CHAPTER 4

Fostering a Sustainable Development

Overview

According to the Brundtland Commission (WECD 1987), sustainable development meets the needs of the present without compromising the ability of the future generation to meet their own needs. It includes a sustainable dimension of social, economic, and environmental (Kiron et al. 2012) or people, planet, and profit (Ten Bos and Bevan 2011) dimension. Brundtland Commission goes further in explaining that meeting essential needs requires not only a new era of economic growth for nations in which the majority are poor but an assurance that those poor get their fair share of the resources required to sustain that growth. Such equity would be aided by a political system that secures effective citizens’ participation in decision making and by greater democracy in international decision making (WCED 1987).

Environmental Strategies for Sustainability

In 1983, the World Commission for Environment and Development was formulated in order to propose long-term environmental strategies for achieving sustainable development by the year 2000. It emphasized several of the issues related to the future sustainability path. It aimed toward greater cooperation among developing countries and among countries at a different level of economic and social development leading to the achievement of common and mutually supportive objectives that take account of the interrelationships between people, resources, environment, and development.

We have taken several of the key UN sustainable development documents to map their systemic sustainability approach describing them as features of sustainable capitalism in the making. Because of the precision and many times of ingenuity of these documents and elaborated ideas related to sustainable economics and business model, we have attempted to use verbatim formulations, only occasionally making interventions complementing it with supplementary statistics that we have analyzed relating to a variety of subjects. The primary purpose of this approach is to highlight the critical sustainable capitalism features, as depicted in Figure 4.1, of neglected reality, of the interconnectivity of the social, environmental, and economic elements of development.

Figure 4.1 Sustainable capitalism as an interrelationship’s reality

The so-called global civilization-related innovation that the UN has introduced by its “first working body commission” elaboration of the sustainability agenda was that environmental issues, together with development issues, have been defined as universal rights. Not just as potential but as an economic path that is interrelated to overall sustainability rights trajectories. What we considered as crucial in this respect is that UN, even before almost four decades, appealed to citizens’ groups, nongovernmental organizations, educational institutions, and scientific community, calling them all into creating a momentum of public awareness and political change for the global suitability agenda.

Both realities, the scope and the approach to sustainability agenda, are still valid and urgent unfinished missions. Likewise, within this recommendation, we see a mandate and potential mission of business schools to become one of the main stakeholders in proposing and championing sustainable capitalism but also in contributing through its educational missions to its elaboration providing educational modules for global sustainable capitalism stakeholders. It is vital to emphasize that the sustainability agenda cannot be defined and prescribed only for those who can sort off “afford it.” UN was quite elaborate even at the start of global sustainability campaign that economic and social development must be defined in terms of sustainability in and of all countries—developed or developing, market-oriented or centrally planned.

The way we use the term sustainable capitalism is only as a definition of a predominantly global economic system, but it is quite clear that sustainability features have to correspond to all socioeconomic systems, as discussed in earlier chapters. Inevitably sustainable development defined in such a systemic manner involves the progressive transformation of economy and society. Physical sustainability, as UN documents claim, cannot be secured unless development policies pay attention to such considerations as changes in access to resources and the distribution of costs and benefits of economics or business model to all.

Transforming Economies and Societies

Even the narrow notion of physical sustainability implies a concern for social equity between generations, a matter that must logically be extended to equity within each generation. This means greening of the existing mainstream socioeconomic system would not do. Sustainable capitalism embedded in sustainable development is, therefore, as depicted in Figure 4.2, only possible as the progressive transformation of the entire system that reevaluates the importance of the social and natural capital besides creating value-added and cumulated value of financial capital.

Figure 4.2 Sustainable capitalism progressively transforms the economy and society

One of the main postulates of sustainable capitalism in the making is that inequalities are always related to ecological crises and vice versa. Sustainable capitalism, therefore, continues and is even strengthening its mission to challenge and fight poverty in all of its forms but also in challenging the existing systemic problems of all that are excluded or that are left behind. Three decades after its first documents on sustainability UN has prepared a new sustainability agenda document that has pronounced this global sustainable mission through the following statements: an action plan for people, planet, and prosperity, strengthening of the universal peace, eradicating poverty in all forms by involving transformative steps toward the sustainable and resilient path that leaves no one behind.

