Posts tagged financial models
4 Business Tips That Can Save The World
A few years ago I read an article in the Harvard Business Review that created a proverbial whack upside the head. Titled A Road Map for Natural Capitalism, the article explains that we ignore one major capital component in our financial models: the value of Earth’s services, nature’s capital contribution to our success.
We just don’t think about—much less figure into our budgets—things like water storage, atmosphere regulation and the other life-support services because Mother Nature is the vendor. These services have huge economic value. Some, in fact, are priceless because there’s no known substitute. But because we don’t count them among our resources, or for the most part haven’t considered them at all, they’re being liquidated.
Here’s the deeper issue: when resources seemed boundless, low per-capita productivity and a relative scarcity of workers drove innovations in technology and processes that led to increased productivity (the Industrial Revolution). Today we have lots of people and labor-saving machines, but natural capital is disappearing. In the same way the Industrial Revolution replaced agrarianism, a new era of natural capitalism, or whatever future historians decide to call it, will inevitably transform the way we do business now.
