The Gift Economy
by Gifford Pinchot, reprinted from In Context, A Journal of Hope, Sustainability,
and Choice, with permission.
Some Native Americans measured a man's wealth by what he gave away,
not what he horded. Could there be a message here for modern society?
art of the pathway to a sustainable society comes from
government actions such as regulations, taxes, subsidies, and partnerships
that bias the market towards serving the common good. Part of the pathway
to sustainability comes from building organizations with the capacity to
support employees, to serve customers and stockholders, and to deliver ecological
benefits - all at the same time. But neither government regulations and
incentives, nor breakthroughs in corporate ability to address multiple bottom
lines can ever be enough unless the people in the system care about more
than a selfish vision of success.
According to philosopher Lewis Mumford, fundamental
change in civilizations comes when the culture changes its vision of what
it is to be a human being. After a long period of seeing ourselves as conquerors
of nature, we are due for such a change. We will begin facing the challenges
caused by expanding technological power and growing population when we change
what we are striving for. We need a new definition of success.
Systems thinker and psychologist Gregory Bateson calls
our view of ourselves as isolated individuals, "the epistemological
error of Occidental civilization." Arne Naess, the Norwegian philosopher
of deep ecology, suggests that we are at last moving beyond this error to
a larger sense of self, a self which includes the planet. As Joanna Macy,
another deep ecologist, puts it:
"The obvious choice is to extend our notions of self interest.
For example it would not occur to me to plead with you, 'Oh, don't saw off
your leg. That would be an act of violence.' It wouldn't occur to me because
your leg is part of your body. Well so are the trees in the Amazon rain
basin. They are our external lungs. And we are beginning to realize that
the world is our body."
If Joanna Macy and Arne Naess are right that a larger sense of self is spreading
rapidly, then the growing health of our larger self will constitute a success
more important than the triumph of our little self over our neighbors.
Taking pride in contribution
The first step toward a sustainable sense of success is taking pride in
the value of our contributions to others rather than taking pride in the
value of our possessions. By extension, this means striving for quality
in the use of whatever power we have rather than working to get more power
over others as an end in itself. In this view, profit and wealth may help
us to contribute, but they do not themselves constitute business success.
If we went to the grave with riches gained by gutting
the pension fund, or selling pesticides we know cause more harm than the
insects they control, would we count our business lives successful? On the
other hand, what if we stewarded a small company that repeatedly introduced
more ecological ways of doing things? Maybe other larger players who quickly
copied the ecological innovations gained much of the material reward. If
we barely made ends meet, but clearly made the world a better place, is
that a success?
Defining success by what one gives rather than what
one has is neither a new practice nor an overly idealistic view. It is rooted
deep in history and human nature, and is more basic than wealth or money.
The gift economy
In the potlatches of the Chinook, Nootka, and other Pacific Northwest peoples,
chiefs vied to give the most blankets and other valuables. More generally,
in hunter-gatherer societies the hunter's status was not determined by how
much of the kill he ate, but rather by what he brought back for others.
In his brilliant book The Gift: The Erotic Life of Property,
Lewis Hyde points to two types of economies. In a commodity (or exchange)
economy, status is accorded to those who have the most. In a gift economy,
status is accorded to those who give the most to others.
Lest we think that the principles of a gift economy
will only work for simple, primitive or small enterprises, Hyde points out
that the community of scientists follows the rules of a gift economy. The
scientists with highest status are not those who possesses the most knowledge;
they are the ones who have contributed the most to their fields. A scientist
of great knowledge, but only minor contributions is almost pitied - his
or her career is seen as a waste of talent.
At a symposium a scientist gives a paper. Selfish scientists
do not hope others give better papers so they can come away with more knowledge
than they had to offer in exchange. Quite the reverse. Each scientist hopes
his or her paper will provide a large and lasting value. By the rules of
an exchange economy, the scientist hopes to come away a "loser,"
because that is precisely how one wins in science.
Antelope meat called for a gift economy because it was
perishable and there was too much for any one person to eat. Information
also loses value over time and has the capacity to satisfy more than one.
In many cases, information gains rather than loses value through sharing.
While the exchange economy may have been appropriate for the industrial
age, the gift economy is coming back as we enter the information age.
