What ancient wisdom can teach companies about sustainable economics

The business world tends to prioritize the concepts profit maximization, economies of scale and the weight of shareholder value. As the industry has evolved over centuries, these concepts have become deeply embedded in global financial systems.

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However, some companies in some parts of the world operate based on respect for all living things, not just humans – especially in countries that adhere to dharmic religions such as Jainism and Hinduism (mainly across the , Southeast and ). Learning about such ways of working can help the global business world become more sustainable and address the climate crisis.

Research shows that nature has long been treated as a resource or something “outside” the economic system, which exists for the benefit of humans. But the fact that the number of species becoming extinct as a result of human activity is at least 1,000 times the natural rate shows how interdependent humans and nature are. The operations’ effects on our climate are also clear, with 71%of the world’s emissions come from just 100 multinational corporations.

Addressing this attitude towards nature in much of the business world would require change economic theory and belief system to recognize the sentience of all life on earth and the need to protect other living beings. This would require a profound behavioral and cultural transformation to meet the environmental challenges facing the world right now.

But economics and finance professionals often remove this question from their equations, contributing to social and ecological devastation. The growing global green finance movement is certainly a step in the right direction, but more radical changes in financial theory are required to address the environmental crisis and make all business more sustainable.

Religious inspiration

My research shows how finance can tap into some ancient religious traditions to encourage such behavioral and cultural changes. Indeed, there are many belief systems that do not separate nature from humanity, but rather encourage its preservation. Companies can follow such doctrines and still be successful.

Dharmafor example generally understood as moral virtue and outlines a path towards a sustainable life. ’s dharmic religions – the Hindu, Sikh, Buddhist and Jain belief systems – have never separated man from animals and nature. These belief systems were never anthropocentric (regarding humans as central to life on earth). Their traditions go back thousands of years and were formed long before humanity faced the existential crises we do now.

What is even more prescient about these ancient religions, especially for the world of business and finance, is that their sustainable practices are actually hiding in plain sight. Their leaders are already doing business in a sustainable way, simply because they have always seen it as the right way to operate – their motivation is driven by culture, faith and tradition.

Jains, for example, have for thousands of years believed in respect for all living things including plants and animals. The central philosophy of Jainism – one of the world’s oldest religions – is called Ahimsa and is based on non-violence in thought, word and deed.

During my research, I interviewed several prominent Jain business leaders who follow this way of thinking, including Vallabh Bhanshalico-founder of Indian investment firm Enam Securities Group and Abhay Firodiachairman of the Indian car manufacturer Force Motors and whose Father invented Asia’s most popular affordable transport vehicle, the auto-rickshaw.

For many Jains, as well as those of other dharmic religions such as Sikhs and , philanthropy is “a duty not a choice“. They aim to within the nature and limits of money to practice a compassionate form of .

But this attitude is not limited to dharmic religions. Research shows that before colonization many parts of Africa used strong social and communal networks of shared ownership.

And the Swedish bank Handelsbanken was founded in 1871 to operate organically by building trust and relationships that are local and sustainable. It provides essential funding to smaller businesses that may be neglected by major banks.

Beyond economics

Economics has often been one destructive force in communities, society and nature. It promotes individualism and can cause inequality instead of cooperation and income parity.

Ignorance of the multiplicity of capitals beyond the financial – culture, relationships, trust, leadership, spirituality and community capital – and their importance in building contented and harmonious societies, could be remedied by looking to these other, ancient traditions. Learning about these other types of capital can help revive and elevate their importance in the business world.

Read more: Beyond GDP: changing how we measure progress is key to managing a world in crisis – three leading experts

Faith was central for financing for thousands of years – even the City of London had 104 churches before the world wars – but it is often ignored in contemporary financial research and education. By making business education much more inclusive of different cultures and wisdoms, more industry leaders can learn to work with conscience, contentment and responsibility.

Author: Atul K. Shah – Professor, Accounting and Finance, City, University of London The conversation

Source: sn.dk

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