c4sense
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Building the Impact Economy on the Doughnut Model.

Kadarius Seegars | Unsplash

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Include the limits of the Planet in the economic models.

A model that measures the performance of an economy by the relationship between stakeholder satisfaction and compliance with ecological constraints emerged in 2017 and was made central to its development strategy by the city of Amsterdam in 2020: The Doughnut economic model.

Theorized by Oxford economist Kate Raworth, the Doughnut Model provides a framework for sustainable development economics by combining planetary and social boundaries and by setting the goal for the economy to maximize under the double constraint of 1) social satisfaction and 2) not overstepping the ecological boundaries and limited resources of the Planet

The social frontiers are inspired by the UN’s sustainable development goals: food, health, education, wages and labor, peace and justice, public opinion, social equality, gender equality, housing, social capital, energy, water.

The planetary boundaries, or ecological ceilings, are inspired by the scientific work of Johan Rockström: climate change, ocean acidification, chemical pollution, nitrogen and phosphorus loads, freshwater consumption, land conversion, biodiversity loss, air pollution, ozone depletion.

A framework for building the impact economy.

This model formalizes the constraints that the economy must set for itself to ensure a fair and sustainable future. It gives a meaning, an objective, which can become common to each economic agent.

The entrepreneurial focus must be on the right balance between the financial performance essential to any economic activity and the generation of positive impact for the World, including the respect of its limits and social well-being. In our daily or professional lives, let’s appropriate this model to guide our decisions and build a virtuous economy. To build a new version of capitalism.

A business model cannot be viable in the long term if it is built on a bankrupt planet. A company cannot be sustainable in the long term if it does not integrate the social dimension in its strategy.

A company’s raison d’être, a goal greater than itself, is a factor of growth. This raison d’être allows the company to be readable, to federate and to weave stronger links with its stakeholders.

Let’s build these new models together!

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