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From the tragedy of the commons to having skin in the game

by Mathis Wackernagel, Co-Founder and President

In the second installment of our ongoing series “Three Decades & Counting: Insights from successes and failures in 30+ years of communicating about sustainability,” Mathis Wackernagel explores the perceptions and misperceptions of climate action and how we talk about it. Join the conversation below!

What’s holding back the sustainability transition most is not the fact that decision-makers do not know that we are systematically depleting the planet. The problem is that they think it is too costly for them to act. This may be one of the most damaging misconceptions we face.

Therefore, this is the shift we are looking for: from seeing “tragedy of the commons” to recognizing that we “have skin in the game.” Let me give you a few examples of the differences between the conventional “noble” narrative and the “necessary” narrative we believe would be far more effective in unleashing the sustainability transformation.

A summary of noble vs. necessary view of sustainability action

I believe… I am caught in misaligned incentives between humanity and my country/city/ company/ self. My incentives and humanity’s incentives are aligned.
Therefore… I bear the costs of reducing my carbon emissions, and all the benefits go to humanity. I don’t want to wait to ready myself for the predictable challenge of resource constraints and climate change.
In response… We need international commitments and noble deeds (with no benefits to myself). I see taking action as necessary and essential for my own success.
As a result… I wait for others to act, and find myself in perpetual stalemate. I act now and find opportunities and synergies to amplify my efforts.

Definitions. “Tragedy of the Commons”: Taking action benefits humanity, but costs me. “Skin in the Game”: My own fate is tied to taking action. Taking action is an investment into my own ability to thrive (and is also beneficial for humanity).

Most commentators today see primarily misaligned incentives, where what would be good for humanity comes at a cost to themself. But given that the calamites of ecological overuse ultimately affect our cities, companies and countries, don’t we have direct incentives to prepare our cities, companies and countries for the future we anticipate? This would mean that incentives between us and humanity are primarily aligned: investing in the sustainability transformation also has overwhelming benefits for the actor/investor.

Misaligned incentives, meaning what is good for me is not good for humanity, and vice versa, are technically called “tragedy of the commons.” They require “noble responses.” Noble actors only expect costs and no personal benefits. Being trapped in such tragedies of the commons is still the dominant view of the situation we are in. Since such tragedies require noble actions, they are typically relegated to Sunday afternoons, if ever.

Aligned incentives mean that my interest and humanity’s go together. Some express it as “people have skin in the game.” For those people, action is NECESSARY if not ESSENTIAL for themselves. Granted, some people still do not act, even if necessary (e.g., quitting smoking, maintaining a healthy diet, getting enough sleep), but having skin in the game makes action far more likely. But also, the sustainability challenge is characterized  by far more aligned incentives than what’s being recognized. That’s what we need to shift.

Any organization’s power, and particularly that of not-for-profit organizations, comes from helping people see aligned incentives, where they now misperceive misaligned incentives. This is what I am obsessed about these days.

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Creation of this content generously funded by the MAVA Foundation for Nature