Five Capitals Framework and Generational Sustainability

Introduction

Much appears to be riding on the earth's future. The leadership of coming decades must be prepared to confront challenges that have no historical precedent. A major issue will be society's ability to sustain itself amid conditions of resource scarcity. The purpose of this essay is to investigate the next generation's capacity to carry the torch of sustainability as it relates to the five capitals framework. These capitals include natural capital, human capital, social capital, manufactured capital, and financial capital. The essay first presents general background on sustainability before addressing each of the five capitals and their relationships to one another.

Shott (2012) argued that a new attitude must be adopted by coming generations. He placed the responsibility squarely on young people because of their unique circumstances: "the often maligned Y-Generation is growing up in an age of abundance with regard to interconnectivity and access to knowledge. For the first time in history, young people have the tools of creation and implementation in their hands."

Background: Sustainability and the Next Generation

History, however, depends on surviving, and surviving depends on sustaining. Sustainability, therefore, is the key to a bright and healthy future. Some observers have adopted a desperate tone, introducing fear and anxiety into the public consciousness. Confino (2011) wrote: "Hope springs eternal and particularly when it comes to a belief that the next generation will learn from the mistakes of those who currently hold the reins of power. This is especially so with the issue of sustainability. While the profligate western Generation X baby boomers hid behind short-term prosperity and failed to act on the destruction being wreaked on the planet, the prayer is that Generation Y will get us out of the hole we have dug for ourselves."

One solution derives from a group called the Forum for the Future, which has developed a framework dividing sustainable progress into five distinct capital categories. Each category is intended to address the most important problems related to creating and maintaining a sustainable environment. The group proclaimed: "Any organization will use five types of capital to deliver its products or services. A sustainable organization will maintain and where possible enhance these stocks of capital assets, rather than deplete or degrade them. The model allows business to broaden its understanding of financial sustainability by considering how wider environmental and social issues can affect long-term profitability."

Natural capital is another term for what has historically been called natural resources. Generations X, Y, and Z must come to understand the powerful forces that will dictate how natural resources are allocated in the future. The earth, as large as it is geographically, has been effectively shrunk by air travel and the internet. Resources such as oil, water, farmable land, and clean air are global resources, not local ones. Future leaders must recognize that decisions made in one region inevitably affect the natural capital available to people across the world.

Natural Capital

Within this new paradigm, fresh perspectives on human capital must be considered to sustain the earth's future. Human capital encompasses the health, knowledge, skills, emotional output, and capacity to form meaningful relationships within human society.

Human Capital

Unfortunately, this resource has been strained by rapid population growth over the last fifty years. As Ehrlich, Kareiva, and Daily (2012) observed, since all individuals inevitably affect Earth's life-support systems—though in different ways and to varying degrees—it is in everyone's interest to reduce, ethically, both the size of the global population and per capita impacts. The central uncertainty in humanity's future lies in how equitable the pathways chosen for that rescaling will be, the degree of overshoot that occurs, and the amount of irreversible damage that overshoot inflicts on Earth's life-support systems.