The vision brought forward is the world free of hunger, poverty, disease, fear, and violence, achieving universal literacy, equitable universal access to education, health, and social protection, right to drinking water, improved hygiene, and sanitation, safe human habitat, and universal access to affordable, reliable, and sustainable energy. Figure 4.3 depicts inequalities among advanced, emerging, and frontier (developing) economies.

Figure 4.3 Sustainable capitalism reduces the widening gap between rich and poor

Source: Spring 2014 Global Attitudes survey, Pew Research Center

Widening Global Inequality

The UN warned about the widening gap between rich and poor almost four decades ago, but even more importantly, the UN has approached this inequality as the planet’s main “environmental” problem being also its main development-related problem. A world where poverty is endemic, the UN emphasizes, will always be prone to ecological and other disasters. Emerging countries are forced to overexploit environmental resources for the sake of the export of resources, often to pay for their excessive debts. Environment gets rapidly degraded in all manners (including desertification, destroying of forests, acid precipitation of soil, global warming, greenhouse effect, shifting agricultural production areas, raising of the sea level and flooding of the coastal cities, depletion of ozone shield, toxic substances in food chains and underground waters) so the need for sustainable capitalism comes from the growing realization that it is impossible to separate economic development from environmental issues.

An increase in poverty and unemployment have increased the pressure on environmental resources, and many governments struggling with their fiscal potential, unfortunately, have cut back efforts to protect the environment, not bringing ecological considerations into development planning. In that respect, again poor are in a particularly delicate situation since they require most environment-related intervention yet have least resource for the financing of these activities, particularly on a more continuous basis. The problem of misconduct that comes from the separation of development from environmental protection arises out of artificial compartmentalization of human activities. The question of artificial compartmentalization of human activities (involving separation between environment, economics, and social issues) is present within nations and within sectors in both developed and developing countries. That is why not much has been done on the sustainability agenda in a systemic manner.

Figure 4.4 Sustainable capitalism challenges global ecological crisis by addressing and eradicating poverty and inequality and resultant depletion of natural resources

Globally this failure is related to all activities that aspired to localize and “fix” sustainability-related problems at national or sectoral levels; sustainable capitalism could not be confined as such, as depicted in Figure 4.4. Notably, a sharp increase of economic interdependence of countries in the course of economic globalization is followed by an accelerated ecological interdependence among nations. Degradation of nature cannot be localized. Growth of population and industrial growth create pressure on natural resources, especially on those poorest. Degradation of environment and development of the poorest have been described by UN as one of the factors that will prompt higher and uncontrolled migrations from the most impoverished countries toward most developed countries (this became obvious even several decades ago).

As we have already pointed out previously UN sustainability agenda places at the center a principle stating that the world in which poverty and inequality are endemic will always be prone to ecological and other crises. Sustainable development requires, in terms of challenging poverty and inequality, meeting the basic needs of all and extending to all the opportunity to satisfy their aspirations for a better life. In that sense, we do not speak only of redistributive reality but also wider global mission and vision of sustainable capitalism. A couple of decades ago the movement concerned with principles and practice of sustainable production and consumption was started.

The living standards that go beyond the essential minimum are sustainable only if consumption standards everywhere have regard for long-term sustainability. UN sustainability agenda claims that the perceived needs of humanity, groups, and individuals are socially and culturally determined. During that understanding and promotion of sustainable capitalism, we will require the development of values that encourage consumption standards that are ecologically possible and to which all can reasonably aspire. UN, in the course of its sustainability mission, has rightfully asserted that meeting of essential needs depends in part on achieving full growth potential, and sustainable development clearly requires economic growth in places where such needs are not being met. But growth by itself is not enough. High levels of productive activity and widespread poverty can coexist and can endanger the environment. Hence sustainable capitalism requires that societies meet human needs both by increasing productive potential and by ensuring equitable opportunities for all.

