What is The Chrysalis Economy?
Sustainable wealth creation refers to the adaptation of sustainable ways of generation revenues by the companies. A business process is considered sustainable if it fits the triangle of the 3Ps of sustainability: People, Planet, Profit:
People: People here, is referred to the society the company is serving. Eg; ‘people’ for a hotel operating in a town called “A” would be all the residents of the said town. Now the responsibility of the company here remains that they help the town any big or small way that they can.
Be it through donating leftovers to the homeless rather than throwing it all away at the end of the day or employing locals as waiters/bellboys/housekeeping or even significant posts such as managers wherever qualified.
Planet: Planet here, is referred to the nature/surroundings of the company if we address it at a very small scale. Taking the example of the hotel mentioned in the point above, The responsibilities of the company becomes to not litter, not throw their waste/leftovers in open spaces, or cut down the surrounding parks just to “increase the parking space”.
Profit: The main purpose of starting most companies is to earn profit.
There are no particular certifications that an organization can get. However, there is an ISO standard called ISO 26000. This standard includes guidelines and processes that one can follow to ensure sustainable wealth creation.
**Read more about it in the part 2 of the blog.
Source: “The triple Bottom line: does it all add up” by Adrien Henriques
There are 4 categories that the organizations fall into which is called the “Chrysalis Economy”.
The chrysalis economy refers to the 4 stages an organization goes through or fits into one of them:
- Corporate Locust
- Corporate Caterpillar
- Corporate Butterfly
- Corporate Honeybee
A corporate locust are the organizations that fall under the operating world of ‘decreasing returns’, which means these corporates destroy everything in their way to achieve high profit, completely disregarding the triple bottom line of sustainable wealth creation.
Among others, the key characteristics of these corporate sare:
- Destruction of humans, animals, nature and competition by complete exploitation resulting in local or even global effects.
- “Swarming” is one of the biggest tell tales of these corporates. One of the biggest examples of swarming can be the gold rush of Dawson city.
- The only purpose of these corporates are wealth creation, no matter the implications.
- They are incapability to foresee the repercussions or their operations which ultimately results in a short lived business and a bad reputation.
A Corporate Caterpillar is an organization that is generally harder to spot since their impacts are more localized unlike a corporate locust whose impact is more global.
However, if you live close to a corporate caterpillar, you’d feel the pressure and inconvenience quite vividly. These corporates operate in sectors where older, more established corporates have already shown a remarkable growth through sustainable ways of operating, but a corporate caterpillar still chooses to go the more unsustainable route.
Following are some tell tales:
- Mostly the impacts are more localized compare to it’s counter parts.
- Similar to corporate locusts, these corporates have a short lived reputation.
- They have the potential to turn sustainable.
- Focus is only on wealth creation and profits, no matter the implications.
A Corporate Butterfly is an organization who have a more sustainable model, however, have the potential to turn less sustainable as they grow. Constantly in the eyes of media eg; ben & jerry’s, The body shop.
- They have a very strong commitment to CSR and sustainable development.
- Have a very sustainable business model
- Have a very high visibility & role model to corporate caterpillars.
A Corporate Honeybee is the epitome of a sustainable business model, mostly includes government projects & corporates dedicated towards finding sustainable & innovative ways to achieve the utmost sustainability. They run completely on sustainable models and have government support to do so.
These corporates lead the way for corporate locusts and corporate caterpillars to become more sustainable along with corporate butterflies.
In conclusion, It is not only a corporate’s responsibility to create a sustainable model and stick to it, the government along with the governing bodies to keep in mind the capabilities of startups entering the market and give them enough time to at least break even before allocating budgets for CSR, CD, ISR etc.
By considering companies with not a lot of profit/revenue while passing guidelines rather than creating “one size fits all” standards.