The Frugal Economy, Part 4:
Regenerating People, Places and the Planet

To effectively address the urgent human, socioeconomic and environmental challenges of our era, businesses can’t just focus on sustainability — they must evolve into regenerative businesses that positively impact society and the planet.

Brand Provided | By Navi Radjou | Published 13 hours ago | About a 12 minute read

Image: Appalachia's Great Smoky Mountains | Robert Broderick

Two surveys conducted by ReGenFriends in 2019 and again in 2020 showed that almost 80 percent of US consumers prefer “regenerative” brands to “sustainable” brands. Co-founder Nils-Michael Langenborg told me why: “Aware of the climate emergency, buyers — especially young people — want companies to go well beyond sustainability. They find the term sustainable too passive. They demand that businesses take inspiration from nature and build a virtuous, regenerative economy based on renewal, restoration and growth (the three essential qualities of all living systems).”

Businesses need to take inspiration from nature in order to transition to a regenerative model.

In her uplifting TED talk, “How trees communicate with each other,” Suzanne Simard — a forest ecology professor at the University of British Columbia — reveals how nature is altruistic, a trait not associated with the cutthroat corporate environment. Forest trees generously exchange information and nutrients through an extensive network of soil fungi.

Imagine if businesses reinvented their value chains and business models to function in a selfless manner similar to a forest. They will then operate as regenerative businesses that contribute 10x and even 100x more to society and the planet than they consume. To borrow organizational psychologist Adam Grant’s analogy, businesses can evolve from “takers” to “givers.”

How companies around the world are 'doing better with less'

Join us as Navi Radjou shares more insights and case studies about the frugal economy and its already transformative impact on businesses, industries, communities and the environment — at SB'24 San Diego (October 14-17).

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A sustainable business aims to minimize its ecological footprint. On the other hand, a regenerative business consciously strives to expand expand its socio-ecological handprint by enhancing the wellbeing and sustainability of communities and the environment, as described by Gregory Norris, director of SHINE — a joint MIT/Harvard project. By doing this, regenerative businesses can attain better financial results and influence compared to their peers focused on sustainability.

Regeneration is still a developing paradigm. Currently, there is no universally accepted definition for what regeneration truly entails. Therefore, regeneration today is polysemic (it continues to have multiple meanings as a concept), polymorphous (it is applied in various ways in practice), and polyvalent (it produces varied results in term of impact).

Rather than waste time defining what regeneration is, we should explain what it does. This is vital in our capitalist system which — due to its reductionist thinking and profit motive — tends to hijack and essentialize broad concepts and apply them in a selective, narrow and superficial fashion to achieve maximum financial gain.

For instance, the circular economy paradigm exhorts companies — in principle — to reduce (production and consumption), reuse (resources), and recycle (waste). Yet, in reality, most so-called “circular businesses” mainly concentrate on recycling waste to create new products and increase sales — rather than encourage customers to reduce consumption and reuse existing products by, for instance, sharing them. To make it worse, most academic case studies and mainstream media articles keep conflating “circular” with “recycling” — further diluting the huge potential and broader impact of a circular economy.

If we want the fledging regenerative economy paradigm to not incur the same stunted fate as the circular economy, we must showcase the breakthrough best practices of pioneering firms and communities worldwide that apply regeneration in the broadest sense to create a wider and deeper social, economic and ecological impact.

In the past ten years, I researched and interviewed dozens of vanguard businesses and cities worldwide that are practicing regeneration in a comprehensive and deeply meaningful way. By studying these pioneering initiatives, I gleaned three “must-do” insights on how to practice regeneration intentionally to maximize positive impact on people, places and the planet.

Regeneration must complement and augment sustainability

Regeneration is by no means superior to sustainability. Sustainability and regeneration are not two rival concepts. Rather, they complement and mutually reinforce each other. Sustainability and regeneration are synergistic and symbiotic.

A regenerative business increases its socio-ecological handprint while reducing its ecological footprint | Image credit: Navi Radjou

In the graphic above, the stacking of the Plus above Minus does not denote a hierarchy.

Indeed, a regenerative business does better with less: It revitalizes and grows people, places and the planet (Plus); while also enabling sustainability by curbing emissions and waste, and reusing and recycling scarce resources (Minus). By doing this, regenerative companies could achieve higher financial success and greater impact compared to their peers focused solely on sustainability.

Take, Natura — a world-leading, Brazilian cosmetics brand and sustainability pioneer. Since 2007, Natura has been 100 percent carbon neutral, by both reducing and offsetting emissions. By 2023, it had reached 86 percent circularity in its packaging and 95 percent biodegradability in its products, and it aims to achieve net-zero emissions by 2030. As part of its Commitment to Life strategy, Natura aims to not only fight climate change by becoming net-zero but also protect the Amazon and regenerate its indigenous communities and natural ecosystems.

Here is an example of how Natura is conserving and regenerating the Amazon’s ecological and socio-cultural biodiversity. The indigenous tribes used to cut down a palm tree called murumuru that grows in the Amazon and used its wood to make commodity goods such as brooms. Apparently, we can obtain a highly moisturizing butter from the seeds of this palm tree that effectively repairs and rejuvenates damaged hair — so, the value of these seeds is seven times greater than that of the wood from this palm tree. Therefore, it would be seven times more advantageous for the Amazon Indians to keep this remarkable palm tree alive instead of chopping it down!

