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A Road Map for Natural Capitalism (HBR Classic)
by: Amory B. Lovins, L. Hunter Lovins, Paul Hawken

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Binding: Digital
Format: Download: PDF
Label: Harvard Business Review
Manufacturer: Harvard Business Review
Number Of Pages: 16
Publication Date: July 01, 2007
Publisher: Harvard Business Review
Release Date: October 25, 2008
Sales Rank: 1620732
Studio: Harvard Business Review

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No one would run a business without accounting for its capital outlays. Yet in 1999, when this article was originally published, most companies overlooked one major capital component--the value of the earth's ecosystem services. It was a staggering omission: Calculations at that time placed the value of those services--water storage, atmosphere regulation, climate control, and others--at $33 trillion per year. Not accounting for that cost has led to waste on a grand scale, the authors maintain. This article shows how a few farsighted companies, like DuPont and Xerox, were able to find powerful business opportunities in conserving resources on a similarly grand scale. Their early embrace of natural capitalism is even more important to emulate today. Natural capitalism comprises four major shifts in business practices. The first involves dramatically increasing the productivity of natural resources--by as much as 100-fold. In the second stage, companies adopt closed-loop production systems that yield no waste or toxicity. The third stage requires a fundamental change of business model--from selling products to delivering services. For example, instead of selling light bulbs, a manufacturer sells lighting services, with both the seller and the customer benefiting from the development of extremely efficient, durable bulbs. The last stage involves reinvesting in natural capital to restore, sustain, and expand the planet's ecosystem. Because natural capitalism is both necessary and profitable, it will subsume traditional industrialism, the authors argue, just as industrialism subsumed agrarianism. And the companies that are furthest down the road will have the competitive edge.

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