier. None of the villages managed to spend even 10% of the total income locally throughout. This meant all the project money and work done created an endogenous rippling effect of at max 10% after the project activities. Thus, creating an ecosystem of local to local exchanges and strengthening the local spending is key for creating higher impact of projects. I have over half a dozen case studies from Maharashtra and one from Meghalaya on this.

Later he says, ” It used to be supposed that complex, multisector projects might be too hard to implement. We found that this was not the case: there were not only synergies in outcomes, but also important synergies in implementation across sectors.”… I remember Sushil Bajpai (then Director at WOTR and my systems thinking professor at SCMLD) use to tell us that while on field please look through an interdisciplinary lens and don’ t constraint your vision by your expertise or departmental lens. That was very helpful. I don’t think that the project’s complexity, due to over 10 verticals, was a challenge for implementation. It was our inability to cut through the department/disciplinary silos and leverage the inter-dependencies between our work eg. how solar pumps were linked to water budgeting and livelihoods and gender.

While I am being critical let me also say that the project team’s aha moments started coming when the project was nearing its end. This was the most painful. Dr. Sachs says, “… but by 2007 the MVP leadership team realised that the communities would need the full 10 years to 2015 to achieve the MDGs.”… this was true for us too. We were only beginning to get the beat of the system by the time the project was over. I distantly remember the implementation team and even the villagers beginning to see each other’s perspective by the time we were suppose to wind up the project. And it is also true that the follow on funding for extension was equally poor as in the case of MVP. I suspect one of the reasons was that it was very hard to show measurable outcomes from the first phase. Thus, I like what Dr. Sachs says, ” Fortunately, the project was not based on testing the effects of a specific and fixed set of interventions. It was instead based on reaching a specific set of targets”…. If one binds the project through a log frame then we are predicting the impacts of interventions (through the proposal) and then committing to test it through implementation. This could be disastrous.

Many Policies, One Reality – Overshoot and Fall!

Is there a way to sustain growth? Many people would say yes, let’s go green… lets become more efficient, improve technology… Well, read the paper and we can have a discussion on it!

http://www.teriin.org/policybrief/files/aug15/

In this paper we test three key policies which are very popular in the global agenda for sustaining our economic growth. 1) Green Growth, 2) Resource Efficiency, 3) Technology Advancements and expanding resources.

The paper presents the outcomes of these policies by modeling their impacts on renewable resources and economic growth using system dynamics modeling. Very importantly it shows that even with resources which are renewable, there are limits to growth. The WORLD2, WORLD3   models of Limits to Growth showed it 45 years ago but using only non renewable resources.

I hope you enjoy reading the paper (the text is not long, less than 5000 words).

Come back and we shall together ponder over the following questions:

  1. How do we define, understand, perceive true sustainability of resources?
  2. What conditions (social, economical, physical) would enable sustainability?
  3. How much time do we have left to act on them?