Collaborative Capitalism - The Detail Behind the Soundbites?

"It’s the economy, stupid"

The centre-ground that is occupied successfully by any political party is the one that focusses on economic stability.  If a party cannot be trusted to be a safe pair of hands when managing the economy, then it has no credibility.

But since the last time we had this conversation twenty-odd years ago, things have changed.  Pay inequality has grown, as salary rises at the top vastly outstrip the increases in the middle and bottom.  Familiar companies that were considered national institutions have disappeared, gobbled up by private equity and larger corporations, without account being taken for their importance as national symbols of success and collaborative capitalism.  Building a business or a service, and creating value is not considered as interesting as the quick win of trading and the X Factor of takeovers.  Suddenly 'moral' capitalism is back battling against 'crony capitalism'. However I don't believe these  soundbites are anything but a reaction to what is happening.  There is very little detail on what a better future might look like.

Which is where collaborative capitalism comes in.  It has a long history in the co-operative movement and the Quaker-founded businesses of the eighteenth and nineteenth centuries: in the paternalistic industries from the turn of last century and the social enterprises of the last 50 years.  The time has surely come for a “less degenerate capitalism”.

Collaborative capitalism is based on the principle of working together.  It means a long-term approach to business and the economy.  It means productive investment: in skills for workers, in creating products that last, and buildings that are efficient.  It means working to the triple bottom line, where sustainability (in the Brundtland sense of the word) means considering the social, the environmental as well as the financial consequences of what you do.  It means support for SMEs and businesses that are embedded, and invest, in their communities.  Collaborative capitalism is innovative, because it pays attention to the viewpoints of many, not just the people with the largest share.  It is open-source, crowd-sourced and crowd-financed.  It is networked.

And it is happening. It’s happening with RiverSimple’s open-source car designs, with crowd-financed films like the Age of Stupid, with 38 degrees’ campaigns and in workspaces like The Hub.
The examples above of collaborative capitalism have happened in spite of, not because of, government.  However, there is a case for the state and it is one we should be arguing.

Government should provide the safety net for when things go wrong.  When entrepreneurs remortgage their homes, or invest their savings for projects they believe in, then there is an argument that this level of risk deserves a  different level of reward.  Taxes can be used to incentivise the long term holding of investments over the short-term trading for quick profit.  If we care about the environment, we need to have the conversation about whether ultimately resources should be taxed, rather than labour.  Government procurement should drive innovative change, not orders abroad.

Government is a partnership.  We must weed out the disingenuous arguments from the right that we’re all in it together when the economy is actually going backwards.  We need to show where growth can come from – collaborative capitalism is part of the solution.

Christmas and Consumerism

The consumerism of Christmas always highlights to me the difficulties that we face in reducing our environmental impacts.  Finding resourceful solutions to these problems will take time, but I am encouraged by the increasing role of the circular, or closed loop, economy.

One only has to look at the tenders that WRAP have been putting out this year to see that the shift to resource security and new ways of working is well underway.  To many people, the waste sector is one that is focussed on the stuff we throw away.  But for those of us working in it, it has always been about the resources we use, and how to use them better, with less impact.  As the world shrinks and economies grow, the way we use these resources becomes more important.  Back in 1972 the Club of Rome wrote the first Limits to Growth report, arguing for the importance of the environment and the things it provides for us.  At the time, the counter-argument won the day, as in economic terms, resources that are valuable will never run out, just become increasingly expensive.

Now, with the growth of China and the BRICS and the ever-consuming populations, the limits to growth arguments are once again reaching the mainstream.  It is not only the coal or the rare earth minerals that we should be concerned about, but also the ability of the ecosystems to provide the vital services we need - clean water and air.

I went to a fascinating Green Alliance event last week that explored the issue of resource resilience and security.  We talk regularly about energy security, but our economy also needs resource security, or resilience, if it is to be sustainable.  Hence the new focus on different models of business, where products are leased, not sold.  Where jobs are created in service and maintenance if not in production.  Where new organisations, such as the Ellen Macarthur Foundation are aiming to educate the next generation.  If this is the way we are headed, then I am feeling positive about 2012.  So as you unwrap those presents, the challenge is to see if you can think of a different way for the wrapping paper industry to work.  Merry Christmas!