Currently, despite the overwhelming body of optimistic rhetoric, that is not the case. At the same time, sustainable capitalism can only be pursued if demographic developments are in harmony with the changing productive potential of the ecosystem. UN has recognized that not only poverty and environmental degradation but also population growth is inextricably related and that none of these fundamental problems can be successfully addressed in isolation. In general, renewable resources like forests and fish stocks need not be depleted provided the rate of use is within the limits of regeneration and natural growth. That is a response to criticism stating that sustainable capitalism is only about the limitation and conservation of natural resources not considering human development and survival-related activities. It is obvious that problems are due to the excessive level of exploitation of human and natural resources. As depicted in Figure 4.5, sustainable capitalism moves away from exploitations of human and natural capital in scale and scope and moves toward the more natural scope of their regeneration. Renewable resources are parts of a complex and interlinked ecosystem, and maximum sustainable yield must be defined after considering systemwide effects of exploitation.

Figure 4.5 also shows that global growth after great financial crises that occurred in 2008 and the worldwide decline of 2009 have turned into a continuance of global growth of developed countries only. After the global financial crisis world has primarily moved away from less developed countries and both least developed and middle-income economy countries, which cumulatively slowed the global growth prospects. Only most developed countries continued to show growth potential which is the crucial argument for the statement that other things being equal we may assume that world again would only increase the level of the global economic product, but it would not reduce the existing economic, social, and environmental levels of inequalities.

Figure 4.5 Sustainable inclusive capitalism challenges inequalities of all kinds

Source: Authors’ calculations according to the World Bank database

Again, less, and least developed countries would be forced to overexploit their resources: human and nature. UN had, in its first report in the mid-1980s of the last centuries warned that many problems arise from inequalities in access to resources. An inequitable land ownership structure can lead to overexploitation of resources in the smallest holdings, with harmful effects on both environment and development. Internationally, monopolistic control over resources can drive those who do not share them with excessive exploitation of limited resources. The differing capacities of exploiters to commandeer “free” goods—locally, nationally, and internationally—are another manifestation of unequal access to resources. “Losers” in environment/development conflicts include those who suffer more than their fair share of the health, property, and ecosystem damage costs of pollution.

In this sense, inequality and equality are related to systemic access and systemic inability to access resources in a more equitable manner. When a system approaches ecological limits, inequalities sharpen. When a watershed deteriorates, poor farmers suffer more because they cannot afford the same antierosion measures as more prosperous farmers. When urban air quality declines, the poor, in their more vulnerable areas, suffer more health damage than the rich, who usually live in more pristine neighborhoods. When mineral resources become depleted, late-comers to the industrialization process lose the benefits of low-cost supplies. Hence, our inability to promote the common interest in sustainable development is often a product of the relative neglect of economic and social justice within and amongst nations. That is why the notion of social and environmental justice becomes one of the critical features of sustainable capitalism in the making.

Almost three decades after its “Our Common World Report,” the UN has, in the course of monitoring its so-called global sustainability goals expanded this element related to inequality in the sense that it now speaks of inclusive sustainable development versus exclusive ones to leave many behind. This new notion of inclusiveness (social, economic, political, and cultural) is related to empowerment behind the principle of nondiscrimination. It refers to the need to include everyone in societal processes and conveys the notion that people should not only be allowed to thrive but also have a voice and effective opportunities.

Equality, as a concept, has traditionally been related to equality of outcomes and equality of opportunities. Inequality of opportunities refers to cases where different people or sections of society do not have the same opportunity to participate in society and to flourish. This can be the result of explicit and implicit barriers to specific sections of the population, such as discrimination in the law, in custom, and in practice, which limits access to opportunities for certain groups in society. Equality can also be seen in a political sense and related to empowerment. Equality, in that sense, refers to giving different people and sections of equal society voice and equal opportunities in political and social institutions and more control over their lives.

