Sustainability 4.0

January 19, 2017

Sustainability 4.0 implies the empowered co-creation of prosumers in order to re-shape economy and society towards social inclusiveness and ecological soundness.

The combination of sustainability and digitalization for solving environmental, social and economic problems seems both promising as well as old hat. Most of us remember the 1980s and 1990s with their call for ecological modernization, not to be confused with the ecomodernists of today. If the digital revolution can be sustainable, moreover, if it can become an enabler for a more sustainable worldremains up in the air. With the term ‘Sustainability 4.0’ I intend to provide a conceptual approach to these issues that hopefully goes beyond smart metering or energy efficiency while, at the same time, avoiding the voluntarist delusions of green growth proponents and ecomodernists.

Everything is sustainable 

Sustainability is everywhere and everything is sustainable. In its humble beginnings, often dated back to the 17th century and forestry – the infamous royal Saxon accountant Hans Carl von Carlowitz rears his head in every boring introduction to the topic –, sustainability is nothing more than a conservation principle for renewable resources: only take as much in a given time that can be replenished in the same time. Abstracting sustainability from a mere rule of thumb for harvesting, we can reconstruct it as an imperative: Use a resource in such a way that it remains available to yourself and others in the long term. This sustainability imperative transcends natural resources and extends to social resources as well. Use trust that others have in you in such a way that it remains available to yourself and others. Play with it, it is good fun. On a more serious note, sustainability then always had a certain moral category to it, which became the dominant understanding of the concept of sustainable development in the Brundtland Report of 1987. The most commonly cited definition of sustainable development is thereby an

“…development that meets the needs of the present without compromising the ability of future generations to meet their own needs. It contains within it two key concepts: the concept of ‘needs’, in particular the essential needs of the world’s poor, to which overriding priority should be given; and the idea of limitations imposed by the state of technology and social organization on the environment’s ability to meet present and future needs.” [Chapter 2, Introduction]

In this understanding, sustainability is a specific form of justice or equity – between generations (in time) and within generations (in space). The fruitless sophistry in drawing a difference between sustainability and sustainable development is addressed within the Brundtland Report insofar as it refers to both concepts without restraints in an interchangeable way. The principles of sustainability are laid out in the definition of sustainable development and only such a development can be sustainable. In the same timeframe of the late 1980s to the mid-1990s, another perspective on sustainability emerged: the notion of a triple bottom line. Coined by John Elkington in 1994, the general idea dates back to Edward Barbier and his work on ‘The Concept of Sustainable Economic Development‘ from 1987:

“Sustainable economic development .. argues that ‘real’ improvements cannot occur unless the strategies which are being formulated and implemented are ecologically sustainable over the long term, are consistent with social values and institutions, and encourage ‘grassroots’ participation in the development process.” [p. 109]

Thus the Venn diagram of sustainability was born, the three intersecting circles of economy, ecology, and society, with sustainability marking the particular intersection of all three circles in the middle. In this regard, sustainability becomes a broad, all encompassing economic paradigm for a sustainable society. As it is more and more akin to a universal human right and a key idea of human political, economic and ethical life, we follow Andy Stirling in capitalizing Sustainability in order to distinguish it from more common say uses as in sustainable finance and the like.

Everything is connected 

When we focus our attention on ‘the digital’, we have to distinguish between digitization and digitalization. Digitization is closely tied to the technological core of computer and information science, the transformation of continuous quantities into discrete quantities. If we want to be precise in language, we would reserve the term ‘quantity’ exclusively to the discrete/digital realm and refer to the continuous/analogue as ‘quality’. Digitization invokes quantification and quantification reduces complexity, thus increasing storage and computational possibilities for information dramatically. In essence, digital products are some form of software or another: the operating system running on a computer or a mobile device; the data stored and processed on and between these devices; digital processes like videochats, electronic supply chain management, or eGovernment. Digitalization is digitization beyond technology. It means taking digital technology into every aspect of an organization, turning digitization into an organizing principle itself: interconnected value creating processes within and between organizations, decentralization, and swarm organization. The boundaryless organization, the starfish organization, the heterarchy: all these dreams of organizational theory can now come to life thanks to digital technologies.