Doing business as a gift to society
The next step in the move toward sustainable business is to make the business
itself a gift to society.
Companies that use sulfuric acid end up with a hazardous waste. DuPont,
instead of distancing itself from the hazardous waste generated by its customers,
saw this problem as an opportunity to differentiate its offering in one
of the most basic of commodities. The company took back the spent sulfuric
acid, purified it, and resold it. This was good business because once DuPont
got good at it - recycling turned out to be cheaper than creating from scratch.
It also gained the company market share and margins in what had become to
others a low-profit, uninteresting commodity. In this case, DuPont does
well by doing good, thus winning both the exchange and gift paradigms.
The sign of excellence in a new world of the larger
self is not vast profit or possessions, but sufficient material success
to allow large and thoughtful contributions to society. For some strategies
of societal service, huge profits may be needed, for example to build up
the capital to purchase forestry land and convert it to sustainable forestry,
or to extend a chain of tutoring schools that serve those who otherwise
might not read, including the poor.
Other strategies for making a contribution might require
only a modest income that could be used for marshaling forces for change
by example or through volunteers. In a world dominated by a larger sense
of self these two strategies could do equal good and would be considered
One feature of our society works directly against implementing
a larger vision of success: institutional ownership of companies. In an
earlier era of owner-operated businesses, an owner who thought solely of
profit without regard for the effect of decisions on employees or the welfare
of the community was thought to be a monster, and rightly so.
In contrast, the law today forbids pension fund managers
from full humanity; they are precluded by law from allowing concerns for
the environment or the good of employees to interfere with maximizing return.
Institutional investment laws need to be changed.
A shift from capital to talent
The critical factor controlling success in business is shifting from capital
to talent. Employees are no longer interchangeable parts. This is not good
for everyone; the undereducated and those whose talents are not now in demand
are losing ground. But there is a bright side. Employers must curry the
favor of their talented employees who increasingly have an ethical agenda.
Employees who can easily find work elsewhere are refusing to work on projects
or for companies that offend their values, even if they would be well paid
to do so. As this trend increases, as people take a stand for sustainability
in choosing their work, even public corporations seeking the favor of bloodless
institutional investors will find that sustainable companies have the best
future because they have the best talent. In fields where creativity counts,
sustainability is a competitive weapon.
This strategy will not work if we are so pure that no
realistic level of improvement would meet our standards. It will not work
if we sell out for green washing instead of instituting real environmentally
conscious practices. Biasing the system for sustainability requires some
of us to be in the game demanding change.
Our ability to make our talent count for change will
often require us to take less for our services than if we were selling to
the highest bidder.
One consulting firm I know virtually requires new consultants
to use their fine salaries to buy expensive cars and houses. They want them
up to their eyeballs in debt so the company can have complete control over
them. They want their consultants living in fear of losing their jobs so
they don't ever put ethics ahead of their sales and profits.
Frugality and choice
Voluntary simplicity is not just polluting less. It is having more to "spend"
on integrity at work. If we can live on less, we can turn down unsustainable
projects at work just as we do in our choices at home.
Talented people have been making sustainable career choices in increasing
numbers. This gives businesses that can provide good work towards good ends
a great advantage, and this advantage will grow as the highly environmentally
and socially conscious generation in school now becomes important talent
The real game in the business world of the ecological
age is running a business or a career so as to make a contribution to the
community, the nation, and even to the planet as a whole. True business
competence in the ecological age is demonstrated by producing a better product
or service for customers and at the same time setting new standards for
reducing pollution, for creating habitat, for helping the less fortunate.
We cannot play this new game until we move beyond the fear of insolvency
and learn to live frugally regardless of financial success.
The old status system is hard on the heart. Living for
the larger self through a strategy of frugality and service opens up the
heart to the glory of creation all around us. The gift is repaid manyfold.
Gifford Pinchot and his wife Elizabeth are principals of Pinchot and Company, a consulting firm that helps large workplaces escape from bureaucracy and hierarchy to release the intelligence, creativity, and integrity of the members. Gifford is author of Intrapreneuring: Why You Don't Have To Leave the Corporation to Become an Entrepreneur (published by Harper & Row). You can reach him at 206/780-2800, email pandcoaol.com, or write to 8600 County Park Rd., Bainbridge Island, WA 98110.