3 Laws for Business to ensure that we don’t destroy ourselves.

We use rules for how we create robots so that we don’t destroy ourselves. It’s time for a similar set of rules for business.

“A system that destroys itself either needs to adapt to the new realities it has created and evolve accordingly, or face the risk of extinction.”
     
Brad Zarnett and Ian Kaplan, Climobilize

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Despite the great advances brought about by our economic system, the planet’s ecosystems are being crushed under the weight of our success. With every new product or “life improving” innovation the more resources we use and the more we degrade the natural systems that we rely on.

We are now experiencing 1 in 100 year storms (tail risks) and impacts every year or two, and sitting on the horizon are the next set of 1 in 100 year storms. The coming damage will be even more extreme, making it hard to even fathom the impacts that will be orders of magnitude worse. And if we're not planning for those, we're practically accepting a situation that will lead us to the unthinkable - the complete breakdown of all the systems on which our civilization depends. The term is “planetary insolvency” as it is referenced in the 2024 "Climate Scorpion" report.

Good News

We don’t need to be anarchists and tear everything down for things to improve. We don’t need to destroy the entire economic system - we just need to put some new “guardrails” on it - some new laws that define what is “in-bounds”, and what is “out-of-bounds”, driving behavior in a way that doesn’t destroy us, but rather, that delivers “sustainable profits”. And fortunately we have a prototype that we can use for our economic system. 

3 Laws For Robotics

In 1942 Science Fiction writer Isaac Asimov created the 3 laws for robotics as outlined in his short story, “Runaround”. The laws were simple and they were designed with the ultimate goal that humans don’t create something that can destroy us. 

Law #1:
A robot may not injure a human being or, through inaction, allow a human being to come to harm.

Law #2:
A robot must obey the orders given to it by human beings except where such orders would conflict with Law #1.

Law #3:
A robot must protect its own existence as long as such protection does not conflict with the Law #1 or Law #2.

3 Laws For Business

Since we don’t want business and global commerce to destroy us, Climobilize has devised “3 Laws of Business” that, (structured similarly to the 3 Laws of Robotics) aim to facilitate continued economic profitability while preventing permanently harming people and the underlying environmental systems upon which we depend. The goal is to create "economic guardrails" to ensure long-term sustainability and profitability while simultaneously preventing business from undermining the viability of the very systems upon which it depends, resulting in instability, uncertainty and, ultimately, insolvency.

Law #1: A corporation may not engage in activities that exceed their entity-specific allocations of vital capitals*.​ (This means companies are required to operate within their allocations to prevent breaching either minimum or maximum capital thresholds, ensuring the sustainability of all forms of capital upon which they and other stakeholders depend.)

Law #2: A company may pursue profits to ensure its continued existence so long as such pursuit does not conflict with law #1.

Law #3: To ensure "strong sustainability", a corporation may only exceed its allocated share of capital* IF such excess can be offset by capital reserves or a compensatory arrangement within the same capital class (i.e. no cross-capital trading!), ensuring cumulative effects remain within capital threshold limits.

* 7 forms of capital are referenced here: natural, cultural, human, social, political, financial, and built/manufactured.

Earnings and Growth Are Still Good!

The idea is not to try to “plan” how the economy operates or cap earnings or growth, but rather, to refine and provide guidance for the way that we achieve growth so as to not leave a trail of damaged and degraded ecosystems in its wake. Profit is fine so long as we do it in a way that doesn’t destroy us. 

On the Road to Transition

We believe that this can be accomplished through the adoption of these 3 laws that can shape the transitioning of business and corporate mindsets from “profits at all cost”, to “sustainable profits”.

That is why Climobilize’s Scorpion’s Tail Club has adopted these 3 Laws as the guiding principles for the urgently needed discussions about the policies and supporting legislation to help us ensure planetary solvency.

If this resonates with you - especially if you’re in the financial sector - we’d like to speak with you.

Brad Zarnett and Ian Kaplan
Co-Founders, Climobilize Scorpion’s Tail Club

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