The UN identifies the following international equality and inclusion policy responses: measures related to official development assistance and other financial means; commitments to increase or support investment in specific sectors, with focus on developing countries, for example, agriculture, medicines, and infrastructure; international cooperation and technical assistance; actions on trade; promoting the rule of law at the international level; enhancing collaboration on and access to science, technology, and innovation.

National equality and inclusion policy responses, on the other hand, are aimed at ensuring universal and equal access to basic services; ensuring access to food for all, and end malnutrition; achieving and sustaining income growth of the bottom 40 percent of the population at a rate higher than the national average; doubling agricultural productivity of small-scale food producers, putting in place social protection systems and policies; building the resilience of the poor and vulnerable allowing them access to employment; and expanding infrastructure with a focus on affordable and equitable access for all.

Ending discrimination policy responses are aimed at empowering and promoting the social, economic, and political inclusion of all; ending all forms of discrimination against women and girls; eliminating violence against women and girls; ending abuse, exploitation, trafficking, and all forms of violence against and torture of children; recognizing unpaid care and domestic work; equal access to technical, vocational, and tertiary education; and equal pay for work of equal value, eliminating discriminatory laws, policies, and practices and promoting and enforcing appropriate legislation, policies, and action in this regard; promoting the rule of law and ensuring equal access to justice for all; protecting fundamental freedoms; eradicating forced labor, including the worst forms of child labor, human trafficking; protecting labor rights, and providing legal identity for all. The following are the opportunities for empowerment and enhancing capabilities policy response:

• Access to sexual and reproductive healthcare services
• Enhancing access to markets and financial services for households and SMEs
• Ensuring responsive, inclusive, participatory, and representative decision making
• Ensuring women’s full and effective participation and equal opportunities for leadership at all levels of decision making in political, economic, and public life
• Fiscal, wage policies aiming to progressively achieve greater equality; use of enabling technology, in particular, information and communications technology
• Full and productive employment and decent work
• Increase in skills for employment and entrepreneurship, ensuring equal access to economic resources
• Literacy and numeracy
• Policies that support productive activities, decent job creation, entrepreneurship, creativity, and innovation
• Provision of public services and infrastructure
• Universal access to sexual and reproductive health and reproductive rights
• Universal primary and secondary education

As depicted in Figure 4.6, sustainable capitalism must not endanger the natural systems that support life on the environment, the atmosphere, the waters, the soils, and the living beings.

Figure 4.6 Sustainable capitalism must not endanger the natural habitats

Settled agriculture, the diversion of watercourses, the extraction of minerals, the emission of heat and harmful gases in to the atmosphere, commercial forests, and genetic manipulation are all examples of human intervention in natural systems during the course of development. At a minimum, sustainable capitalism must not endanger the natural systems that support life on the environment. With minerals and fossil fuels, the rate of depletion and the emphasis on recycling and economy of use should be calibrated to ensure that the resource does not run out before acceptable substitutes are available. Sustainable capitalism requires that the rate of depletion of nonrenewable resources should foreclose as few future options as possible. Development tends to simplify ecosystems and to reduce their diversity of species. And species, once extinct, are not renewable.

The loss of plant and animal species can limit the options of future generations, so sustainable capitalism requires the conservation of plant and animal species. The so-called free goods like air and water are also resources. The raw materials and energy of production processes are only partly converted to useful products. The rest comes out as wastes. Sustainable capitalism requires that the adverse impacts on the quality of air, water, and other natural elements are minimized to sustain the ecosystem’s overall integrity. In essence, sustainable capitalism is a process of change in which the exploitation of resources, the direction of investments, the orientation of technological development, and institutional change are all in harmony and enhance both current and future potential to meet human needs and aspirations.

