Rephrase the speaker note

Author 1

December 7, 2018

Professor Frank Werner

Sustainable Finance

Speaker Summary: Capital Institute- John Fullerton

John Fullerton, founder and president of Capital Institute, discussed different ideas of finance. He started out by telling his background information, which I found interesting. He showed his passion for sustainability by explaining how after working in the finance world at JP Morgan for years, he decided that sustainability was more important. This passion showed throughout his speech.

An interesting topic John talked about was how everything is correlated. He showed a voting map from the 2016. The map shows mostly read in the middle states, with blue on the east and west coast. He then showed a map of the watershed, which is the different water lines across the United States. While one might think that these two things would not correlate, the map shows that the watershed and voting states are correlated. Fullerton explained that a lot of people in the middle states are being killed by the agricultural system, which reflects how they vote in the presidential election. This showed how everything is connected to everything.

John expressed this throughout his presentation. He discussed organized complexity, which is in between classical physics and statistics. It shows that things that happen are not “random” like many people say. Things are connected. He said that people commonly use the phrase “seeing is believing,” but he says that believing is also seeing. Some people believe something is true but do not see the truth or reason behind it. He used the example of markets; many people think markets are a magical tool used to find answers to issues including climate change. However, this isn’t the case.

He later discussed his latest work: Regenerative Capitalism. The paper discusses our current world view and economic system, as well as regenerative economics. Regenerative economics is application of nature's laws and patterns of systemic health, self-organization, self-renewal, and regenerative vitality to socio-economic systems. Usually, people think sustainability is the best place to be. However, there’s a step after sustainability which is regenerative. I had never thought about this idea before, but it makes a lot of sense. Regenerative is a continuing process. The example he used that I liked was cancer in the United States. Instead of pouring billions of dollars into cancer research, we should put that money into researching and learning how to make our immune systems healthy. Learning to make our immune systems healthy is a regenerative idea. The world should be regenerative, and able to renew itself through generations in a continuing process. Pope Francis even discussed this alignment with the regenerative world view in his letter Laudato Si’.

One of my favorite parts of his speech was his story about his dad. John explained how his dad, who served in Japan, would never talk about his experience or time in the war. However, story or question John asked his father, he would turn it back to the war. The war and the experiences he had there gave his father’s life meaning. This reminded me of my grandpa, who also grew up in the same generation. Although he does not talk about the wars, you can tell that his experiences there made him the man he is today. John explained how no generation, including his own, has had a purpose like that generation had. However, John thinks that our generation is going to have “real” meaning like his father’s. He explained how we were born into this purpose, and we should not shy away from the challenge the world holds for us. Our lives have a purpose, and we are going to discuss our experiences and purpose like his father talked about the war. As a college senior with no direction of where I want to take my life, it was reassuring that John felt he found his purpose in life, even after working in Wall Street for years. I think our generation, that is especially overlooked by older generations, will find its purpose in the world and make positive changes in the world.

Author 2

Speaker Summary – John Fullerton

7 December 2018

John Fullerton is the founder of Capital Institute. He worked at JP Morgan pre-merger. He talked abut his early exposure to impact investing and how it was controversial at the time of his exposure. John shared his traumatic experience on 9/11 and how that experience helped push him towards making a more positive impact on the world. He believes our economic system is flawed and wanted to change how the system is run. I think it makes sense how a traumatic experience like that can change how you think about the world and this was clearly the case with John.

Throughout his presentation, it was clear that John was very passionate about sustainability and his role in helping to address it. He asked the class what we thought the probability of a collapse would be within the next half century. And he asked where that collapse would stem from if it did happen. This was an important question and I think its important for us to think about. He talked about the study done at MIT that talked about the inevitable collapse of a world where population growth was exponential on a finite planet. This means that either population growth must stop, or resource throughput must change and neither of those has happened for us. I feel like these are things that we do not pay as much attention to as a society as we should because we just assume things are always going to work out. This mindset is okay until it no longer holds true, and that is the path we are approaching if we do not start to make dramatic changes as John pointed out.

John’s main speaking point was centered around a regenerative world. His points were different from what he called mainstream sustainability efforts. While these efforts are essential, they are insufficient in addressing the challenges we are facing. He believes are problems are much larger and stem from systems we currently have in place that must undergo wholescale changes. The universe is organized complexity. This entails a combination of classical physics and statistics. He called for a switch from reductionism to holism in our thinking. This was another look at how thinks work on a more holistic view. In terms of finance, we currently hold more of a reductionist view to simplify things that are complicated. However, this means we do not really have the best understanding of how everything works together. With the reductionist view comes unintended consequences that are hurting us. Therefore the concept of regenerative is so important.

One of the most important things John discussed throughout his lecture was changing how we think and the theories we believe. He compared it to when people believed the Sun revolved around the Earth or even when people thought the world was flat. Changing how we think about things and questioning our beliefs will help us to advance and change for the better. Sometimes we hold absolute truths that are not true, and we have to be willing to question those so that we may come out to the best understanding possible.

There are 8 principles in John’s regenerative economy. He talked about empowered participation and its relation to the inequality in our system. He talked about his toes and how their failure could lead to failure throughout his body, showcasing the importance of all body parts working together. In our financial system, inequality does not only hurt those who are on the low end of the totem pole, but it hurts the system. I thought this was a very important point because we often think about inequality as hurting those who are at the bottom. The way John pointed it out is that inequality is hurting everyone and the economy as whole. This makes sense and its better because that places the burden of fixing it upon everyone. Even those who are not directly affected have incentive to fix it because it will result in benefits for everyone involved.

