Ethos meets: Kate Raworth

Kate Raworth is an economist known for her work on the ‘doughnut economy’, in which she balances the economic benefits of meeting basic human needs, with planetary boundaries. Having spent decades working with the UN and Oxfam, Raworth now works as a visiting research fellow at the University of Oxford. Ethos’s Andrew Beattie caught up with her to discuss all things doughnut…

What led you to the ideas that you’ve written about in Doughnut Economics?

I went to university at the end of the 1980s to study economics, because like teenagers of the time, I saw a family in Ethiopia; a hole in the ozone layer; I remember the first time that Frank Bough on Nationwide said there’s something called the ‘greenhouse effect’. And, I just wanted to learn — I wanted to have a skill that I felt would equip me to take on these social and environmental issues that were the issues of my time.

But, I got really frustrated with the theories and the limits of the concepts that I was taught. The issues I cared most about were being pushed to the margins — the living world was described as an environmental externality.

I then spent three years working in the villages of Zanzibar with barefoot entrepreneurs, I spent four years at the United Nations on a human development report, I spent over a decade working with Oxfam. I stopped to sit back and I realised I’d spent 20 years of my career trying to make visible the things that were left invisible in mainstream economics. Whether it’s the unpaid caring work of women; the degradation of the living world; the impact of social inequality. I wondered, rather than continually trying to make things visible from the side-lines, what would it look like to put these social and environmental values centre stage?

Meanwhile I had drawn a diagram that looked a bit like a doughnut. My doughnut diagram was published by Oxfam, just as a discussion paper; but, it gained attraction in the world that no-one expected, least of all me. It made me realise the power of pictures. I realised that pictures are deeply powerful in framing the way we think, and what we do, and explain concepts we don’t see.

So, I went back to my economic textbooks, looked at the pictures I’d been taught and realised they framed a very narrow world view that I didn’t want to carry with me. So, I set out in my book to redraw the pictures and the images that tell us what the economy is; what it’s for; who we are; and how it works — and that became Doughnut Economics.

What are the principles of the doughnut?

It‘s a compass for 21st Century human prosperity. Studying prosperity has two sides; on the one side there’s what we’ve always known, which is that everybody needs to meet their basic needs and rights; to have enough food, healthcare, education, housing, water, access to energy, community and transport. Everybody needs to meet those needs, but its only in the last 30 or 40 years that we’ve realised our human wellbeing is deeply dependent upon the stability of the planet. We also need a stable climate, fertile soils, healthy oceans, and a protective ozone layer over our heads.

So, these are the two sides of human wellbeing and I depicted them together in the doughnut. The hole in the middle is the place where people are left falling short on the essentials of life, and we want to get everybody out of that hole, over to the social foundation — so everyone can meet their basic needs and rights. But, we also cannot overshoot the outer edge because there we push the planet out of balance and cause climate breakdown. The climate breakdown consists of nine planetary boundaries that were drawn up by artists and scientists.

The doughnut compass helps us meet the needs of all people within the means of the planet, and to have human wellbeing in a flourishing web of life.

When we recognise that our wellbeing depends upon the planet, it leads us to a very different starting point for economics and what success looks like. So, I put that at the heart.

The first chapter in my book is about changing the goal of economics, moving away from the idea that economic success lies in endless growth, to the idea that success lies in finding the balance where we meet the needs of people within the needs the planet. Then the question becomes: what kind of economic mindset gives us the greatest chance of doing that? Because, it sure as hell it isn’t the one that’s being taught in universities today.

Do you think there’s a steppingstone between the old way of thinking, and the new systems that you feel are appropriate today?

We need people at both ends and in-between on that spectrum. The challenges are people are going to end up fighting each other, because when you’re talking about the value of ecosystem services it can seem to justify the financialisation of nature and value. I understand that sometimes people are doing that strategically to open up that conversation. So, it’s a tricky dance in terms of reshaping language and concepts, to bring people further along the spectrum of reimagining.

But, I think there’s always going to be that inherent tension of moving along the spectrum, because even though individuals can reimagine through regenerative design, they’re very unlikely to be able to persuade whole governmental and business systems to do the same. So, I tend to stand further away at the end of regenerative design, because that’s where I feel I have my value. But, I recognise that other people stand in different places on that spectrum.

Looking at the image of the doughnut today, what’s the current state of play, how does that look?

It’s not easy to look at, because you can see that on the social side, millions of people are left falling short. The red wedges going towards the centre of the circle show the extent to which people are falling short on their most essential needs in life, and yet at the same time we’ve already overshot at least four of these planetary boundaries on the outside.

No generation before us saw this, they very much focused on the inner circle, and believed that economic growth would have strong correlation with improving living standards. They didn’t see the outer side of the circle and realise it’s like a double-sided challenge; we’ve got to come back with planetary boundaries the same time as meeting people’s needs.

So, if last century’s economists didn’t see this, why would we expect their theories to be relevant to take on this challenge? If last century’s business leaders and politicians didn’t see it, why would we imagine that their business models and their policies would be up to take on those challenges?

We are the first generation to see this image, this insight. The realisation belongs to us. We may be the last real chance of turning it around, and it calls on us to come up with not only new economic theories, but new business models, and new governmental policies, so that we actually start to transform the legacy that we’re leaving for the world, and start to meet the needs of all people on the planet.

There’s a fantastic team of researchers in Leeds, where they’ve calculated the equivalent of the doughnut throughout 150 countries. They took it down to the national level, and what you tend to see is that high income countries have basically met the needs of all people to a pretty low global standard, by way of overshooting the needs of the planet. Whereas low income countries haven’t overshot any boundaries, but they’re not yet meeting all the needs of their people. So, the future of economic success would be to meet the needs of all those people within these planetary boundaries, and no country is doing it yet. But, it doesn’t surprise me because no country has ever tried to do this, this is a new standing of prosperity, and a new 21st century goal.

Tell us your idea of regenerative design, and the idea of a generous company?

The idea of regenerative design has been around for decades. When we think about what companies can do, the oldest response is to do nothing. The first response is then to do what pays, incrementally, then to do zero harm. It’s all about eliminating harm. The limitation is to imagine breaking through these glass ceilings of our imagination and saying: ‘Well if they can do zero harm, why not actually aim to do good, and be net-positive as people call it?’