COVID-19 - A Pivot to What’s Next
“I visited the Ellington Street Garden in Dorchester, MA last week. As I cleared garden beds and piled last year’s growth onto the compost pile, I could feel the soil’s anticipation and the hope of renewal when community members planted their seeds and seedlings. My face mask had fogged up my eyeglasses, and I didn’t notice when Ms. Estella came by to say hello. I was resting by the gate when Ms. Carolyn drove up to see who was ‘messing about the garden.’ We gave each other virtual hugs. We shared smiles, news and celebrated the gifts of locally grown food.”
Spring invites us to renew, reinvent, and reimagine ways to organize ourselves and our lives. This spring is unique in so many ways, and we are called to be curious and courageous. COVID-19 has exposed some enormous cracks in our social systems. Having spent the last five weeks exploring the reasons why regenerative investing is so important, we want to examine both how and what regenerative investing looks like. We want to explore solutions that address underlying inequities and ways that investors and entrepreneurs can collaborate to regenerate the critical elements of healthy communities. As a wealthy individual, as a board member or investment committee member, as a leader in government or as a citizen with a conscience – we each have a role to play.
History is a good place to start a new chapter in the COVID-19 series, so let’s review the three ages of extraction and exploitation that presage the new age of regeneration that is coming. From 1470 when the Portuguese established Elmina in West Africa - an entrepot trading enslaved people, gold, and ivory - to 1770 when HMS Endeavour (commanded by Captain James Cook) grounded on the Great Barrier Reef off of Australia – the world witnessed extraordinary exploitation of people through genocide and enslavement. Human capital was converted into financial capital in a crushing, absolute way.
If the first age was the age of human exploitation, we will call the second age (1770 to 1970) the age of natural resource exploitation. During the Industrial Revolution we witnessed the despoliation of nature: ranging from the global carnage caused by whaling ships to the obscene destruction of 50,000 square miles in Alberta Canada in search of tar sands. During these two ages - five hundred years of global destruction - human beings developed a capitalist economic system from its mercantilist roots. We developed technologies, political systems, and social contracts to convert human and environmental capital into financial capital at a devastating scale.
The third age of extraction and exploitation emerged in 1970 and continues to grow. In the last fifty years the Information Age has transformed the world. Communication technology and data storage has increased convenience and brought the world closer. At the same time, we have seen companies extracting value from all the personal (private) data that individuals offer in exchange for “free services.” We offer intimate details of our lives in order to get directions while driving, to gain discounted pricing on consumable products, and to enjoy the convenience of knowing when our next double latte is ready for pick-up. Converting civic capital (the threads of social cohesion: e.g., friend groups) into money is the latest model in our short history of capitalism. We all stand in awe of the market capitalizations of Amazon, Alphabet, Alibaba, and the other companies that perform this financial alchemy.
If we have exhausted the stores of civic, environmental, and human capital, what investments will regenerate depleted capital stocks and provide a financial return? We can invest in communities, and we can invest in businesses that contribute to environmental and community health. Let’s start by defining for ourselves both what is “enough” financial return and what non-financial returns offer meaning. Investors have power, and so do communities. If we are smart, we can align our financial and non-financial return goals with the communities’ objectives.
Enlightened people around the world are thinking about these issues. Oliver Dudock van Heel works for the law firm Freshfields Bruckhaus Deringer, headquartered in London, UK. His writings on sustainability reflect our collective interdependencies. Groups like Feedback Labs explore “trust” between investors and communities – affirming the values of TILT’s multi-stakeholder philosophy. Our collective intelligences will overcome the virus. Will our collective intelligences lead us to regenerate the human, environmental and civic capitals that we have converted into money?
Influential lawyers, global health leaders, renewable energy specialists, and a myriad of entrepreneurs are bringing forward disruptive business models. Many of these enterprises will align their purpose with the needs and goals of communities. Some of these will generate outstanding financial and non-financial returns. Thoughtful investors from all around the world are studying the physical and social infrastructure needs that COVID-19 has exposed. Will you join the movement to finance those new enterprises?
“I learned yesterday that Ms. Estella’s brother died of COVID-19. Today I learned that Ms. Carolyn’s father had died from the virus. Suffering surrounds us, our friends and family are dying - and we can do something about that.”