Regenerative ownership re-balances the benefits of ownership between you, me and us in an equitable way by replenishing human and natural capital and reconnecting wealth creation with the common good.
Rather than focusing on individual companies or the ethical largesse of individuals for a solution to the systemic financial and economic issues we face, this new architecture focuses on building a parallel and expanding economic system as a sub-zone within the market.
The vehicle for delivering and scaling a system of regenerative ownership and distribution we call a Commons Corporation because it is designed to expand and protect “all things that we inherit from nature and civil society, which we are duty-bound to pass along, undiminished, to future generations” (1)
It involves an enterprise network of companies linked through a new organisational architecture to deliver a space between public and private ownership that has the best of both worlds within the free market, independent of government and within existing legal structures.
It comprises an economic eco-system of inter-related organisations that are linked through a balanced hierarchy of relationships and rules of operation and engagement, that crucially separates power from profit and thereby decisions about business from decisions about civil society and the environment . This frees enterprise and frees communities to invest in what is important to both.
The structure delivers regenerative distribution from a continually expanding share of surplus by means of a democratically governed Commons Trust which supports civil society organisations in developing human capability and ecological flourishing. At the same time it invests equally into an Economic Development Fund to bring more companies into the system thereby expanding the number of people involved and the surplus to be distributed by the Commons Endowment Foundation Trust.
Our organisational structure adheres to three simple rules
1. Economic wealth generation that directly and indirectly meets the needs and desires of the other, which in its essence is about serving the other. It’s all about you.
2. Services that nurture, heal, educate and cultivate the human being – body, soul and spirit. These services, such as education, health and the arts, are about the individual’s development and wellbeing and should, in an ideal world, be provided without cost. In our less than perfect world they should at least be non-profit. It’s all about me.
3. Agreements and rules about how we arrange things, an area in which equality and environmental sustainability are everything. It’s all about us.
In order to progress this vision we are in the process of establishing a Regenerative Development Fund at the heart of the Elysia Commons – our pilot Commons Corporation. The fund will be at the centre of a network of integrated organisations (both for-profit and not-for-profit) within an umbrella, hard-wired, rules-based, economic eco-system that invests in existing and new companies and organisations that become members and that distributes surplus in a way that supports the whole.
Three Generative Cycles of Stability, Expansion and Investment
The wealth generated through the mature companies within the Commons is shared three ways to drive three virtuous cycles of community development and so does not accumulate in the pockets of a very wealthy few. Not that “being wealthy” is wrong, it isn’t, and there is ample opportunity for an individual to develop moderate wealth through releasing non-corporate organisations into the Commons, from Commons based corporates paying fair and high salaries to their top people, and because 30% of the surplus will always go back to the people who made it establishing a generative cycle of financial motivation. You can see a diagram of these 3 generative cycles here.
A further 30% will flow back to the equity fund to drive continued economic expansion of the commons by investing in new and member companies in a second generative cycle of community development that creates a perpetual impact investment fund.
Another 30% will flow to a community development foundation that supports a network of not for-profits and which builds the capacity of the community and the whole system to support all it’s members’ self development and the human and environmental capital that serves the whole in a virtuous cycle that develops future capacity, capability and wellbeing.
The final 10% will be used to administer and promote the whole system.
Fulfilling the Principles Of A Regenerative Economy
Although their report came out after we had designed the Elysia model, the 8 principles of regenerative capitalism identified by John Fullerton of the Capital Institute in the report ‘Regenerative Capitalism, How Universal Principles And Patterns Will Shape The New Economy’ April 2015, are integral to the Elysia Commons architecture.
1. Right Relationship – designed to protect and build the human and natural commons
2. Holistic View of Wealth – seeing human and natural capital as part of the whole
3. Adaptive, Responsive & Innovative – developing creativity and innovation within the network
4. Empowered Participation – creating resourced coherence, individual and democratic agency
5. Honouring Community & Place – contextually and thematically based
6. Edge Effect Abundance – incorporating organisational diversity and freedom to fail within the network
7. Robust Circulatory Flow – three generative cycles of surplus distribution
8. Seeks Balance – structured collaboration, freedom to compete and distribution of wealth are built into the system
- Through an automatically expanding network it links and grows oases of the new economy into an expanding functional landscape
- Builds a community wealth management system that invests in people and nature
- Gradually builds an independent banking system whose purpose is to serve and invest in productive social enterprise, civil society and the environment
- Fills and fulfils roles currently undertaken by government that communities and social enterprise can do better
- Augments and empowers community alongside existing civil society organisations
- Creates a predictable, consistent enabling environment for individuals communities, businesses and civil society organisations in the network
- Builds confidence economically, psychologically and culturally in a broad base that allows for diversity and inclusion of all
- Delivers enhanced social impact in communities, across localities and regions by resourcing localised decisions for investing in social initiatives
- Builds businesses as engines of change that can scale and create resourced coherence across larger geographical or interest communities
- Develops a new culture and economic activity to address issues on a larger scale in terms of inequality and the environment
- Profits are shared proportionately to earnings with the co-workers and managers that help make the surplus
- The ratio between top salaries and bottom salaries is controlled by a community based mechanism
- The regenerative equity fund (a putative commons investment bank) at the centre reinvests all it’s profit and works 100% for the benefit of the community
- There is funding for not-for-profits
- The whole is a community that democratically manages itself.
- Wealth doesn’t accumulate in the hands of the few but is continually spent on the community
- Hidden social and environmental costs in the ‘free’ market are shared
- Increases stability of employee owned companies and supports new entrepreneurship
- Predictable, consistent building legitimacy and confidence socially, economically and politicall
1) David Bollier- www.renewal.org.uk/articles/a-new-politics-of-the-commons
2) John Fullerton – www.capitalinstitute.org/wp-content/uploads/2015/04/2015-Regenerative-Capitalism-4-20-15-final.pdf