Fernando Fischmann

What Are Green Swans and Why They Matter

26 October, 2022 / Articles

Recommended article from Forbes

Can capitalism ever be sustainable? And if so, how? The answer might lie in “Green Swans.”

In 2007, Nassim Nicholas Taleb coined the term “Black Swan.” Black Swans are highly improbable events that come as a surprise, have major disruptive effects, and that are often rationalized after the fact as if they had been predictable to begin with. Vivid examples of Black Swans are the Covid pandemic and the war in Ukraine: while foreseen by some, both were surprising to many, highly disruptive, and predictable in hindsight. As a result, they took the large majority of people and companies worldwide by surprise.

Now, 15 years later, John Elkington, the originator of the Triple Bottom Line, author of 20 books, and founder of sustainability consultancy Volans, introduced the term “Green Swan” in his book Green Swans: The Coming Boom In Regenerative Capitalism. I spoke with him to find out what Green Swans are, why they matter, and what can be done in order to create them.

What Green Swans Are

According to his book, Green Swans are “solutions that take us exponentially toward breakthrough” or “systemic solutions to global challenges, solutions that tap into positive exponentials.” They deliver “exponential progress in the form of economic, social, and environmental wealth creation.” As Elkington adds, “Too often, Black Swans take you exponentially where you don’t want to go, whereas Green Swans take you exponentially where you do want to go.”

A good example of a Green Swan, according to Elkington, is the adoption of electric vehicles. It started out very slow, out of sight for most people. But gradually, and largely propelled by Elon Musk, it has accelerated step by step. It has now reached the exponential part of the curve, the point of no return, where it is rapidly embraced at increasing speed, disrupting the entire car industry on the path toward creating environmental, social, and economic wealth.

However, this does not mean that Elon Musk, or Tesla are Green Swans. As it happens, the idea of Green Swans is often misunderstood. As Elkington stresses, people often mistakingly think that their venture is a Green Swan, or that they themselves are a Green Swan. “I often get business cards of people telling me they are a Green Swan. But they can’t be. What they mean is that they work on a sustainable solution that may or may not end up playing into a wider Green Swan trend. I call those, playfully, “Ugly Ducklings.” In reality, the Green Swan metaphor refers to the larger development they may be part of. Elon Musk isn’t the Green Swan, that’s the electrification of vehicles.”

Why Green Swans Matter, Especially Now

Green Swans matter because we need many of them in order to solve today’s global challenges. “Change as usual, incremental innovation, and even some radical innovation as we know it is not enough,” Elkington explains, “because the degree of change that we need in order to save our planet and the people living on it is at an entirely different scale. We need system-wide, global changes in the economy, politics, culture, technology, and so on. Green Swans reflect such breakthrough changes.”

One might ask whether we need yet another sustainability concept added to our vocabulary. We’ve heard terms such as the Sustainable Development Goals, the Triple Bottom Line, ESG, Regeneration, Circular Economy, various ISO standards, and so forth many times over the last decade. How does the Green Swan concept add to this?

“People often ask me this question and also whether the Green Swans idea is to replace one or some of them. But that’s not the point at all. It’s not supposed to be ‘the next big thing’ or to replace anything. It is one more necessary idea in our sustainability basket. We’re facing enormous challenges and need a rich vocabulary to communicate about them and an extensive toolset to solve them. More than many of the other concepts, Green Swans reflect the exponential systemic changes that our planet needs and how they develop.”

How To Create Green Swans

That brings us to the question of how Green Swans develop and what can be done to increase their number and speed of development. “As with Black Swans, the problem with Green Swans is often that you don’t know upfront whether you’re working on a Green Swan. You might or you might not be, but you only know once it’s there.” This, according to Elkington means that there needs to be room for a lot of different initiatives to explore and unfold.

But it’s more than merely the volume of initiatives. There’s a process too. As with many disruptive ideas, it starts with Rejection, the phase in which people simply reject the possibility of a Green Swan happening (think “people will never give up combustion engines”).

Rejection is followed by Responsibility, a phase where one or few leaders—corporate or governmental—start taking responsibility for the emergence of the Green Swan outcomes. Elon Musk’s decision to start Tesla, producing electric cars himself because no other car manufacturer would invest, is a good example.

Next comes Replication, a phase of scale-up where others join the bandwagon. In the electric vehicle case, it is when other, incumbent car manufacturers have decided to make the transition to electric vehicles as well.

Fourth is Resilience. In this phase, the Green Swan needs to be solidified and protected against possible disruptions, including wider systemic upsets, otherwise it may not last. For example, the current charging infrastructure for electric vehicles and the dependence on risky global supply chains ask for efforts to improve resilience. And think of the impact of the Ukraine war on supply chains.

Fifth and finally, there is the phase of Regeneration. This is the phase where the entire system shifts from a linear resource-consuming system to an increasingly circular, regenerative system that can sustain over time without harming our planet, even restoring it. In the case of electric vehicles—as well as in virtually every other case—this phase has yet to be tried properly.

What Can I Do?

While Black Swans happen unintentionally “to us,” Green Swans don’t. As the process above illustrates, they require the substantial, persistent and collaborative efforts of many actors to happen.

This all sounds vast and beyond the scope of any individual company or person. So, what can one do? According to Elkington “Any individual will find it difficult to move the needle. And if you say you’re going to do this over the next six months, that may be an illusion.”

Therefore, the main advice Elkington gives is to connect to others. “Find out who else may be thinking or working along parallel lines as you. Find out what they do, go out and talk to them, and—where it makes sense to do so—join forces to transform markets, not just products.”


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