In 2019, the European Green Deal was introduced to overcome the challenges of the EU green transition, which aims to make Europe the first climate neutral continent in 2050. In order to have more impact than a simple legislation, a whole new model of business appeared, built in the spirit of regeneration. Instead of simply slowing down damages the environment suffers from, regeneration aims to reverse them by renewing the planet’s natural resources. For the purposes of this article, we interviewed Thomas Busuttil, founder of Imagin/able (part of the R3 Group), a startup supporting businesses to define and implement sustainable and re/generative innovation strategies.
Regenerative vs. sustainable business: what’s the difference?
Regenerative business and sustainable business both share the ambition to reduce their carbon footprint. However, regenerative business takes further action in its conscious and deliberate commitment to protect the environment and its inhabitants, while keeping good results. Thomas Busuttil explains that “the objective is to make people understand how the sustainability prism fuels and improves business strategies. Today, we can see that there is still a very siloed vision of how sustainability works, on the margin of the business model.
This is why, in my opinion, the 3Ps model, ‘people, planet, profit’, proposed at the end of the 90s is not correct, because it does not reflect the reality of a company where challenges are by nature transversal and global. We must try to get to the center of these three pillars.”
According to a study led by the platform ReGenFriends, 80% of American consumers prefer regenerative brands to simply “sustainable” brands. Establishing regenerative policies therefore allows them to stand out from competitors, improve brand image and draw customers who are concerned about the environment.
Thus, when sustainable businesses apply the less is more principle in an attempt to minimize human activity impact on the environment, regenerative businesses aim to move beyond in order to renew resources and take action for the planet and, more broadly, for society.
For our expert, “the main dimension of the regenerative vision is its holistic, systemic, ecosystemic approach – and when I say ecosystemic, it is not only environmental, it is also societal, economic. We need to apply this ecosystemic vision”. These regenerative policies then rely on several levers which allow businesses to take ownership of global issues. The agriculture principle lies in environmentally friendly practices such as compost, crop combination or vegetation cover.
The finance lever, through impact investing, helps to build a more sustainable economy while supporting companies that innovate to protect and regenerate the environment. Another main tenet is community empowerment and community inclusion. This allows companies to foster initiatives that meet local needs and share in the creation of value. At last, the less is more lever allows to limit the use of resources and to reinvest time and money in other environmentally friendly projects. It is the synergy between all of these tenets that makes the implementation of these different practices truly effective.
Thomas Busuttil identifies three levels for businesses: “To put it simply, a business can have three levels. First, there is the responsible company, which respects social and environmental regulations – no more and no less. Then we move on to the contributive company, where we think about generating positive value, beyond the financial aspect, but companies only follow this vision as long as it does not hinder their profits, and the model in place is not necessarily questioned. To apply a regenerative vision, the third level, you have to question the existing model and understand that any action I take as a company will have an impact on the social, societal and environmental levels, throughout my value chain.”
Europe is a pioneer regarding the transformation of businesses
At European level, many businesses are committed to the environment, through regenerative policies. Thomas Busuttil explains that Imagin/able “tries to link these regenerative approaches to a sustainable innovative framework. Regeneration can be a source of innovation that drives business. We promote a sustainable design thinking, which is natively sustainable and which is not driven by technology or customer demand, but by societal and environmental challenges. Then, you have to understand the challenges that are related to your business, the ones that are most impactful, to suppress the negative impacts.”
For instance, CircularInnoBooster Fashion and Textile is a COSME project launched by the European Union to ease the transformation to the circular and regenerative economy of companies in the fashion and textile sector. The project, 75% co-financed by the European Commission, is composed of an international consortium led by the European Design Institute (EDI), but also The Circular Project. This project echoes Imagin/able’s interest in regenerative fashion: “We are currently conducting a second study on regenerative fashion – after cosmetics – and we are noticing true innovations. For example, 100% recycled wool, which is 100% bio-assimilable and therefore has no negative impact. This regeneration indicator should become a real indicator for companies, and it proves that regeneration adapts to all sectors.”
Pioneer businesses of all nationalities and sectors, such as Danone, Marks & Spencer or Patagonia, apply regenerative policies in Europe, Africa – and more broadly across the world. This commitment from businesses matters even more because according to Wunderman Thompson Intelligence’s 2021 “Regeneration Rising” study, 81% of respondents believe that businesses must establish themselves as the drivers of this regeneration otherwise it will not happen.
In 2018, Danone launched Danone ACT, a commitment in favor of french sustainable agriculture. The enterprise has chosen regenerative policies, respectful of soils, biodiversity, animal welfare and society, to demonstrate another way to farm is possible. Building upon this early momentum, Danone is committed to ensuring that by 2025, 100% of its products in France are derived from regenerative agriculture.
In the UK, british brand Marks & Spencer determined three objectives to reach by 2025 to lead their regenerative strategy: improve the welfare of 10 million people, revive 10 000 communities and support regenerative agriculture by becoming a zero waste business.
In 2017, the brand Patagonia contributed to the establishment of a certification in holistic agriculture: the Regenerative Organic certification. It covers the welfare of grazing animals, commits to fair compensation for farmers and farm workers, and oversees soil health and land management.
For our expert, “regeneration often starts with the CEO’s convictions. I think that a fair number of CEOs understand that we have reached the famous tipping point, and that we need to take action. Do we really try to radically change our system? Or do we keep working on small things at the margins, without fundamentally changing direction? In regenerative thinking, we speak of redirecting the business model.”
To go further in their responsible practices, companies can implement strategies that are beneficial to the environment and society, but also to business. “Regeneration has several meanings: repair, restore, reestablish, reimplement. Regeneration allows us to generate new economic wealth, but also new environmental, social and societal wealth. The idea is to show what all this offers to companies from a positive point of view, by identifying what they are already doing, which products or services have the most regenerative potential. To achieve this, you have to think differently, you have to change your business mindset”, concludes our expert.