The principal global development challenge, as emphasized by UN, is to meet the needs and aspirations of an expanding developing world population. The most basic of all requirements is for a livelihood, that is, employment. The pace and pattern of economic development have to generate sustainable work opportunities on this scale and at a level of productivity that would enable poor households to meet minimum consumption standards. Another priority is food production, but increased food production should not be based on ecologically unsound production policies and compromise long-term prospects for food security. Sustainable development can be pursued more easily when population size is stabilized at a level consistent with the productive capacity of the ecosystem. In that sense three decades ago, this challenge has been identified in the phenomenon of growing population countries struggling with poverty and hunger and their problems related to how to quickly lower population growth rates, especially in regions such as Africa, where these rates are increasing. Developing countries in that respect will have to promote direct measures to reduce fertility to avoid going radically beyond the productive potential to support their populations.

Sustainable capitalism, on the other hand, ought to be related to the development of smaller urban centers reducing the pressures in large cities. Solving the impending urban crisis will require the promotion of self-help housing and urban services by and for the poor, and a more positive approach to the role of the informal sector, supported by enough funds for water supply, sanitation, and other services. If needs are to be met on a sustainable basis, the environment’s natural resource base must be conserved and enhanced.

Significant changes in policies will be needed to cope with the industrial world’s current elevated levels of consumption and consumption required to meet minimum standards in developing countries in the context of expected population growth. Land use in agriculture and forestry must be based on a scientific assessment of land capacity, and the annual depletion of topsoil, fish stock, or forest resources must not exceed the rate of regeneration. Short-sighted, short-term improvements in productivity can create different forms of ecological stress, such as the loss of genetic diversity in standing crops, salinization, and alkalization of irrigated lands, nitrate pollution of groundwater, and pesticide residues in food. Ecologically more benign alternatives are available. Future increases in productivity, in both developed and developing countries, should be based on better controlled application of water and agrochemicals, as well as on more extensive use of organic manures and nonchemical means of pest control.

Finally, the ultimate limits to global development are determined by the availability of energy resources and by the biosphere’s capacity to absorb the by-products of energy use. These energy limits may be approached far sooner than the restrictions imposed by other material resources. First, there are the supply problems: the depletion of oil reserves, the excessive cost and environmental impact of coal mining, and the hazards of nuclear technology. Second, there are emission problems, most notably acid pollution and carbon dioxide build-up leading to global warming. Industrialized countries must recognize that their energy consumption is polluting the biosphere and eating into scarce fossil fuel supplies. Recent improvements in energy efficiency and a shift toward less energy-intensive sectors have helped limit consumption, but the process must be accelerated to reduce per capita consumption and encourage a change to nonpolluting sources and technologies.

The prevention and reduction of air and water pollution will remain a critical task of resource conservation. Air and water quality come under pressure from such activities as fertilizer and pesticide use, urban sewage, fossil fuel burning, the use of certain chemicals, and various other industrial activities. Each of these is expected to increase the pollution load on the biosphere, particularly in developing countries. Cleaning up after the event is an expensive solution. Hence all countries need to anticipate and prevent these pollution problems by, for instance, enforcing emission standards that reflect long-term effects, promoting low-waste technologies, and anticipating the impact of new products, technologies, and wastes.

Figure 4.7 depicts one, if not a key, source of increasing the gap in growth and development between developed and developing countries, which adds to the unsustainability of the present form of capitalism. That source is creation and benefits from the creation of innovative technology which is almost entirely located in the developed part of the world.

Figure 4.7 A key source of increasing the gap in growth and development between advanced and emerging/frontier economies

Source: Authors’ calculations according to the World Bank database

Most of the developed technology is related, and income generated from it is the source of growth of the developed countries, countries of high income. In time this gap only widens. Technological lagging behind for the developing part of the world is a systemic problem for the present form of capitalism, which is evidence-based when it comes to the failure of the assumption that dissemination and creation of technology and then of productivity and innovation would spread from more to less developed countries.

