The Capital Institute, an organization that will bridge mainstream finance with the new economy movement and related efforts to rethink the nature of economics and our financial institutions, today announced its formation. The Institute is a private, non-partisan, not for profit think tank, that is dedicated to stimulating the interaction and action of leaders, scholars, and society by raising awareness of the need to harness the power of capital and markets to advance a just, resilient, and sustainable economic system that will improve lives and preserve Earth's life support systems.
'We face an urgent need for economic transformation of historic proportions at a time when political leadership is weak and Wall Street is understandably distrusted,' says John Fullerton, President of the Capital Institute. 'Leadership from enlightened capital has begun, manifesting itself in multiple forms and ideas. Economic transition to a new economy will occur only through the transformation of finance, beginning with clarity on the purpose of the financial system. Capitalists, and society at large, must ask, what is the purpose of capital?'
For the most part, the work and reform agenda of the new economy, sustainable capitalism, and other related movements, has existed well outside mainstream finance and economics and remains disconnected from the core financial reform agenda. This deprives the current financial recovery dialogue, which will set the global economy's course for years to come, of the vital principles, ideas, and proposed actions required to catalyze a transition to a just, resilient and sustainable economic system. Similarly, the disconnectedness of these movements from the financial mainstream materially inhibits their ability to harness and redirect the power of capital and markets that is necessary to achieve the desired results. The Capital Institute, with its roots in the financial mainstream and a deep understanding of the issues championed by advocates of a socially just and ecologically sustainable economy, will bridge this gap.
Dr. Robert Johnson, Executive Director of Institute for New Economic Thinking and member of the Capital Institute's Board of Directors, commented, 'The rebuilding and reform initiatives arising from the global financial crisis present a rare opportunity to address large-scale systemic issues in finance and economics that go well beyond the banking reform agenda. The global economy is now consuming almost one and one half times the earth's capacity to regenerate the resources upon which all life depends. Capital and markets are key drivers of our state of unsustainability, but properly harnessed, they can fuel the transition to a just and sustainable economy. The Capital Institute exists to ensure that it happens.'
The Capital Institute is focused on four critical leverage points for systemic change: Real Investment, Metrics, Money, and Advocacy.
- Real Investment: Develop a new investment framework, new tools and instruments, and a systematic methodology that aligns real investment flows with the requirements of a sustainable and just economic system;
- Metrics: Devise and enhance new approaches to integrate ecological function and social well-being into core measurement metrics, and reporting and valuation tools for the public and private sectors;
- Money: Devise and illuminate complements and alternatives to our highly centralized, debt based monetary system that will improve critical feedback loops linked to real wealth creation and better serve society’s needs, while at the same time, improving financial system resiliency;
- Advocacy: Raising consciousness and advocating for a transformation of finance that will align capital flows with the sustainability and social justice imperatives we face.
Through this work, The Capital Institute seeks to facilitate the development of a financial system that:
- Respects the physical boundaries of the biosphere while promoting sustainable development;
- Serves as a subsystem of the economy, not the master of it;
- Is resilient, fueling the transition to a sustainable economy rather than periodically threatening economic stability;
- Uses new tools and metrics to manage the quality and quantity of growth and development that will drive the transition to a sustainable economy.
'We are fast running out of time, in part because we are consuming nature's capital far in excess of regeneration rates,' commented Gus Speth, Advisory Board member, Professor of Law at the Vermont Law School, Distinguished Senior Fellow at Demos, and former Dean of the Yale School of Forestry and Environmental Studies. 'The Capital Institute is acutely aware that we are on an unsustainable course, and it is raising awareness and stimulating action with the goal of a major course correction before it is too late.'
Key to the achievement of the Capital Institute's goals is a core set of people who can bridge mainstream business and finance with cutting edge sustainability thinking. The Founder and President of the Capital Institute, John Fullerton, has extensive experience in finance and investment, having served 18 years at JPMorgan prior to the merger with the Chase Manhattan Bank. Currently, Mr. Fullerton is also the Principal of Level 3 Capital Advisors LLC, an investment firm focused on high-impact sustainable private investments. He is a Director of the New Economics Institute, Investors' Circle, Grasslands, LLC, New Day Farms, Inc., an Advisor to Natural Systems Utilities, and a participant of the UNEP Green Economy Report. The Capital Institute’s Board of Directors, Advisory Board, and extensive network, represents a diverse group of leaders and cross-disciplinary scholars, all personally committed to the imperative of a sustainable economic system.
The Capital Institute has also announced the formation of its Board of Directors and Advisory Board; for details, please visit the Institute’s website.
About the Capital Institute
The Capital Institute stimulates the interaction and action of leaders, scholars, and society by raising awareness of the need to harness the power of capital and markets to advance a just, resilient, and sustainable economic system that will improve lives and preserve Earth’s life support systems. As a think tank rooted in traditional finance, the Institute engages in research, project leadership and sponsorship, education, advocacy and consciousness-raising initiatives to bridge the gap between the new economy movement and mainstream finance. For more information please visit www.capitalinstitute.org.