1.4 Lesson-4: Towards Regenerative Economy

One aspect of restructuring our economy with ecological principles is to center our industrial system of manufacturing and consumption on the circular patterns of energy and resource use that we see in mature ecosystems. It requires us to ask more probing questions and start more extensive transformational change in order to properly develop a regenerative economy.

Many conventional economists were stunned into understanding that the existing system is fundamentally broken by the stock market crisis of September 2008. Several of them have since developed into successful change agents for the shift to a regenerative culture. We should celebrate the newly discovered support of those with access to and the respect of significant decision-makers rather than denouncing these highly intelligent, well-connected, well-resourced, and incredibly competent individuals for their roles in contributing to some of the Horizon 1 mess (which we all had a part in). In contrast to commoditized transactions, a regenerative economy would have crucial value-adding exchanges taking place inside networks of reciprocal relationships. Encouragement of people to uncover their essence, develop, and create new things throughout all spheres of society, in addition to the business sector, is a crucial component of the shift to such a system. People must feel empowered to engage to a healthy human economy by negotiating according to their enlightened self-interest as they automatically promote the health of the total in order to increase participation.

We will realize that by restoring the well-being and prosperity of our ecosystems and communities, we are generating wealth for all if we learn to view wealth comprehensively rather than only in terms of money.

Wastes will be totally recycled or repurposed in a continuing, productive, circulatory, and value-enhancing flow, mimicking the metabolic process observed in resilient living systems. Both knowledge and money would flow in predictable ways. In comparison, a regenerative financial and economic system seeks a compromise between effectiveness and resilience, huge and small, diversity and homogeneity, innovation and preservation, flexibility and constraint. Self-regulating mechanisms and feedback loops preserve the dynamic equilibrium in ecosystems.

Instead than encouraging the unchecked quantitative growth of one separated subsystem, creative utilization of the “edge-effect” fosters the qualitative growth of any and all subsystems. Designing to increase the “edge effect” is an application of economic biomimicry. In order to increase the likelihood of value-adding creating wealth through these interpersonal exchanges that take place “in relationship,” the regenerative economy will aim to create “edge effect” circumstances with rich interaction and high diversity at various scales. These conditions can manifest in “intense collaboration across multiple areas (government sector, NGO sector, and private industry), cultures, and demographics.

A key accomplishment of a regenerative economy will be to effectively link the local, regional, and worldwide levels of nested regenerative systems. A connected, place-centered mosaic with this kind of scale-linking design would foster strong, healthy communities locally, regionally, and globally. In order to create and preserve greater fairness locally and globally, scale-linking coordination between the many “local living economies” and regional economies within a wider perspective will be crucial.

When wealth is viewed holistically, it largely manifests as the state of the entire system. A regenerative culture and many features of healthy social economic systems cannot be reduced to monetary sums of money. These are attributes that are rooted on being fostered by and cultivating collaborative partnerships, hence they elude quantification.

Instead of focusing solely on financial capital, a regenerative economy will reframe wealth in relation to different forms of capital. According to the whole-systems economics map provided by Ethan Roland and Gregory Landua, wealth is based on eight types of capital: living, cultural, experiential, intellectual, spiritual, social, material, and financial capital. When we examine the function of regenerative enterprise, we will go back and discuss this concept in further detail.

One of the most important steps in developing a regenerative economy is to reroute the flow of financial resources away from the speculation to the real economy as well as from destructive and exploitative to generative and for-benefit firms.

Furthermore, we must rethink the function of the banking system in order to create a regenerative economy. The Global Alliance for Banking on Values is a network of autonomous banks that uses money to provide underserved individuals, communities, and the environment with sustainable development. One of the most important steps in developing a regenerative economy is to reroute the flow of financial resources away from the speculation to the real economy as well as from destructive and exploitative to generative and for-benefit firms.

The alliance consists of leading, cutting-edge banks from six continents who are all dedicated to providing social finance products, funding community-based development initiatives and social entrepreneurs, fostering ecologically sound enterprises, and achieving human development potential, including poverty alleviation.

The alliance is made up of top, cutting-edge banks from 6 continents who are all committed to offering social finance products, supporting initiatives for local community development and social entrepreneurs, encouraging environmentally friendly business ventures, and achieving the full potential of human development, including eradicating poverty.