Fostering Socioeconomic Developments

Socioeconomic development is inextricably linked to technology change, as technology, society, and institutions coevolve. Technology change can be a source of conflict, as well as a tool for social inclusion and greater cooperation. The UN takes an example of ICTs, which have allowed considerable advances in this respect, for instance, in health, education, transport, and communications, but they have led to security and privacy challenges.

A circular economy is one in which industrial systems are restorative and regenerative by intention and design. Creating a circular economy requires bringing together academia, the private sector, the public sector, and civil society. More sustainable production schemes and innovation in the private sector are needed. Countries need to explore their own desired paths of economic diversification based on the identification of promising technological trajectories and new industries. Empirical evidence shows that development is associated with the shift of labor from low- to high-productivity and high-wage activities. The changes in the composition of the economic system occurring during this process give rise to an increasing variety and complexity of economic activities. Increasing complexity is associated with higher levels of GDP and growth and reduction of inequality. That process is ultimately the result of innovation, and that is the reason why innovation is one of the central pillars of sustainable capitalism. Promising actions in all these strategies is the use of empirical data on production, exports, and innovation to identify specific technology trajectories to guide the transition toward sustainable capitalism.

Promising technological innovations and new industries can be identified, using patent databases, benchmarking early movers based on their comparative advantage, and/or by using the “product space” and measures of product complexity.

There are several techniques that will figure prominently in the course of sustainable capitalism, and a resource aid, including but not limited to:

1. Bio-tech: biotechnology, genomics, and proteomics; gene-editing technologies and custom-designed DNA sequence; genetically modified organisms (GMO); stem cells and human engineering; bio-catalysis; synthetic biology; sustainable agriculture tech
2. Digital-tech: big data technologies; Internet of Things; 5G mobile phones; 3-D printing and manufacturing; cloud computing platforms; open data technology; free and open-source; massive open online courses; micro-simulation; E-distribution; systems combining radio, mobile phone, satellite, GIS, and remote sensing data; data sharing technologies, including citizen science-enabling technologies; social media technologies; mobile apps to promote public engagement and behavioral change; prepaid system of electricity use and automatic meter reading; digital monitoring technologies; digital security technology
3. Nano-tech: Nano-imprint lithography; nanotechnology applications for decentralized water and wastewater treatment, desalination, and solar energy (nanomaterial solar cells); promising organic and inorganic nanomaterials, for example, graphene, carbon nanotubes, carbon Nano-dots and conducting polymers, perovskites, iron, cobalt, and nickel nanoparticles, and many others
4. Neuro-tech: Digital automation, including autonomous vehicles (driverless cars and drones), IBM Watson, e-discovery platforms for legal practice, personalization algorithms, artificial intelligence, speech recognition, robotics, smart technologies, cognitive computing; computational models of the human brain; mesoscience-powered virtual reality.
5. Green-tech: Circular economy: technologies for remanufacturing, technologies for product lifecycle extension such as reuse and refurbishment, and technologies for recycling; multifunctional infrastructures; technologies for integration of centralized systems and decentralized systems for services provided; CO2 mitigation technologies; low energy and emission technology. Energy: modern cookstoves with emissions comparable to those of LPG stove; deployment of off-grid electricity systems (and perhaps direct current); minigrids based on intermittent renewables with storage; advances in battery technology; heat pumps for space heating, heat and power storage and electric mobility (in interaction with off-grid electricity); smart grids; natural gas technologies; new ways of electrification; desalination (reverse osmosis); small- and medium-sized nuclear reactors; biofuel supply chains; solar photovoltaic, wind, and micro-hydro technologies; salinity gradient power technology; water-saving cooling technology; LED lamps; advanced metering. Transport: integrated public transport infrastructure, electric vehicles (e-car and e-bike), hydrogen-fueled vehicles, and supply infrastructures. Water: mobile water treatment technology, wastewater technology, advanced metering infrastructure. Buildings: sustainable building technology, passive housing. Agriculture: sustainable agriculture technology; innovations of bio-based products and processing, low input processing and storage technologies; horticulture techniques; irrigation technologies; bio-organometallics, which increase the efficiency of biomimetic analogs of nitrogenize. Other: marine Vibrioses, artificial photosynthesis
6. Other technologies: Assistive technologies for people with disabilities; alternative social technologies; fabrication laboratories; radical medical innovation; geoengineering technologies (e.g., for iron fertilization of oceans); new mining/extraction technologies (e.g., shale gas, in oceans, polar, glacier zones); deep-sea mining technologies

