Meadows & The Sustainable Economy

     “The Big Idea- The Sustainable Economy” presented many ideas that could be easily applied to systems thinking. Resilience, self-organization and hierarchy are three characteristics of systems described in Meadows, Chapter 3. In particular, resilience is the ability of a system to survive and persist in a changing environment. In order to maintain a healthy, smart and resilient business model, it is important to incorporate sustainable practices. As Chouinard, Ellison and Ridgeway stated in their article, businesses are now internalizing costs that have been ignored as externalities in the past. By doing this, as well as reducing energy costs and improving working conditions, businesses will see more profits in the long run, while also helping the Earth. Although the monetary savings may be the major draw to sustainable practices at first, the environmental impacts can also prove to benefit the business as well.

     Meadows presents many different ways that systems can “surprise” us in Chapter 4. The workings of our economy and consumer habits are a dynamic and complex system that we encounter on a daily basis. As consumers we may fall into bounded rationality, which Meadows describes as making reasonable decisions based on the information at hand (106). We may take into account what we know about our own needs, the product we are purchasing and sometimes the company that produces the product, when we are buying a particular item. It may be difficult at times to make smart consumer decisions that are eco-conscious if this information is not readily available to us. One way that sustainable businesses can alleviate this issue is by being more transparent with their actions, mission and goals. Similarly, we can step out of our bounded rationality and learn more about businesses that may not be as safe or healthy as they perceive themselves to be and make decisions based on that information.

     Chapter 5 explains archetypes of problematic behavior. One that could be applied to the premise of a sustainable economy is tragedy of the commons. Tragedy of the commons is the instance of a commonly used resource; every user shares the benefit of that resource but also its abuse. As a society, we don’t often think of where our products come from, how they are made or what resources and energy went into it. One facet of a sustainable economy is to work on attaining materials for production sustainably and responsibly without disrupting the environment. We are all inter-connected and as we use resources, we need to be cognizant of overuse so as not to inconvenience or harm someone else. As Chouinard, Ellison and Ridgeway discuss, one way to take into account the value of our environment is to place monetary value on our ecosystem services. In this way, our society can have a more tangible connection to the resources that are being used.

Question: How can businesses/companies/organizations change to a more sustainable business model without losing support from their patrons or customers that may not agree?

Comments

[Alec Brazeau]

I think that in order for businesses/companies/organizations to include sustainability in their business model in a way that all patrons and customers can agree upon, the business needs to frame sustainability in an economic and rational way instead of a "green" and environmental way. Tell me how much the company saves by installing solar panels, don't tell me why its the "right" thing to do. While being sustainable is actually the "right" thing to do, not everybody sees it that way, or frankly cares enough to act upon it. Some people need to be convinced that having a sustainable business model is important money-wise as well as environmentally.

[Mallika]

(I realized the comment I tried to post a few weeks ago didn’t actually post, so I am reposting it per Bruce’s instructions)

I agree with your point about consumers facing challenges with bounded rationality. Often the information we need to make sustainable purchases isn’t available. In my own experience, I’ve struggled to find clothing brands that are produced without severe environmental or human rights impacts, simply because of the lack of transparency in the clothing industry (although maybe the sustainable apparel coalition will help change that!).

Availability of sustainable products can also be a challenge. I recently tried to convince my sister to purchase more sustainable food from her local grocery store. She was interested in the idea, but found that the grocery store near her didn’t carry any Marine Stewardship Council certified products. She’s not willing to shop further afield, which makes it challenging for her to change her shopping habits.