Reframing Our Economic Outlook: Towards a Sustainable and Regenerative Future

Reframing our view of the economy to support a truly sustainable and regenerative relationship with the planet requires us to redefine what we value and what we measure as “success.” Here are a few ways this shift might happen:

1. Move from Growth-Driven to Well-Being-Driven

Our current economy is heavily growth-driven, where GDP growth is often equated with prosperity. But a GDP-centric view overlooks the environmental and social costs of that growth, including pollution, resource depletion, and social inequality. We could replace this with a well-being-driven economy, where success is measured by metrics like environmental health, social equity, and individual well-being. Initiatives such as New Zealand’s Wellbeing Budget, which prioritises mental health, child well-being, and environmental quality over pure economic growth, show how this could look in practice.

2. Embrace Regenerative Economics

Instead of merely sustaining the current state, a regenerative approach to economics aims to restore and enhance ecosystems. For example, agricultural practices like permaculture and regenerative farming restore soil health, capture carbon, and support biodiversity. Applying this idea across other sectors could encourage companies to adopt circular economy practices, where products are designed for durability, repair, reuse, and recycling, minimising waste and reducing resource extraction.

3. Prioritise Local Economies and Decentralisation

Globalisation has its benefits but has also led to environmental degradation due to extensive shipping, reliance on non-local resources, and disconnection from the direct impact of consumption choices. By strengthening local economies and emphasising self-sufficiency, communities can become less reliant on global supply chains, reducing emissions and enhancing resilience to global disruptions. Localisation also encourages people to see the immediate impact of their consumption and production, fostering more sustainable habits. However, it’s important to acknowledge that a complete shift away from globalisation is unrealistic and potentially harmful. The key is to find a balance that prioritises local resilience while still engaging in global cooperation and trade where it benefits all parties involved.

4. Shift to True Cost Accounting

Conventional economic models often ignore “externalities” like pollution, habitat destruction, and greenhouse gas emissions. If these costs were factored into the price of goods and services (through carbon pricing, pollution taxes, or other measures), unsustainable products would become more expensive, and sustainable alternatives would become more attractive. Carbon pricing could take the form of cap-and-trade systems, where a limit is set on total emissions and companies can trade emissions permits, or carbon taxes, where a fee is levied on each tonne of carbon emitted. Each approach has its advantages and disadvantages, and the best choice may depend on the specific context. By incorporating the true costs to society and the environment, businesses and consumers alike would have a clearer understanding of the impact of their choices. However, it’s crucial to ensure that such measures do not disproportionately burden low-income households. This could be achieved through targeted subsidies, rebates, or other forms of social safety nets that offset the increased costs for essential goods and services.

5. Build Resilient Systems through Circularity

A circular economy doesn’t just recycle waste—it rethinks production so that waste itself is eliminated. By designing for durability and reusability, products stay in use longer, reducing the need for constant new resource extraction. In a circular system, “waste” becomes a resource, creating loops within industries where the output of one process becomes the input for another. This requires redesigning entire supply chains and production processes, but it could drastically reduce the ecological footprint of our economy. To support this shift, governments could implement regulations such as extended producer responsibility schemes, which make manufacturers responsible for the end-of-life management of their products, or mandatory recycled content requirements, which create a market for recycled materials.

6. Support Ecosystem Services and Natural Capital

Many economists now recognise the need to factor “natural capital” (like forests, water, and biodiversity) into economic decisions. Forests, for example, provide ecosystem services like carbon sequestration, water purification, and habitat for biodiversity. Recognising and valuing these services—potentially even creating markets for them—could make conservation and restoration financially attractive. For instance, reforesting degraded areas might be seen as an investment in future stability and climate resilience, rather than a short-term expense.

7. Implement Universal Basic Services and Resource Sharing

Ensuring that basic human needs are met independently of the market economy can reduce pressure on the environment. Universal basic services like healthcare, education, public transportation, and housing reduce consumption driven by economic insecurity and foster a sense of shared prosperity. Similarly, a sharing economy that prioritises access over ownership—like community tool libraries, car-sharing systems, and community gardens—could significantly reduce waste and resource demand.

8. Foster Education for Sustainability and Systems Thinking

For these changes to take hold, we need a cultural shift that starts with education. Teaching systems thinking helps individuals see the interconnectedness of economic, social, and environmental systems, encouraging holistic solutions. Education for sustainability at all levels can help build a citizenry that values long-term thinking, understands ecological limits, and sees human well-being as tied to the health of the planet.

9. Redefine Success and Progress at Personal and Societal Levels

Culturally, we need to question and redefine success. Currently, it’s often associated with material wealth, power, and personal consumption. Shifting to a mindset where success is measured by quality of life, mental and physical health, personal development, relationships, and contributions to the community and environment can transform consumer behaviour and reduce the pressures of over-consumption.

Addressing the Challenges of Transition

This transition will undoubtedly face challenges. Some industries may experience job losses as the economy shifts away from resource-intensive and polluting sectors. To address this, a “just transition” framework is essential, providing support for workers through retraining programmes, income support, and investment in new, sustainable industries. This transition will require significant investment and could lead to higher prices for certain goods and services in the short term. It is also important to acknowledge that powerful actors, such as corporations with vested interests in the current economic model, may resist these changes. This influence can manifest through lobbying efforts, campaign contributions, and public relations campaigns that seek to maintain the status quo. Overcoming this resistance will require strong political will, citizen engagement, and the building of broad-based coalitions that include businesses, labour unions, environmental groups, and social justice organisations. These coalitions can advocate for policy changes at local, national, and international levels, pushing for a more sustainable and equitable economic system.

Moreover, this transition must be globally equitable. Wealthier nations have a responsibility to support developing countries in transitioning to sustainable economies through technology transfer, financial assistance, and capacity building. International cooperation through agreements and collaborations will be crucial to address global environmental challenges like climate change effectively.

This is, of course, a significant transition, but it’s not out of reach. By adopting policies like tax breaks for businesses that adopt regenerative practices, subsidies for farmers who transition to regenerative agriculture, and grants for research and development in sustainable technologies and creating economic models that prioritise regeneration, resilience, and well-being, we can cultivate a healthier relationship with the planet. Changes like these would allow future generations not only to survive but thrive in a world that respects both human and ecological needs. It is also important to encourage citizen engagement. Grassroots movements have been instrumental in driving social and political change throughout history. By mobilising public support and demanding action from elected officials, citizens can play a vital role in shaping a more sustainable future.