Threats are also present in potential form of unequal benefits, job losses, skills gaps, social impacts, poor people priced out; global value chain disruption; concerns about privacy, freedom, and development; data fraud, theft, cyber-attacks, human health (toxicity), environmental impact (nano-waste), deskilling, job polarization, widening technology gaps, military conflicts, and new inequalities.

At the global level, as depicted in Figure 4.8, GDP has not recuperated from the global setback caused by the financial crisis in 2008 and consequent 2009 recession or it is more accurate to state that developing part of the world has not recuperated from it but global implications of it are relatively present for the entire of the world GDP.

Figure 4.8 GDP has not recuperated from the global setback caused by financial crisis in 2008

Source: Authors’ calculations according to World Bank database

This means that development catching up would not be possible any time soon, and the gap between the rich and the poor would deepen again. Development that is sustainable has to address the problem of a large number of people who live in absolute poverty, that is, who are unable to satisfy even the most basic of their needs. Poverty reduces people’s capacity to use resources in a sustainable manner; it intensifies pressure on the environment. Growth must be revived in developing countries because that is where the links between economic growth, the alleviation of poverty, and environmental conditions operate most directly. Yet developing countries are part of an interdependent world economy; their prospects also depend on the levels and patterns of growth in industrialized nations.

Capitalism is unsustainable if it increases vulnerability to crises. The vulnerability can be reduced by using technologies that lower production risks, by choosing institutional options that reduce market fluctuations, and by building up reserves, especially of food and foreign exchange. A development path that combines growth with reduced vulnerability is more sustainable than one that does not.

Sustainable capitalism requires views of human needs and well-being that incorporate such noneconomic variables as education and health enjoyed for their own sake, clean air and water, and the protection of natural beauty. Changing the quality of growth embedded in the notion of sustainable capitalism requires changing our approach to development efforts to take account of all of their effects. In some cases, sustainable capitalism will involve a rejection of activities that are financially attractive in the short run. Economic and social development can and should be mutually reinforcing. Money spent on education and health can raise human productivity. Economic developments can accelerate social development by providing opportunities for underprivileged groups or by spreading education more rapidly.

Infrastructure, in the broader sense, according to a UN document on global sustainability goals is defined as a means to fulfill a human need. It is composed of primary assets and objects that, in the aggregate, are deemed essential for the functioning of society and the economy. The scope of the infrastructure, as such comprises essential services such as water, sanitation, and energy, and connectivity infrastructure, including roads, transport systems, and information and communication technologies. Infrastructure affects inequality of outcomes and opportunities through three main channels:

1. Infrastructure providing essential services such as water, sanitation, and electricity may affect inequality depending on the quality, design, coverage, accessibility, and distribution of that infrastructure.
2. Infrastructure such as irrigation, electricity, ICT, and roads increases productivity and reduces trade costs, which affect the structural dynamics of the economy, including levels of income and distribution of jobs, and may have an effect on inequality.
3. Connectivity infrastructure, such as roads and ICT, affects the access of people to goods, services, and job opportunities, and therefore may affect inequality.

Environmental regulation must move beyond the usual menu of safety regulations, zoning laws, and pollution control enactments; environmental objectives must be built into taxation, prior approval procedures for investment and technology choice, foreign trade incentives, and all components of development policy. The integration of economic and ecological but also social factors into the law and decision-making systems within countries has to be matched at the international level. The growth in fuel and material use dictates that direct physical linkages between ecosystems of different countries will increase. Economic interactions through trade, finance, investment, and travel will also grow and heighten economic and ecological interdependence.