Beyond Sustainability: The Regenerative Business

By Navi Radjou

The Regenerative Business GETTY

In recent years, US manufacturers have taken major steps to make their supply chains more sustainable in an effort to fight climate change.


Earlier this year, GM appointed its first chief sustainability officer Dane Parker to drive the carmaker and the nation towards an all-electric, zero-emissions future (GM plans to produce 20 new all-electric vehicles by 2023). By adopting the circular economy principles aimed at zero-waste, SC Johnson has already made 94% of its plastic packaging recyclable, reusable, or compostable. And Levi Strauss is shaking up the apparel sector, a top contributor to global warming, by committing to reduce its greenhouse gas emissions within its own facilities by 90% by 2025.


All these noble sustainability strategies—reducing waste and emissions and switching to renewable energy—aim to “do more with less”, that is create more economic value by polluting less and using fewer natural resources. But this “do less harm” (to the environment) posture is not enough, for three reasons:


First, climate change is worsening, and resources are getting scarcer. This year, Earth Overshoot Day—the point in the year when humanity’s natural resources consumption exceeds the planet’s ability to regenerate—was on August 22, earlier than ever.


Second, Covid-19 is making racial and socio-economic disparities in America even worse. As a result, values-conscious employees and consumers want US businesses to take a stand against racism and all forms of inequality and positively contribute to society.


Third, US consumers wants companies to go well beyond sustainability and “do more good” to the planet. According to a study by ReGenFriends nearly 80% US consumers prefer “regenerative” brands to “sustainable” brands (they find the term “sustainable” too passive).


What is regeneration? We can learn it from Nature. In her stirring TED talk ‘How trees talk to each other’, Suzanne Simard, a forest ecology professor at University of British Columbia, shows how Nature is generous—a virtue you don’t associate with the cut-throat corporate world. Forest trees magnanimously share information and nutrients with each other using a deep network of soil fungi.


What if companies reinvented their supply chains and business practices so they function altruistically like a forest? Then they will operate as regenerative businesses that give back 10x and even 100x more to society and the planet than what they take from it.


Whereas a sustainable firm seeks merely to reduce its ecological footprint, a regenerative company boldly seeks to increase its socio-ecological handprint—as Harvard professor Greg Norris puts it—by restoring the health of individuals, communities and the planet (see graphic below). In doing so, regenerative businesses can achieve greater financial performance and impact than their sustainability-focused peers.  


Beyond Sustainability: The Regenerative Business NAVI RADJOU

Excitingly, pioneering US manufacturers like Danone North America, General Mills, Interface, and Patagonia are leading the regenerative revolution in America and worldwide.


As part of its Climate Take Back mission, whose goal is to reverse global warming, Interface, the world’s leading modular carpet manufacturer, has built in Australia a “Factory as a Forest”. This virtuous new plant provides freely to its surroundings many ecosystem services—such as clean air and energy, potable water, carbon sequestration, and nutrient cycling—that the local ecosystem it replaces used to provide. Interface is looking to build similar regenerative facilities worldwide, including in the US.


Interface is making all its products regenerative too. By 2018, it has made all its products carbon neutral. Now, it’s raising the bar much higher. Earlier this week, Interface launched the world’s first carbon-negative carpet tiles, which sequester more carbon than they create throughout their entire lifecycle.


Some vanguard US manufacturers want to regenerate not only the planet, but also the individuals and communities suffering from the Covid-19 and the recession. In doing so, these visionary firms are trailblazing triple regeneration, an integrated strategy to restore, renew, and grow people, places, and the planet (3Ps) in a cohesive and synergistic way.


The food giant Danone is leading triple regeneration with its “One Planet. One Health” initiative. Danone North America is enabling its US farming suppliers to adopt regenerative agriculture, a science-based approach that uses science-based techniques and natural methods like crop rotation to enrich the soil, preserve biodiversity, and enhance animal welfare. By adopting these practices, financially-challenged US farmers can “do better with less”: they can boost yields—hence their revenues—and the long-term value of their land while minimizing emissions and use of toxic fertilizers and precious irrigation water. Regenerative agriculture can revitalize vulnerable US rural communities and reverse climate change by sequestering carbon in the ground. US consumers benefit too as they get to eat nutrients-rich food produced by high-vitality soil.


The industrial sector account for 22% of greenhouse gas emissions in the US. To reverse climate change—a clear and present threat to their long-term survival—US manufacturers must radically reinvent their core business models and end-to-end supply chains. They need to go beyond sustainability and boldly think and act as net-positive regenerative businesses that can do better with less.


By regenerating people, places, and the planet—just like Interface and Danone North America are doing—US manufacturers could enhance the well-being of millions of people and revitalize thousands of communities. By co-building a carbon-negative regenerative economy, US manufacturers can potentially unlock $26 trillion in financial value and produce over 65 million new green jobs globally by 2030.



Navi Radjou is an innovation and leadership advisor to Fortune Global 500 companies. Co-author of Frugal Innovation. TED Speaker. Winner of Thinkers50 Innovation Award. Former VP at Forrester Research. Regular contributor to HBR and MIT SMR.


https://www.forbes.com/sites/naviradjou/2020/10/24/beyond-sustainability-the-regenerative-business/#37764d5b1ab3


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