Tackling Uncertainty Through the IF Initiative’s Physical Approach to Scenarios

IF Initiative

How can you plan for your business and business environment in a world with finite resources and facing planetary boundaries?

Working with a consortium of about twenty companies and six research teams, IF Initiative has developed four scenarios for our economies, as well as an original methodology based on systemic modeling of the major economic sectors on a global scale.

This approach makes it possible to compare sector-specific growth projections with available resources and the resulting pressures on the climate and natural ecosystems.

Issues

Our economies are currently facing a series of simultaneous and interconnected crises: climate disruption, geopolitical tensions, and technological disruptions are converging in a systemic way. These changes are permanently redefining the operating conditions for businesses by introducing significant and fundamental physical constraints.

In fact, 58% of French executives cite economic unpredictability as their top concern: strategic management reaches an impasse when traditional forecasting tools—which focus on the short term and financial indicators—fail to anticipate these physical constraints or their systemic impacts.

It is therefore necessary to move beyond the illusion of predictability and envision the company’s future within prospective scenarios constrained by planetary limits in order to guide strategic decisions and make the right investment choices.

Our Method

The IF Initiative scenarios describe the transformation of economic activities (production and consumption) on a global scale, broken down into 11 macro-regions.

Four categories of determinants are used to explore and characterize possible futures:

Changes in Lifestyles (Consumer Expectations and Preferences)
Geopolitical Contexts and Their Impact on Constraints on Access to Resources and Regional Development
Physical constraints on human societies: various climate targets (GHG budgets) and other planetary boundaries, resource constraints (minerals, fossil fuels, water), inertia in infrastructure transformation, and climate feedbacks on human activities
Improving the efficiency of technologies (energy, materials, environmental impacts)

By calculating the “energy, material, and environmental” footprint of economic activities, these determinants make it possible to identify transformations that are consistent with and compatible with these physical constraints:

of the request
the production system, its output, and the associated technologies used

The IF Initiative scenario-building method thus makes it possible to develop final scenarios that are physically feasible and that highlight the material interdependencies among economic activities and the factors that determine their evolution.