The Path to Accountable Capitalism8 min read

Overview of NewRock’s Hybrid Approach to Business

To address the climate crisis, NewRock proposes to smarten-up today’s disconnected and dumbed-down capitalism. The current “consensus” economic model is incapable of signaling us when systemic threats arise. Nor is it able to evoke a common sense of purpose with appeals to nationalism (as in Russia), ideology (as in China) or, as in Western economies, a persistent faith in financial signals.

With its globally adaptable hybrid model, NewRock’s stakeholder-inclusive approach to business can shift economies toward bottom-up participation, personal accountability and transparency. Embrace an incentivized relational model as a complement to today’s solely transactional model and, by design, ecological resilience will emerge as business success is measured, at least in part, by metrics able to incentivize a steady reduction in impact on the environment.

The model also provides a means for hydrocarbon producers to access in-the-ground wealth while leaving the bulk of their oil and gas in place. A portion of that natural capital can capitalize stakeholder-owned Sustainable Development Banks focused on making producer nations global leaders in renewable energy and energy storage while supporting higher education, vocational training and life-long learning. Other potential sources of in-kind capital include minerals, metals, timberlands and intellectual property.

The NewRock value proposition includes:

  • A replicable and scalable business model adaptable to economies worldwide regardless of ideology.
  • A business strategy designed to address systemic risks—social, fiscal and ecological.
  • A for-profit means to anticipate the two largest fiscal outlays—education and healthcare.
  • A free market approach to development appealing both to business and government.
  • A self-financing strategy funded, in part, by achievable savings and fiscal efficiencies.
  • A means to accelerate investment in next-generation energy technologies and infrastructure.
  • An approach to preventive healthcare that utilizes big data to incentivize systemic cost savings.
  • A means to invest in credit instruments that positively impact long-term outcomes.
  • A path to bypass the current ‘consensus’ with its proven inability to create sensible outcomes

A hybrid structure recycles to public purposes a portion of profits based on stakeholders demonstrating their accountability to community. Today’s dominantly transactional economic model displaces any value not identifiable in terms of money. A relationalmodel helps attune the forces of finance to the interests of community, the environment and the future by harnessing private enterprise to address public needs.

NewRock offers an affordable, self-financed path to reduce costs imposed on the commons such as:

  • Healthcare costs—due to bad air/water quality, poor primary care, inferior nutrition, failure to treat, etc.
  • Subsidy costs—for food, fuel, education, transportation, pensions, public sector jobs, etc.
  • Environmental costs—impact on air/water quality, fisheries, forests, wildlife, quality of life, etc.
  • Fiscal costs—debt imposed on the future, deferred maintenance, foregone infrastructure, etc.
  • Education costs—restraints traceable to illiteracy, poor education, ill-trained workforce, etc.
  • Social costs—widening social divide, lack of trust, record stress, loss of confidence in government, etc.
  • Security costs—law enforcement, growth of the military, militarization of law enforcement, etc.

Hybrid financing techniques can constrain the fiscal costs of education and healthcare, the largest budgetary burden for governments worldwide. Pay-it-forward education provides a means to align the interests of students, parents and faculty. A relationalbusiness model realigns interests to incentivize an ‘accountable capitalism’. Widely inclusive, locale-attuned economies can better optimize the utilization of all forms of capital—financial, human, social, fiscal, political and natural. Financial techniques are themselves a form of capital that can be optimized to generate sensible and sustainable outcomes.

Unless interests are aligned outside the current paradigm, change will not come rapidly enough to address the climate crisis nor in a way that advances a just, stable and sustainable future. NewRock’s relational model is designed to align those interests. Our self-financed approach can seed a more resilient future through positive change, including widespread access to affordable energy, higher education and quality healthcare with incentives that support energy efficiency, lifelong learning and preventive healthcare.

Social media and search engine firms extract value from community by profiting from information about their profiled users. [“If the product is free, the product is you.”] With user-owned alternatives, the financial value of user impressions can recycle advertising revenue to support community needs such as education and preventive healthcare. Communities presently receive no benefit either for their patronage or the content they provide. Two firms now control 60 percent of the online advertising market.

At the end of March 2020, Google’s parent Alphabet had $117 billion on hand and Facebook more than $60 billion. Amazon reported $24.3 billion in free cash flow. For these firms, an economic downturn means an opportunity to go bargain hunting to buy more firms in the cyber marketspace, ensuring a few dominant online distributors of news, information and content. As antitrust scrambles to address these network effect monopolies, the weaponization of online-harvested data gathers momentum. The Facebook-aided profiling of 87 million U.S. accounts enabled Cambridge Analytica to micro-target persuadable voters in swing states and sway the 2016 presidential election. Democracy also faces a dire sustainability challenge.

