We use markets every day in our lives—they are places where buyers and sellers meet to exchange goods and services. A neighborhood farmers’ market is a market, as is Amazon or Alibaba. It is through that interaction between buyers and sellers that prices are determined for goods and services which, in turn, impacts the forces of supply and demand. While we most often come in touch with the endpoint of a market (the grocery store or a shopping mall), supply and demand are what drives how goods and services are invented, made, priced, and mass-produced throughout the world.
While markets have been around since the earliest days of mankind, today’s markets do not reflect the reality of our world—nearly eight billion people living on a planet with resources nowhere near able to provide the decent quality of life that all of us want and deserve. Thus, we need to reimagine how markets work and how they foster the creation of goods and services consumed by each of us.
As I noted in my book, Transformative Markets, this new type of market must be sustainable. That means markets must produce goods and services in a way that respects the natural, human, financial, and social capital that goes into production so that it provides a net positive to society rather than being a drag on precious resources.
A sustainable market can range in size and scope from food grown and sold in a community cooperative all the way to those established by Fortune 500 corporations such as Unilever and Tesla that have supply chains and consumers all over the world.
A company that makes a highly pollutive product containing chemicals that pose harm to consumers while paying its employees the lowest possible wages is not a sustainable company, nor are the products it sells on the market.
Examples of Sustainable and Unsustainable Markets
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Small-scale Sustainable Markets |
Small-scale Unsustainable Markets |
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Large-scale Sustainable Markets |
Large-scale Unsustainable Markets |
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In looking at the products made in sustainable markets, we can see that they meet the most commonly accepted definition of sustainability was established in 1987 in the World Commission on Environment and Development’s Brundtland Report: “Meeting the needs of the present without compromising the ability of future generations to meet their own needs.” The production of goods and services in the sustainable markets are not hurting our ability to meet the needs of future generations.
Conversely – the production practices of the unsustainable markets are detrimental to our future. Yet, those markets still flourish. Future blog posts on SystemChangr will explore that perplexing – and unfortunate – reality.
Bob Ludke, Co-founder/CSO, systemCHANGR