So, Natura began collaborating with the tribes to incorporate their traditional farming methods in order to ethically harvest murumuru butter for use in a variety of hair care products. Through this mutually beneficial partnership, Natura is regenerating indigenous communities financially (by increasing their income opportunities), culturally (by honoring and utilizing their ancestral agricultural practices) and environmentally (by safeguarding the biodiversity of the Amazon and its rainforests — the historic land of indigenous populations and the world’s largest carbon sink).

Regeneration must enhance people and places, as well as the planet

I would like to clarify my emphasis on the human aspect of regeneration. I view myself as a humanist before being an ecologist. I worry that in today’s fast-paced, hyper-connected world, our overburdened nervous system may collapse well before our overextended ecological or social systems.

As Korean-German philosopher Byung-Chul Han pointed out, we currently live in “the burnout society.” As such, before we end the plundering of our scarce natural resources, we need to stop over-exploiting our mind, body and psyche to death. In addition to reducing the wealth gap between the affluent and the less fortunate, we need to start closing the internal gap between our desire-driven ego and our estranged soul.

In my upcoming book, The Frugal Economy, I humanize the field of economics and show how nascent paradigms such as the regenerative economy can truly contribute to “mass flourishing” — a term coined by Edmund Phelps, winner of the Nobel Prize for Economics.

Most people, however, don’t live in isolation. They work, interact and reside in a physical place. Regrettably, in dualistic Western societies, we not only perceive humans as separate from nature — we also see ourselves as different from the physical environment where we dwell. We need to redeem the role of places in our society and become fully conscious of where we live. We must enact place-based and place-sensitive economic-development strategies to regenerate the left-behind cities that have struggled to adjust to globalization in the 1990s and the tech revolution since 2000.

Consequently, we need to expand the concept and implementation of regeneration beyond just the ecological aspect and also include people and place. I refer to it as triple regeneration — a holistic approach to boosting the wellbeing of people, places and the planet synergistically.

Triple regeneration is a holistic approach to revitalize people, places, and the planet synergistically| Image credit: Navi Radjou

I invite you to read my inspiring case study in Stanford Social Innovation Review to learn how left-behind places in the US and Europe can adopt a triple regeneration strategy to renew, restore and grow their people, places and the planet synergistically.

Regeneration must fuel healthy growth for all

Today, there is a raging debate between hard-core ecologists who advocate degrowth and die-hard capitalists rooting for hypergrowth. Sadly, both are deleterious concepts. In The Song of the Cell, Pulitzer-winning physician and biologist Siddhartha Mukherjee explains that the trillions of cells in our body eschew both hypergrowth — which, if left uncontrolled, would catalyze lethal cancer — and degrowth, which would result in our physical and mental decline and lead to death. Rather, our wise cells use discernment and grow selectively to maintain our optimal health.

We all agree that the current growth model is failing because it heavily pollutes and exhausts natural resources, leading to climate change; and leaves people out, aggravating social inequalities. We should, however, be careful to not throw the “growth baby” out with the bath water. Rather than debate on how to increase or decrease the quantity of economic growth — as proponents of hypergrowth and degrowth do — we must vie to improve the quality of growth, as our cells wisely do, for all.

We need to adopt Nobel Prize-winning economist Amartya Sen’s “capability approach” to unlock the potential of all individuals and communities in our society. This will empower them to contribute to and benefit from a new kind of economic development that maximizes the potential and wellbeing of everyone while respecting our planetary boundaries.

Specifically, we need to implement a regenerative development model that fosters human development, enhances social and ecological harmony, and guides us towards a conscious society. By partaking in — and intentionally shaping — this positive growth cycle, businesses could fulfill a noble purpose that goes beyond just making profit.

Regenerative development balances economic activities with human development and social and ecological harmony, leading us to a conscious society | Image credit: Navi Radjou

The left-behind places in the US and Europe failed to capitalize on the hypergrowth fueled by new technologies and globalization over the past three decades. These disadvantaged communities can embrace place-based, regenerative development as a generational opportunity to restore, renew and grow their devitalized people and enhance local natural ecosystems.

Reimagine Appalachia (RI) is a cross-disciplinary coalition of policy experts, community leaders and labor organizations from Kentucky, Ohio, Pennsylvania and West Virginia who have created a plan for the regenerative development of the region. As RI notes: “(For centuries), the Ohio River Valley of the Appalachian region has fueled the prosperity of other regions while we have suffered. Many of our communities rank in the bottom 10 percent nationally for their high unemployment and poverty rates and low incomes.”

To reverse this trend, RI is drawing in both public and private investments for regenerative development projects — which will retrain fossil fuel workers for clean energy and green manufacturing jobs and facilitate an equitable transition in Appalachia.

These environmentally friendly, job-creating projects aim to repair harmed lands and waters, upgrade the power grid and boost its local ownership, expand decentralized clean energy production, boost clean manufacturing (ex: electric vehicle and ‘green locomotive’ production), create a sustainable transportation system, revive wetlands, support regenerative farming and eco-tourism that will employ minorities, and capture carbon emissions with natural environments.

Amanda Woodrum, co-director of RI, told me that RI’s regenerative objective is to heal and restore the people and the land in Appalachia, revive its economy, and create enduring local prosperity by innovatively utilizing the region’s existing natural, physical and human resources.

To effectively address the triple urgency of our era — the collapse of the human psyche, exploding social inequalities and worsening climate change — businesses can’t just focus on sustainability. They must evolve into regenerative businesses that positively impact society and Earth. By boosting the health and vitality of people, places and the planet synergistically, companies can catalyze regenerative development that includes and benefits everyone.