Degrowth Group Assembly Process

Introducing the Not-for-Profit World Economic Model

Title
Publication TypeConference Paper
AuthorsMaclurcan, D, Hinton, J
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Very interesting. Thank you.

Stirring Paper stirs up a lot of questions:

* Can "not-for-profit" be a sufficient criterion?

* Will "not-for-profit" automatically stop e.g. risky &
  destructive investments?

* Can we trust a company like Bupa with Millions of
  customers and 70.000 employees and a straight
  strategy of further growth? What do we have to
  know about their structures and policies?

* It's kind of funny to read about growth of the
  NFP-sector on the degrowth page ;-). The pure
  numbers do not tell anything about emanzipatory
  strategies of the actors, nothing about reasons for
  the increase of the sector (e.g. in the USA you have
  lot of NFP because public sector does not care for
  many basic needs.)

* And last but not least: "not for profit" is in Germany
 e.g. the Bertelsmann foundation. While as a not-for-
 profit foundation they have to accept limitations for
 private advantages - but the whole foundation is a
 neoliberal think tank and influences politics in an
 awful way.

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Thanks so much for your questions, Jutta!
I’m sorry for the long reply, but these are good questions and each one deserves a thorough response.
Please let me know if you have further questions before we meet at the conference.
- Jen
* Can "not-for-profit" be a sufficient criterion?
In short: no. Our main hypothesis is that the not-for-profit ethic, not-for-profit ways of organizing the economy and not-for-profit business structures are necessary but not completely sufficient conditions for sustainability.  We are also saying that it’s absolutely necessary to move beyond the for-profit business models and for-profit ethic in creating a more sustainable future.  The Not-for-Profit World draws a clear line in the sand, saying that greed is not desirable or even acceptable and that we need a system that encourages the flow of wealth throughout the system rather than accumulation in private pockets.  It's an ethic and a model of "enough", whereas the for-profit world we currently live in claims that we can never have enough.  
So, the Not-for-Profit World model we’re presenting is more than a bunch of not-for-profit businesses.  The not-for-profit ethic and not-for-profit ways of organizing the economy play integral roles in creating better social and ecological outcomes.  This model also incorporates other post-growth ideas, like new ways of measuring economic and financial success, shorter working weeks, and de-monetizing economic activity (i.e. - the sharing economy).  The Not-for-Profit World model presents a very realistic, feasible bridge from the economy we have now to all of the wonderful ideas, visions and dreams that are so often discussed in de-growth circles.
* Will "not-for-profit" automatically stop e.g. risky & 
  destructive investments?
The not-for-profit structure definitely cuts down on risky and destructive investments.  Why?  Let’s look at where the incentive for destructive investments currently comes from. Our economic system encourages destructive behavior by allowing individuals to make private capital gains from such investments, in the form of venture capital, the stock market, privately owning a company, high-risk lending at excessive interest rates (the for-profit ethic strikes again), and the promise of getting bonuses from the profit that’s generated. 
None of these things exist in the Not-for-Profit World model.  Profits cannot be privatized, so venture capital and the stock market don’t exist; nor do bonuses from a company’s profits. Not-for-profit companies cannot be owned by individuals, so owners cannot privatize profits.  Not-for-profit banking ensures less high-risk lending and reasonable, low interest rates on loans. 
Investing in the Not-for-Profit World is much more down-to-earth and focused on allocating capital to where it’s really needed in order to meet human and ecological needs.
* Can we trust a company like Bupa with Millions of 
  customers and 70.000 employees and a straight 
  strategy of further growth? What do we have to 
  know about their structures and policies?
Not-for-profit business structures are not a panacea.  Bupa is not perfect, but we definitely feel like it would hold up in a comparison to for-profit healthcare providers of the same size.  It is alarming how many healthcare companies are listed on the stock exchange and therefore have as their top priority profit-maximization.  Bupa’s trying to grow its revenue in order to sustain its healthcare services (it has to reinvest 100% of its profits back into healthcare) and the publicly traded companies are trying to grow their profits in order to pay shareholders.  One of those goals seems more mission-driven and more trust-worthy to me.
So, we do know one thing about its structures and policies and we're arguing that it's an extremely important thing: Bupa and all other not-for-profit businesses cannot privatize any of their profits and, if they close down, no one can privatize any of the company's assets.  
* It's kind of funny to read about growth of the 
  NFP-sector on the degrowth page ;-). The pure 
  numbers do not tell anything about emanzipatory 
  strategies of the actors, nothing about reasons for 
  the increase of the sector (e.g. in the USA you have 
  lot of NFP because public sector does not care for 
  many basic needs.)
It might sound a bit funny to mention growth on a degrowth page, but I think we all want certain things to grow, like the ratio of healthy, generative businesses to extractive, destructive businesses.  And that’s what we’re pointing out with the numbers.  As systems thinkers, we’re very concerned not only about the fact that the number of NFPs is increasing, but also why.  It’s complex and there are many reasons for this trend, but one of the biggest we’ve seen so far is that people feel that the NFP ethic and model aligns with their mission.  They don’t feel the need to privatize profits from the work their doing, so this is the natural choice for them.  
Current cultural shifts are of particular importance to our model.  The trend towards not-for-profit enterprise is co-evolving with trends towards collaborative consumption, voluntary simplicity, sharing networks, conscious consumption, the purpose motive, crowdfunding, community currencies, permaculture, Mother Earth laws; the list goes on.  It’s basically a rapidly growing ecological consciousness paired with a deeper sense of purpose.  These trends are fueled by people who value having a deep sense of purpose in their lives more than accumulating wealth and status markers and are highly connected on the Internet.  They want their life’s work to contribute to the greater good and the Internet makes it easier for them to be ecologically and socially-oriented entrepreneurs than for any previous generation.   These people are fed up with the status quo, and they’re concerned about their ecological footprint.  
* And last but not least: "not for profit" is in Germany 
 e.g. the Bertelsmann foundation. While as a not-for-
 profit foundation they have to accept limitations for 
 private advantages - but the whole foundation is a 
 neoliberal think tank and influences politics in an 
 awful way.
We are promoting not-for-profit enterprise as becoming the primary way in which economic transactions take place in the world.  We so far have hundreds not-for-profit enterprises in our database, all over the world, in economic sectors from agriculture, to manufacturing, to telecommunications.  We do not consider political lobbying groups or most charitable foundations to be enterprises.  
I’m guessing the Bertelsmann Foundation is a non-profit that is dependent on income from big for-profit businesses.  This is exactly the trend we’re hoping to dismantle by promoting not-for-profit enterprise.  The sooner mission-driven not-for-profits can generate their own income, the sooner they can stop being dependent on the for-profit economy that creates so much social and ecological damage.  
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Thanks for your input. Here are my thoughts:

