Writing for The Wall Street Journal last month, Al Gore (yes, that Al Gore) and David Blood share their thoughts on why the race towards "sustainable capitalism" must begin at once. Sustainable capitalism is exactly what you think it is: a free market system by which companies perform better in the marketplace based upon certain environmental goals and objectives. Of course, the idea of companies and markets that help the planet and its citizens is nothing new. As we mentioned just last week, social entrepreneurship is on the rise and will continue to grow. Likewise, the great work being done by B Corporation shows how businesses can be measured by more than a single bottom line.
But perhaps most important about Gore's and Blood's (Wait - was that an article really written by Blood and Gore? Yes. Yes it was.) editorial is their astute grasp that the effects of business must be measured by more than dollars and sense. The pair call for a new set of protocols, including the understanding of short- and long-term implications for operating a company or economy without regard for its future environmental consequences. They cite the recent mortgage crisis as a parallel:
That's exactly what occurred when the true value of subprime mortgages was belatedly recognized and mortgage-backed assets were suddenly repriced. Until there are policies requiring the establishment of a fair price on widely understood externalities, academics and financial professionals should strive to quantify the impact of stranded assets and analyze the subsequent implications for investment opportunities.
In other words, until we have an easy figure or system to measure the true cost of a toy or a set of sheets or a hot dog on our planet, we've got to start making guesses and we've got to start now.
This is exactly what many labels try to do, whether it's a USDA label that says something about our food, a fair trade label that certifies coffee or clothing, or an SFI label to call attention to something's impact on forests (see our recent interview with Karen Brandt of SFI). Labels must matter to us now as a great way to make a guess at a product's impact on the planet - at least until we have a better, bigger measurement in place.
The moral of the story? Seek out companies and products that proudly proclaim what they're doing to help our world. It's not bragging; it's just good business.
What do you think?
Can sustainable capitalism really happen in today's world? And are labels a good way to raise awareness about what's possible? Weigh in below.