Of course, digitalization is not just about new ways and forms of organizing an economic value chain. It takes digital technologies into our lifeworlds, to borrow a term from Jürgen Habermas. When we ask (especially young) people, what makes ‘digital’ so special, the most common answer is: ‘everything is connected.’ Connected work, connected consumption, connected leisure, connected life. But that is not a passive form of entanglement into the web of digital technology; moreover, it marks the emergence from passivity to activity, from consumption to co-creation. In 1980, Alvin Toffler coined the phrase ‘prosumer’ to describe:

“… people who produce some of the goods and services entering their own consumption. They can be found making their own clothes, cooking their own food, rearing their own cars, and hanging their own wallpaper. All of these services could be purchased in the marketplace and in fact, most people today purchase these goods and services from others. This is the essence of being a consumer. The essence of being a prosumer, on the other hand, is to prefer producing one’s own goods and services.” [p. 510]

Ivan Illich’s notion of conviviality and autonomy in interdependence rings through here as well. The rise of the DIY movement (do it yourself), its new form as DIT (do it together), notions of open innovation or user innovation show that the fundamental principle of digitalization, in fact the fundamental principle of a digital economy is co-creation. Co-creation and thus interconnected self-production or prosumerism is thereby an empowering principle, turning the digital economy into an economy of (potential) self-empowerment of formerly more passive economic actors. The transaction costs are shrinking to zero, digital technologies and the skills to use them are ubiquitous and the question of Ronald Coase – why do firms exist? – needs new answers.

All together now

What is Sustainability 4.0? It borrows of course from Industry 4.0 which is nothing short of the fourth wave of the industrial revolution characterized by a range of new technologies that are fusing the physical, digital and biological worlds – and many more buzzwords, amongst them the internet of things, advanced manufacturing, smart anything everywhere and so forth. For Sustainability the ancillary ‘4.0’ opens up two dimensions. The first is an understanding of Sustainability as an evolving concept that has reached a new stage in its history. From a conservation principle (Sustainability 1.0) to an equity principle (Sustainability 2.0) to a socio-economic paradigm (Sustainability 3.0) to a key idea of human development itself: the foundation of what Karl Polanyi once termed ‘The Great Transformation‘. Sustainability 4.0 in this view is then the evolution of Sustainability as a general principle of society, a more and more dominating mindset how to frame political, social, ecological and ethical problems. The Sustainable Development Goals (SDG) speak testament to this and although the criticisms on Sustainability never truly stopped, it remains the only global frame of political action and the only global ethical system in place, that translates the human rights discourse into the 21st century. Sustainability, it seems, has become our only shared utopia left standing.

But there is a second dimension to Sustainability 4.0 more strongly connected to digitalization. In this view, Sustainability 4.0 is the marriage of Sustainability and the digital economy. And as the fundamental principle of the digital economy is co-creation, Sustainability 4.0 implies the empowered co-creation of prosumers in order to re-shape the economy and society towards social inclusiveness and ecological soundness. It starts with products and processes like smart cities, 3D printers, makerspaces, zero waste and smart trash; but it goes far beyond that and encompasses two economic paradigms for this ‘Great Sustainability Transformation’:

1. Sharing Economy: predominantly commercial oriented co-creation, provision and use of sharing services as in carsharing, tool sharing, couchsurfing, co-working and the likes. The sharing economy is still focused on competitive economic action based on the accumulation and use of (mostly monetary and production) capital under a market governance regime. Be aware that the ‘disruption’ caused by the sharing economy is actually destructive as it destoys value-added in an industry (just count the revenues of the encyclopedia industry before and after Wikipedia).

2. Commons Economy: predominantly cooperative oriented co-creation, provision and use of more localized services as in repair cafés, makerspaces, urban farming/gardening, local exchange trading systems and the likes. The commons economy is focused on cooperative economic action based on reciprocity and some form of redistribution of value, power and decision; on democratic governance in a cooperative culture (note: you don’t have to be a cooperative to work like a cooperative); and being, at least partially, autonomous from markets and more oriented to self-sustaining.

The underlying mindset of both paradigms is using and (partly or fully) co-creating a service that is needed in order to reduce material consumption, throughput, and product ownership, while at the same time connecting to others and forming a community of prosumers. The sharing economy is insofar a step from the existing ‘Now Economy’ to the ‘Next Economy’ where a commons orientation plays a more dominant role in everyday economic and social life, while economic growth loosens its grasp on our imagination.

All of this is by no means secure, there are many bumps along the road; but this has always been the case with both Sustainability and digitalization. The potential of Sustainability 4.0 as described herein is vast, disruptive and transformative. Taken serious, the combined forces of Sustainability and digitalization, the promises of a digitally empowered life as co-creators in a digital economy, together with the greater meaning of building a more sustainable society with others, are strong. It would be foolish and irresponsible not to make that combination a reality.

Tags: co-creation, new economy, prosumers, sharing economy, Sustainability