Sustainability is the better business model

Amazing case for sustainability in business on TED.

Ray Anderson tells the story of how he set out to change the economic model that governed his company Interface (and still governs most businesses).

The dominant industrial model is extractive, linear (take – make – waste), abusive, focused on labor productivity, dependent on fossil fuels. In this model environmental impact (I) is generated by people (P), what they consume (their affluence – A) and how it is produce (the technology – T). Paul and Anne Ehrlich summarized this as:

I = P x A x T

Realizing that he had the power over the way his products are made, Ray started working since 1995 to change that formula for Interface to

I = (P x A)/T, so that technology decreases the impact instead of multiplying it.

Towards the end of his talk he then goes a step further to advocate that affluence expressed by a capital A denotes an end in itself, and should instead be a small ‘a’ that is a means for happiness, thus changing the formula to

I = (P x a)/(T2 x H)

Great vision! Watch the video to hear the numbers of how this model made his company not only reduce a lot of its impact (they aim for 0 impact by 2020) but also much more competitive.

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