- To the issus of NFP as sufficient criterion or not:
I don't see the automatism why NFP enterpreises don't feel any pressure to sacrifice environmental well-being. For example, in a public enterprise profits cannot be privatized, but this does absolutely not mean that it respects automatically environmental issues. I see the point that in such an enterprise the driver of environmental damage is not proft, but companies interact with the environment in many ways. Reinvesting profits in the company is a good thing, but the essential question is, how the money is invested. Of course profit-orientation is an issue, but for being a company acting towards a degrowth world there has to be a clear focus on sustainability issues, too. In my eyes, the criterion "meeting human needs" leaves to many things vague and allows for interpretations which go into different directions.

- "increasing entrepreneurialism and autonomy in the non-profit sector; and increasing social innovation and entrepreneurialism in the public sector" sounds like increasing marketisation/commodification!?

- Your decription sounds very positiv about the emering NFP world. But is it really self sustaining? What is about the existing power structures of e.g. multinationals? In this regard, the other steering paper from Elisabeth Voß mentions interessting aspects: Resistance against the existing order and building real alternatives. I see the process of building alternatives as continuing experiments about how the good life can be embodied in an enterprise.

- You are mentioning a datebase with NFP enterprises. Is this database somehow accessible?

I'm looking forward to a fruitful discussion in Leipzig!
Dirk

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Can we have a document or weblink where in we know how to build a not for profit organisation. Mainly, I would like to know how to structure the financial flow or model or financial plan for a not for profit and a degrowth organisation.

Mianly if it is a two or three people orgnisation, providing services and products for a huge community (let's say 100 or more houses) and if it is a community organisation of 10 or more people.

Groups audience: 
Solidarity Economy, Cooperatives and Social Business
Open Atrium Section: 
Stirring papers
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