I think it was interesting to compare his talk on regenerating to the C2C concept we talked about a few weeks ago. C2C is a great concept but, for John, it is not enough. He argues that we should work to not only reuse materials but to improve upon them and make them better.

Some quotes I found interesting:

You can’t be pessimistic or optimistic, you must put your head down and work

Stubbornly doubting the absolute truths of others - Socrates

This gives us a purpose that we should not shy away from

Author 3

Professor Werner

Sustainability & Finance

Speaker Reflection

7 December 2018

“Towards a Regenerative World” – John Fullton

John Fullton’s presentation about his life’s work and passion was inspirational and personal. His story is one that I hope many people will have someday. A story about how they wanted to see a positive change in the world and cared so deeply that they were willing to give up all that they know in order to find their own passion. Although John’s was initiated by the tragedy of 9/11, I hope that other people can have life changing thoughts inspired by less tragic moments. John’s experience and history in banking provided the background knowledge of the industry to understand the various areas that need to change and become more regenerative. It reminds me of the saying “keep your friends close and your enemies closer” although he may not have known it at the time, his work for J.P. Morgan enabled him to be where he is today. As John began speaking about the idea of not just sustainable innovation but regenerative innovation and changing the dynamic of the world to represent an organic and living organism, I was amazed and puzzled. Why have we not thought of this sooner? Nature has the amazing capacity to find the most efficient and best. Nothing is a dead end. The earth is connected through billions of cycles, regions, ecosystems and organisms that are all co-dependent on one another for their own survival. Nature has found the best way for the top of the food chain to give back to the bottom and has truly mastered the idea of a regenerative cycles of life and growth. Walt Disney was not wrong when they produced “The Lion King” and spoke so reverently of the circle of life.

As our human-centered world progressed we were overcome with ourselves and our own problems. Naively, we buried our heads in the sand and kept looking inwards for solutions to world hunger, pollution, consumption, water, gasoline, modern medicine and more. But, all we have to do is look up, appreciate what we have around us and learn from the world around us about how to become the most efficient and regenerative species on earth. Profit is not what we were made to create, so why do we care so much about it?

The more John spoke, the more I became on board with the idea. I know a main contributing factor to my passion and how I see the world is my faith. And as John described his own ideology, I saw a man who was describing what he believed in I saw a man that was describing his faith. John truly believes in his work, research and understanding of the world as a massive living system and how physics and science are the truth and light to fixing the consumption-based system we have created. I began to think about his idea as it’s own religion and came to one of the foundational principles that many religions share. Most religions have an explanation or some type of rational for why we die. Religion is sometimes said to be a way for people to overcome their fear of death in hope of salvation and a life beyond death. In a similar way, John’s idea of regenerative capitalism, economics, society and essentially a regenerative world is a way to cheat death. Our actions, systems and cycles will flow into one another in a more natural and succinct way. We will evade the death of our society and world as we know it, because at this rate we will not be able to continue in the dame lifestyle. As I accepted and understood his worldview as a religion, I came full circle as I remembered John was basing his entire structure and proposition off the idea of science, physics and natural systems. I found it ironic that I began the talk with admiration for science and technical thinking and concluded the presentation with a great appreciation for God. Author 4

Sustainability of Finance

Speaker summary-- John Fullerton

Prof. Werner

Dec 7, 2018 

Speaker summary : John Fullerton

Tonight, our guest speaker John Fullerton brought us a brand new perspective and view to consider sustainability and finance. The topic is “Towards a regenerative world”. In the beginning of class, we answer two questions. One is how do we the there will be a destroy possibility happen and other is what is the potential cause. There are four risks that we consider: ecological risk, political/social risk, economic risk, and financial risk.

Einstein said “the theories determine what we can or cannot observe”. According to John Fullerton, it is a more philosophical theory than people though.. we need to think the questions we never thought before. And believing is seeing. The example is there is two map, one is the voting map and the other one is the watershed view. These two maps are really similar in their layout. This shows us they are correlate and the agriculture system destroy plant ecological.

Most of the universe is organized complexity and we can use physics theory to explain the finance world. The classical physics, which is single cause. The example is central bank lower or increase interest rate to accelerate or lower the economic. Intertwined cause- predictable patterns is the organized complexity, which means everything is connected like the maps mentioned before. Another is Statistics which shows the disconnected causes. It means the uncertainty and the tools we use.

We should use a new way to think, from reductionist to holistic, which means the universal principle that explains matter, life, spirit. For example, Alibaba do not take profits from the stores directly but get the network benefit. We are not lining in an era of change, This century is different from last four centuries, We are living in a change of era. It is a similar process from medieval era to modern era and modern era to integral era. Because it is both a way the change the world view.

Definition of Regenerative Economics is the application of nature’s laws and patterns of systemic health, self-organization, self-renewal, and regenerative vitality to socio-economic systems. Economic is going from degenerative to regenerative design. Sustainability is in the middle. This is the outcome of regenerate process but not the goal for regenerative process.

The most important principle in principle of a regenerative economy is in right relationship. We used to think the order is planet to economy to finance, which is wrong. The correct sequence is finance to economy to the planet. The second important principle is innovative, adaptive and responsive.

The five fundamental flaws of modern finance include finance ideology, confusion of investment with speculation, limitation of markets that can help solve the climate change problem, agency problem of misaligned incentive and limits to investment.