In 2015 Mikkel Larsen and I published a paper titled Integrated Reporting – could system and holonomic thinking help? Mikkel is the Group Head of Tax and Accounting Policies at DBS (Development Bank of Singapore) and in a personal capacity he is the chair of the IIRC banking group (The International Integrated Reporting Council).
The IIRC Framework has as its stated vision “…a world in which integrated thinking is embedded within mainstream business practice in the public and private sectors, facilitated by Integrated Reporting (<IR>) as the corporate reporting norm. The cycle of integrated thinking and reporting, resulting in efficient and productive capital allocation, will act as a force for financial stability and sustainability.”
After reading Holonomics Mikkel got in touch with me to discuss jointly how holonomic thinking can inspire the development of new more holistic measures for “integrated reports” which articulate how companies can provide long term sustainable value.
In our paper we introduced holonomic thinking into the Integrated Reporting community, as I we both believed that it represents a powerful way of thinking about organisations as living systems. The four dimensions of our Holonomics approach are:
Systemic – Understanding the organisation as an organic and dynamic system of interrelated organs.
Experiential – Understanding the lived experience of each person – employees, management, leadership, stakeholders and the community.
Meaningful – Understanding how shared meaning emerges in the organisation over time, allowing the organisation to be able to become agile, efficient and transparent – an authentic whole.
Ethical – Understanding how human values are the foundation of authenticity, agility and change.
One key aspect of our Holonomics approach, which is described in our book, is the way in which it shows both the importance and need for organisations to undergo profound shifts in consciousness, but also practical interventions to actually promote and facilitate this shift in consciousness. Holonomic thinking demands a shift in consciousness from the analytical to the intuitive; one that not only is able to understand the parts of a system, but at a deeper, intuitive level of perception, is also able to understand the relationships and processes within that system – not from the perspective of a whole which is superior to the parts, but from one which is able to encounter the whole through the way in which it comes to presence in the parts.
This mode of consciousness sees each part in a system as an expression of the whole, the whole of which can only be the whole because of the parts, and the parts of which can only be parts because of the whole.
Holonomic thinking helps resolve traditional conflicting demands from diverse shareholders and stakeholders in a business ecosystem by helping enterprises shift their focus on short-term and bottom-line targets, seeing their organizations mechanistically, as a collection of parts, in which each part can be controlled and managed to achieve predictable outcomes, to a dynamic systemic view which sees ‘results’ as “emerging from a complex, non-linear process, in which people belong to, and patiently nurture, a web of relationships.
I am therefore extremely pleased to be able to share this announcement made at the 5th International Conference in Amsterdam this week, that Reporting 3.0 have released their Transformation Journey Blueprint – as well as a Blueprint for Integrated Accounting and a Blueprint for Integral Business Models – to guide all actors to contribute productively to the shift from degenerative to regenerative economies.
International Integrated Reporting Council CEO Richard Howitt opened the conference with a keynote unveiling an exciting new partnership to accelerate this transition.
This week, we are announcing that the IIRC and Reporting 3.0 are beginning collaboration on a new White Paper on multi-capitalism, which we believe can be an important next step in developing a deeper understanding of the implications of a multi-capitalist approach, as well as helping embed integrated, multi-capital thinking more widely in business,” said Howitt. “As unapologetic multi-capitalists, the two organizations will set out a pathway for a transition to system change and to articulate the role of multi-capitalism in sustainable development.”
To articulate these ideas in more depth, Howitt and Reporting 3.0 Managing Director Ralph Thurm co-authored an article published today on Thomson Reuters.
“There is no sustainable business in an unsustainable world,” says Thurm. “To achieve intergenerational sustainability and prosperity for all, Positive Mavericks in key sectors across the board – business, investment, government, philanthropy, civil society, academia, and others – must radically collaborate to transform our global economy into a multi-capitalist operating system.”
Reporting 3.0 Senior Director Bill Baue, who will co-manage the project going forward, explains in more depth:
“Multi-capitalist thinking reveals how ongoing value creation requires managing both horizontal and vertical dependencies: on the former, dynamic balance of all capitals upon which business models depend, in order to maintain healthy stocks and flows; on the latter, coordination amongst actors and institutions at different levels, to manage the aggregation of individual impacts into collective effects on the carrying capacities of capitals in the Commons,” Baue said. “This expanded scope synthesizes broader societal factors that are integral to holistic management and decision-making.”
Reporting 3.0 is also celebrating this fifth Conference (centered on the theme Context for Thriveable Transformation) by releasing three final Blueprints to fully round out its “Work Ecosystem”: the Accounting Blueprint, New Business Models Blueprint, and Transformation Journey Blueprint.
- The Accounting Blueprint, lead authored by Reporting 3.0 Steering Board and Operating Team Member Cornis Van Der Lugt, proposes new Integrated Accounting featuring multi-capital, multi-layered balances sheets, income statements, and statements of long-term risks and value creation.
- The Final Report of the Blueprint can be downloaded here.
- The New Business Models Blueprint calls on startup entrepreneurs as well as intrapreneurs in existing companies to design new Integral Business Models that scale up New Industry Ecosystems and New Integral Economies.
- The Final Report of the New Business Models Blueprint can be downloaded here.
- The Synthesis Blueprint distills all four Blueprints (also including the Reporting Blueprint and Data Blueprint released at last year’s Conference) into a singular statement, and unveils a Transformation Journey Program (structured around the metaphor of a mountain climb) as the avenue for organizations of all stripes to collaborate on piloting and activating Blueprint Recommendations.
- The Final Report of the Synthesis Blueprint can be downloaded here.
Speaking about the initiative, Antony Upward, Founder, Flourishing Enterprise Innovation said that “Integral Business Model designers must apply design principles derived from the same latest trans-disciplinary systems-based scientifically credentialed knowledge, ethical and human rights frameworks that informed the design and the questions in the tool. I am contributing to the Reporting 3.0 community’s work because we share a vision: to bring about a future where all enterprises are designed with the intention to do good to do well – striving together to ‘sustain the possibility for human and other life to flourish on this planet for seven generations and beyond,’ as John Ehrenfeld of MIT says – socially beneficial, environmentally regenerative and financially viable.”
The White Paper on Multicapitalism (and the carrying capacities of the capitals) will be a joint publication of Reporting 3.0 and the IIRC scheduled for release in 2019 that will lead to a roadmap on how integrated thinking in companies can be translated into a system with multi-capitalism at its heart for markets around the world.