x
Source: Creative Commons

Source: Creative Commons

The world of social entrepreneurship is changing waaayy faster than most of us realize. I spent last week with two veterans of the financial services world, collectively responsible for raising over $100 billion (yes, with a ‘b’) of investor assets who now want to redeploy assets for the betterment of the planet as a whole. I’ve met two brilliant ex-lawyers who are dedicating the second halves of their careers to helping businesses get more conscious of all their effects on the planet on the one hand, and elevating people out of poverty on the other. A successful businessman I met while in Nepal on meditation retreat is now dedicating 80 percent of his time and energy to social enterprise and philanthropy. Many of the brightest minds coming out of the best MBA programs want to work in social entrepreneurship. Some of the world’s largest corporations are hiring a London-based consulting firm I met with to assess the true environmental costs of all of their products (including their supply chains), and what would happen to their profits if governments assessed these costs (as they should be assessing, and in my opinion, will be sooner than most of us think).

An Astounding Pace of Change

The pace of change is astounding. And yet it may not be enough. The great majority of the scientific community believes we are on track for global temperature rises of more than 2 degrees Celsius in the next 20 years, the point at which oceanic tides may reverse and consequences become impossible to model, be they mild in consequence, or be they natural disasters, species extinction, or widespread drought and famine. There are billions of people living in poverty, and poor people without opportunity represent fertile breeding grounds for brutal dictatorships, terrorist recruitment, and confiscatory fiscal policies.

Walmart's Direct Farm program in China. (Photo: Walmart / Flickr)

Walmart’s Direct Farm program in China. (Photo: Walmart / Flickr)

A New Industrial Revolution Is Afoot

But the last 160 years have shown that we can innovate entire continents out of poverty. And the last 20 have shown that we can reduce the depletion of natural resources without reducing our standard of living. There is a new industrial revolution afoot. Over the next 40 years, it has the potential to help developing economies increase agricultural productivity to the point that most of their populations can pursue education and other goals, hunger becomes a thing of the past, and life expectancies begin to rival those of the developed world. China will be a world leader in sustainable development and almost all environmental costs will be borne by producers and consumers of products and services, incentivizing an economy that uses a fraction of the resources of 2013 to produce better standards of living.

Just as in the first industrial revolution, the changes will not be gradual or steady. There will be fits and starts, rapid expansions and scary contractions. Legislatures will find that the taxation of harmful activities is the most politically palatable way to raise revenues and has the added benefit of reducing consumption or incentivizing producers to find alternate inputs. When political will swings in this direction on a country-by-country basis, legislation will be enacted rapidly, and those companies on the tail end of sustainability will find their profits and market values decimated. Those who have voluntarily moved in this direction will gain market share and profitability from the losers. The overall trend of this period will be a dramatic increase in true wealth, and in my personal opinion, those who deploy investment capital to fund these most critical needs of humanity will earn outsized returns, as they have since 1860.

(This article first appeared on Abacus in June 2013. It has been reprinted here with permission.)

Print Friendly

Leave a Reply

ENVIRONMENTAL NEWS
FROM THE FRONT LINES

#KnowYourPlanet

Get the top stories from Planet Experts — right to your inbox every week.

Send this to a friend