Inaction is a Formula for Disaster

Either business practices align interests to protect and restore the environment—including the information environment— or, by our inaction, hasten its decline. That stark choice presents a design, policy and moral challenge. Meeting that challenge presents a business opportunity to create recurring revenue streams while advancing positive outcomes. The source of the sustainability challenge lies in a shared mindset that will change with education, advocacy and examples of commercially successful hybrid business operations.

NewRock offers a for-profit means to hasten the transition to a renewable energy future that aligns incentives to create an ‘accountability culture’ responsive to people, community and the planet. Absent a course correction, today’s consensus will continue to fuel the passivity, polarization and pessimism that impede the ability of both governments and markets to respond to the climate crisis.

Early private-sector adopters will enjoy a competitive advantage by showing how—by partnering with community—business can flourish by fostering social, fiscal and ecological resilience. Early public-sector adopters will stretch their resources as the model monetizes measurable savings and efficiencies. Anticipated savings, in turn, can be bonded. With $102 trillion in assets under management worldwide, what portion can optimally be invested in such hybrid securities?

Step-by-step, interests can be realigned with performance metrics designed to incentivize changes in behavior that benefit community and the commons, including the environment. The climate crisis is dependent on changes in human behavior; either behavior changes or the danger will increase.

Today’s exclusive, solely transactional and foreseeably unsustainable economic model requires an inclusive and relational reboot able to reflect a broader range of values, enabling firms to better address climate change. Education is key along with ecoliteracy. The systemic risks that wealth concentration imposes on governance are severe and steadily worsening. Those who choose to do nothing condone trends on track to undermine widely held values while damaging the fabric of all life on which our shared futures depend.

Democracy is at risk; failure to act may ensure its demise. Authoritarianism is on the rise, including a financial absolutism that grants not deference but dominance to values measurable in terms of money.

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Today’s ‘consensus’ economic model is accountable only to itself. With $102 trillion in assets under management worldwide, the model displaces any value that cannot be identified, calculated and captured in terms of money. Money-myopic and finance-fixated, it’s no wonder we live in a world that feels dumbed-down, disconnected and dangerous—to community, civil society and the environment.

NewRock’s hybrid business model bypasses an approach known to be socially inequitable, politically destabilizing, fiscally shortsighted and ecologically perilous. Most importantly, today’s globally dominant model is ill-equipped to address the climate crisis. Either business practices align interests to protect and restore the environment or hasten its decline. That stark choice presents a design challenge.

True sustainability requires an ability to anticipate and address systemic risks. NewRock offers a for-profit means to create a renewable energy future that aligns incentives to make capitalism accountable both to people and the planet. Absent change, societies will continue to fracture, our habitat will continue its decline and exclusion will continue to fuel cynicism, extremism and terrorism.

Early adopters will enjoy a competitive advantage by showing how to foster social, fiscal and ecological resilience. Locale-attuned metrics incentivize the realignment of interests to generate benefits both for community and the future rather than solely for a well-to-do few. Thus, for example, rather than social media monetizing user attention spans for the financial benefit of a few, that liquidity can service hybrid bonds to support pay-it-forward higher education, preventive healthcare and micro-grid renewable energy.

Those calling for closer government oversight of Facebook and Alphabet/Google fail to grasp that psychographic-assisted micro-targeting is their business model. NewRock proposes to displace user-abusive firms with a user-owned and community-responsive design.

NewRock’s self-financed business model is designed to provide widespread access to affordable clean energy, pay-it-forward higher education and preventive healthcare accompanied by the broad-based prosperity and stability required to sustain human dignity.

Unless interests are aligned outside the current paradigm, change will not advance a genuinely systemic solution. Real change is created by aligning interests around achievable savings and systemic efficiencies that foster healthy and resilient communities. As the model replicates and scales, it rewards behavior that protects community and punishes those who exploit. At the macro level, a stakeholder-responsive strategy provides a hedge against the systemic risks that accompany today’s dominant model.

NewRock offers a more robust framework for genuine sustainability. Designed to bridge the public-private divide, the model enables business to capitalize on the shared prosperity whose absence destabilizes development worldwide. With a globally adaptable financial strategy, NewRock incentivizes the steady reduction of fiscal subsidies by shifting economies in the direction of inclusion, stability, fiscal foresight and resilience.

Designed to operate consistent with the core values of the major faith traditions, the model advances peace through shared prosperity and holistic sustainability. The only practical solution is through improved design that unites rather than fractures community, including information technologies that protect rather than exploit user privacy.