The model of the economy for the common good

We consume more resources than we have available and yet continue to strive for economic growth. The Economy for the Common Good was launched in 2010 by Austrian philologist Christian Felber as a reform movement and alternative form of economy. As a counter-movement to the market economy, it aims to put the focus back on people and the community. 

 

"The Economy for the Common Good is the dawn of an ethical market economy whose goal is not the increase of monetary capital, but a good life for all." (GWÖ Austria)

 

What is the Economy for the Common Good (ECG) all about?

It is an alternative economic model, an ethical market economy with free markets and private companies, in which companies cooperate with each other instead of competing. This model emphasizes sustainability and solidarity. The purpose of economic activity in this system is no longer to increase money, but to fulfill human needs.

 

One of the strengths of the Economy for the Common Good is that it is based on core elements of the capitalist market economy: Business, credit, trade, markets, property. However, it transforms these elements by consistently placing them at the service of overarching values - human dignity, solidarity, justice, sustainability, democracy. It is therefore a matter of transformation and further development, not "disruption" or "system change".

Christian Felber, founder of the Economy for the Common Good

 

"The foundations of the Economy for the Common Good are the Universal Declaration of Human Rights, basic democratic and constitutional values, relational values based on the findings of social psychology, the ethics of respect for nature and the protection of the Earth(Earth Charter) as well as recognized scientific facts such as the concept of planetary boundaries," says GWÖ Austria.

According to Felber's book "Gemeinwohl-Ökonomie", the common good product (macro level), the common good balance sheet (meso level) and the common good audit (micro level) should replace GDP, financial profit and financial return as the previous, purely monetary measures of success.

The goals of the ECG largely coincide with the 17 UN Sustainable Development Goals (SDGs).

The UN's World Future Treaty says one thing first and foremost - it's your decision

 

The five values of the common good

These are human dignity, solidarity and social justice, ecological sustainability, transparency and democratic co-decision-making and form the basis for the preparation of the common good balance sheet that every company is required to draw up. In a so-called "matrix" makes corporate activities comprehensible and takes all dimensions of ethical behavior into account.

A points system is used to classify how the values are already implemented in practice in the respective company. In addition to a look inside the company, the following interest groups are also taken into account: Suppliers, owners and financial partners, employees, customers and the social environment. As it is a comprehensive tool, it covers common CSR reporting standards and even goes beyond them.

This economic model can be applied not only to companies, but also to communities, NGOs and even at supranational level. For example, the first common good region is to be established in Germany and educational institutions are also setting up the first chairs and starting research activities on the topic.

 

Incentives to rethink

In order to encourage economic players to rethink, tax incentives and favorable loans, as well as access to the global market and global trade, should reward those who operate sustainably. On the other hand, those who act in a socially or ecologically harmful manner should be treated less favorably.

 

A worldwide movement

The Economy for the Common Good began in Vienna in 2010, is most strongly represented in the D-A-CH region and from here has gained supporters all over the world. Today, the reform movement has 11,000 supporters worldwide, around 4,500 members in over 170 regional groups, over 1,000 companies with balance sheets and other organizations in 35 countries.

Well-known companies that support the common good include the green electricity provider Polarstern, the organic farming association Bioland, the outdoor supplier Vaude, the health insurance company BKK ProVita, the drinking bottle manufacturer Soulbottles, the organic pioneer SONNENTOR and the furniture manufacturer Grüne Erde.

 

Pioneering?

"The rapid spread of the idea shows the population's longing for a new, ethical economic system that serves us humans and the common good," says Kuno Haas, Managing Director of Grüne Erde. "This opens our eyes to the future and shows where the journey should take us."

 

Voices from the economic sector are critical of the approach and some experts warn of the far-reaching changes that would result from the widespread introduction of the Economy for the Common Good. Enormous costs due to bureaucratic effort, the migration of companies, the loss of prosperity and above all - according to Karin Steigenberger from the Austrian Chamber of Commerce - "considerable restrictions on the economic freedoms of individuals and companies, including expropriation" are cited as the main points of criticism.

 

Christian Felber, on the other hand, repeatedly emphasizes that the economy for the common good is only a concept that should be developed further by politics, business and society. Furthermore, it must be recognized that the existing system has led to global warming, which has brought and will bring far more far-reaching changes.