Planetary Business Plan
By Joshua Brown Article published August 29, 2006
The president of Earth Inc. smiles at the assembled board of directors. After two weeks of hard work, the completed business plan, bylaws, and mission statement sit in a stack on the large table. “We have articles of incorporation,” he says. All the vice presidents clap.
Is this the start-up of a new landscaping company? A scene from a dystopian novel about the takeover of the world by a mega-corporation?
Neither. It’s a class. The president is Robert Costanza, the Gordon Gund Professor of Ecological Economics, the vice presidents and board members are students from UVM and the Vermont Law School, and the Earth is now a legally recognized corporation.
“We have 10 founding members [the students in the class],” says Matt Sayre, a UVM graduate student — and, now, Earth Inc.’s vice-president for operations. He continues with a hint of a smile, “which means we have 6 billion open seats.”
Next stop NASDAQ?
Walking on the boundary between role-playing and reality, between political theater and gritty problem solving, the students in Costanza's "Earth Inc." summer course meet each day to ask questions like: If the earth were a business, how should it be structured? Who are the shareholders? What would the planetary balance sheet look like if we include “natural capital” (such as clean water and pollination services), and “social capital” in the form of communities, trust, and democracy?
While the class is a “lively thought experiment,” notes Peter Van Schaick, a local attorney auditing the course, the students’ work to create a company that would continue to promote these kinds of questions is not merely an academic exercise. Under the motto, “redefining profit for a sustainable future,” the articles of incorporation are official and legal in the state of Vermont.
“Human activities on planet Earth,” Costanza notes, “are like a ship at sea with no one at the helm, or a corporation with no management.”
“We’re seriously asking: could we claim the common property assets of the world — the public spaces, open ocean, ecosystem services — on behalf of all the shareholders of Earth Inc., which is everyone on the planet,” Costanza says.
“We’re working outside the box,” he says. “Usually people claim rights over things as private property, but we don’t want to claim it as private property, we want to claim the global commons as public property — as stewards for the public.”
An ongoing effort
For now, the traditional assets of the company are the $75 that Costanza donated to pay the secretary of state’s fee for filing paperwork. But most of the students have volunteered to continue with the effort beyond the Aug. 3 end of the course and make Earth Inc. into an ongoing nonprofit company affiliated with UVM’s Gund Institute for Ecological Economics.
Tapping on laptop computers amidst a clutter of Starbucks water bottles, Silk Creamer, and Dunkin’ Donuts wrappers, the students wrestle with the odd juxtaposition of how their tiny company can take on global problems. Shane Neldner, a Vermont Law School student, asks, “How do you make an organization where it’s all of us?”
Earth Inc’s first project will likely be to issue a “shareholders report,” a glossy assessment of the well-being of the planet using the lexicon of the corporate balance sheet and annual report. Targeted at businesses as well as environmental groups, the report will present a quantified estimate of the value of the earth’s natural, social and built capital that extends beyond conventional measures like GDP.
But legal action may be part of their strategy too. “Claiming all the common assets of the planet for all of the people of the planet is a significant reframing of property rights that might well be controversial, but not be without legal justification,” Van Schiack contends. “Consider the alternative: continuing to allow corporations to ‘ride for free’ by using those assets without paying a penny.”
Assessing the value of corporations is a fundamental tension within the course. On the one hand, Costanza chose Gangs of America as a key textbook; this critique by Ted Nace argues that the rise of large corporations in the 19th and 20th centuries has led to the “disabling of democracy.”
On the other hand, “we all agree that we aren’t anti-business,” says Sayre, who started and co-owns a “green” commercial cleaning service. “I think everybody in the course recognizes that corporations perform an important function in society. It’s just that some of the things that corporations are doing are…” and here he pauses to carefully select the next word, “…uneconomic.”
And how did Earth Inc. itself gain permission from the state of Vermont to form?
“Generally, the states are loose about chartering corporations, the result of a century-old ‘race to the bottom,’ [to attract companies and their tax revenue],” Van Schaick answers. Chartering Earth Inc. was a “no-brainer,” he says, “because the standards are so meaningless. Functionally, there is no state supervision [of who can form a corporation].”
Except for the name. “Before we get final approval, we may need to change the name to Planet Earth Inc.,” says Costanza, “because the state said there are a lot of other companies with Earth in their name. We’ll have to wait and see. They said ‘why don’t you be “Earth something” too?’ I said, ‘we’d rather just be Earth.’”