Eco-nomics

The New World Order
By Marjorie Kelley
Business Ethics

WE ARE A GADGET-FIXATED NATION. For at least a hundred years, we've been convinced that gadgets will transform the world. And they have. But other trends have been equally transformative. Until World War 1, kings sat

enthroned atop nearly all nations of the globe; today few remain. The 20th century ushered in worldwide democracy, and stunning social transformations followed: votes for women, civil rights, civil liberties,, environmental protection.

And so, as the odometer turns over again, we might ask: What does the new century hold besides wondrous gadgets? What new social transformations will it bring? The most important, I believe, will be the movement toward a humane, sustainable economy. As the 20th century brought democracy to governments, the 21st century will bring democracy to economicscreating an. economy that serves not the few but the many. I rest this prediction on six promising trends:

1. INDUSTRIAL PROCESSES WILL INCREASINGLY MIMIC ENVIRONMENTAL PROCESSES.
Among the most innovative examples are the "living machines" developed by John and Nancy Todd and "built" by Living Technologies in Burlington, Vermont. Both garden and machine, they are "designer ecosystems," like the wastewater treatment facility for the Ethel M Chocolates processing plant in Henderson, Nevada, which is a lagoon teeming with snails, shrimp, goldfish, pampas grass, cattails, and palm trees. These organisms work together to break down organic pollutants-showing how biological design can move us toward sustainability.

2. THE ENVELOPE OF THE POSSIBLE WILL CONTINUE TO EXPAND.
Electricity Daily reported recently on a "clean combustion system for coalfired boilers that emits no pollutants, only molecular nitrogen (air). If it works on a large scale, we might soon

see coal-burning power plants that don't pollute. Then there's the hydrogen economy, which may be closer than we think. Hydrogen batteries run without recharging, because they run on hydrogen from air. And if hydrogen is produced using renewable sources like solar power, the only by-product is clean water. A hydrogen economy could spell the end of the hundred-year reign of fossil fuels.

3. RECOGNITION THAT SOCIAL ISSUES ARE FINANCIAL ISSUES WILL GROW.,
We've seen it already with asbestos, nuclear power, breast implants, and tobacco-all industries strapped by social concerns. It also is happening with genetically engineered (GE) food ingredients, which Gerber and Heinz recently banned from their baby food. Archer Daniels Midland said it would -stop buying soybeans and corn commingled with GE varieties. More ominously, Deutsche Bank advised investors to unload their shares in companies involved in the development of genetically modified organisms, predicting the biotech' food industry was "going the way of the nuclear industry." We'll see it again and again: Social issues are becoming financial issues.

4. PROFITS WILL NO LONGER BE THE SOLE CRITERION OF SUCCESS.
If you're tempted to dismiss this as a pie-in-the-sky prediction, hold on to that pie plate: It's already happening in managed care, an industry under attack for pursuing profits too fiercely. The U.S. House of Representatives voted in October to allow patients to sue their HMOs. That same month in federal court in Mississippi, lawyers filed a class action suit against Aetna Inc., charging that its cost contain

meat (profit maximizing that is) amounted to mail fraud-because the company delivered less than promised. Company stock fell nearly20 percent. The message, If maximizing, profits means denying needed health care, then profits must be sacrificed. This message is likely to spread to other social issues.

5. EMPLOYEES WILL BECOME MORE AGGRESSIVE IN SEEKING POWER INSIDE COMPANIES.
College-educated, knowledge workers will soon be the largest, class in America, and they've been surprisingly quiet--despite years of stagnant wages, pension cuts, lengthening hours, and reminiscent of the silent malaise Betty Friedan spotted among housewives, which became a feminist revolution. Odds are, a similar employee awakening is not far off. IBM employees have begun to unionize.

6. PROGRESSIVE COMPANIES, THAT EMBRACE SUSTAINABILITY ARE LIKELY TO PROSPER
As Chris Gibson-Smith of 'British Petroleum put it, sustainability is "one of the most profound source-, of innovation." Companies that don't understand this will suffer. Take global warming: In a recent Washington Post column, David Ignatius warned that companies denying its dangers may be on the same path as tobacco firms denying the dangers of smoking. "In a world where rising seas are inundating Miami," he wrote, "the potential liability could total trillions of dollars." Sustainable management is simply better management.

Marjorie Kelly is co-founder and editor of Business Ethics (www. business-ethics.com), a Minneapolis-based bimonthly publication on corporate social responsibility. Reprinted from Business Ethics (Sept/Oct. 1999). Subscriptions: $49/yr. (6issues) from Box 8439, Minneapolis, MN 55408.


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