For a while now, International Finance Institutions have been trying to integrate their activities better with the wider economic and financial system. Their efforts to better align social and environment objectives with private sector and non-government objectives mirror the principles of Triple Bottom Line (People, Planet, Profit) coined by Volans co-founder John Elkington in 1994 - TBL was intended to pull Planet and People into the Profit focus of businesses; IFIs have been trying to pull Profit better into their Planet and People focus. But IFIs will have to do much more if they are to remain relevant.
In 2018 John Elkington recalled Triple Bottom Line because it had done little to trigger the kind of systemic change that is needed to make capitalism sustainable. Instead most adopters were using TBL as little more than an accounting tool. With the backing of organisations like Aviva Investors, The Body Shop International, Covestro, Unilever and the Scottish Environmental Protection Agency, Volans’ Tomorrow’s Capitalism Inquiry is exploring how the principles of the Triple Bottom Line can be applied to accelerate the emergence of an economic system where companies thrive because of – not in spite of – their commitment to creating economic, social and environmental value. International Financial Institutions need to be part of this systemic inquiry.
Unless IFIs help trigger the sort of economy wide transformation that Tomorrow’s Capitalism Inquiry foresees, their goals of poverty reduction and environment protection, are going to become more and more difficult to reach. They will become increasingly irrelevant trying to address the negative outcomes of systems over which they have no influence. They would have missed the opportunity to contribute to the way tomorrow’s economic systems will be shaped and to define for themselves a role in them. IFIs are uniquely positioned to act as systemic connectors - pulling together the public resources, private investments, philanthropic capital, and non-government initiatives that will be needed to trigger systemic change and influence evolution. IFIs must participate in Tomorrow’s Capitalism Inquiry to make sure that they remain relevant, influential, and effective.