Tariffs and Doughnuts

Can a cutthroat economy still reward businesses for doing the right thing?

By Peak Design

June 2^nd, 2025

Annie Nyborg here, Head of Environmental and Social Impact. Peak Design, like most other U.S. product companies, has been busy grappling with the looming tariffs and what they might mean for our business. This comes at a time when the industry has already weathered a duration of economic headwinds and slower sales. It is within this context that someone recently told me that the work I do - environmental and social impact - is a luxury.

I nodded, acknowledging I understood what they meant: that especially in times of economic uncertainty, we need to prioritize profit generating activities in order to keep the lights on. No margin, no mission. I get it…but it still didn’t sit well with me. While keeping the company afloat is imperative, and knowing these tariffs are an existential threat to many businesses, labeling our environmental and social initiatives as a luxury is the fundamental shortcoming of our current economy.

We build and operate our businesses today based on the unassailable truth of never ending growth; that up-and-to-the-right is the one way, the only way. But is it? Despite wanting economics to be a science, it’s not. It does not abide by the laws of nature and therefore leaves room for innovation in a way that physics does not. We have the ability to challenge the assumptions and rewrite the textbook.

I’ve recently been learning more about economist Kate Raworth’s Doughnut Economics framework. Instead of thinking of our economy in terms of the up-and-to-the-right graphic (ie GDP) that we all learn in Econ 101, she challenges us to think about our economy in terms of a doughnut. The inner ring represents a social foundation, which ensures that no one lacks life’s essentials; the outer ring represents an ecological ceiling of planetary boundaries protecting Earth’s life-supporting systems. The economy we need is the sweet spot in between those rings - one that makes sure humans have what they need while also not blowing through planetary boundaries that would make life ultimately unsustainable.

Despite what you might be thinking, I'm not a naive idealist. I am fully aware that our current financial, political, and cultural systems are all built on the premise of continual growth and that shifting away from that is near unimaginable. But it is clear that the emphasis on growth is not resulting in the social or environmental outcomes we want and need. The naive idealists are those who still think the current growth model will eventually solve our problems.

I’m a pragmatist: the system we have is not working the way we need it to so it's time to find a better solution. Undoubtedly daunting, that prospect should still excite economists, business folks, and sustainability professionals because we get to play a role in designing our future economy. The opportunities for creativity and innovation are endless, and that’s a lot of fun.

Sustainability professionals are actively working to design a better system but tariffs, and economic headwinds more generally, will put the test to your company’s values. I often get asked, “How do you demonstrate that your environmental and social initiatives lead to higher revenue? What is the business case?” I usually ramble about brand loyalty, next generation consumer trends, employee retention, liability, yadda yadda. All true, but the fact of the matter is that often there is no direct line to the bottom line. There is no clear profit-based business case. Doing the right thing isn’t always a “win-win” and it's time we embrace that instead of trying to do the gymnastics necessary to argue the business case. I’d love to get to a point where we do the right thing because it’s the right thing.

I understand that within our current economy, many companies don’t have the ability to give equal footing to profit, people, and planet. I understand why someone referred to my work as a luxury. But we need to collectively advocate for a world where it is no longer considered a luxury.

What does this all mean for Peak Design? For now, it means we will continue navigating these uncertain financial seas while maintaining our social and environmental commitments: being a 1% for the Planet member, manufacturing in Fair Trade Certified factories, maintaining our B Corp certification, advocating for our lands and waters, taking responsibility for our emissions via The Climate Label standards, increasing our use of recycled and Bluesign materials, and nurturing a positive workplace for our employees.

But I believe there is more we can do to help usher in a more regenerative and distributive economy. What that will look like for Peak, I’m not yet sure. But I know there are better ways of doing business and we will continue exploring what’s possible. For all you values-driven leaders and sustainability professionals out there feeling the heat, I see you and I’m excited to continue our journey together in designing a better economy, one in which people and planet are not a luxury.