What environmental procurement can learn from the economics of Dungeons & Dragons

By Grace Edinger, the Senior Manager of the Restoration Economy Center

You and your band of heroic friends approach a small settlement up ahead on the cobblestone path you’ve been following for days now. A massive, stone castle surrounded by a small merchant settlement opens up in front of you as you emerge from the dense forest. The town looks…rough. Almost in a state of disrepair, not what you expected. 

Sitting on a small, rotting stump before you is an old graying goblin in royal purple robes. He beckons you closer. 

“I’ve been waiting for strong adventurers like yourselves for some time now. Thank goodness you’ve come. Time is running short,” says the quest giver. 

“Certainly,” you all reply, eager to take on a new challenge and prove yourselves. 

“Inside this castle lies a labyrinth of monsters and mayhem, all protecting a very powerful, very magical sword. Escape with the sword, and it’s yours to keep. Use the sword to thwart the evil queen who reigns over these lands, and receive 200 gold pieces as a reward. Here, take a few up front to help you gather any supplies you might need.” He hands you 5 gold pieces. 

Nerds around the world, myself included, encounter situations like this all the time in our Dungeons & Dragons games. Throughout the fictional lands, characters lay in wait for bands of heroes to come and save them, usually offering some sort of monetary or magical reward for completing the mission. 

These agreements all tend to work in the same general way. The quest giver, in our case the goblin, promises a set reward for successfully completing a mission. Oftentimes payment is negotiated until both parties are satisfied but the vast majority, if not all, of the money, isn’t paid out until the quest is finished and verified in some way. 

It’s a straightforward and intuitive system. You do the job, you get the reward. In our case, that means thwarting the queen and bringing back some sort of proof, perhaps her crown or something else of significance. 

By structuring payment in this way, our goblin friend is assured that the heroes won’t just take his money and run, and that what he needs done actually gets done (queen thwarted). The goblin doesn’t tell the group how to thwart the queen, just that he wants her out of the picture. It’s up to our heroes to figure out how to succeed in whatever way they see fit. 

Why am I spouting off about D&D on the EPIC blog, you might ask?

This type of agreement, or contract structure if you will, is essentially the same thing as outcomes-based procurement or Pay for Success, a type of government contract that is becoming more and more prominent in the environmental sector. State, local, and federal governments are beginning to shift their contracts to emulate this intuitive model for purchasing environmental progress, where the majority of payment is held until the project has been successfully completed and verified. 

The quest giver (a government body) and band of heroes (ecological restoration organization) negotiate a price per unit outcome like pounds of phosphorus, impervious acres treated, etc. The band of heroes then go off on their quest to restore the lands, securing permits, designing the project, and executing it all themselves.  

Like the diverse crew of adventurers, the restoration organizations bring together a swath of experts and subcontractors as needed, tackling the project holistically from the get go. That’s not to say the quest giver doesn’t pop in to make sure they’re on track and that goals are aligned, but their involvement in direct project oversight is less intense. 

This is quite different from traditional ecological procurement structures, which chop up the project into a bunch of small pieces, each managed by separate entities which create time delays, communication issues, and siloed work environments. 

Imagine that our goblin quest giver mandates that the band of heroes split up, and each individually handle a component of retrieving the sword and thwarting the queen. Akin to a relay, each party member must return to the goblin, show proof they did their part, and receive their portion of the payment before the goblin allows the next leg of the mission to begin. 

First, the sneaky rogue is to stake out the castle, assessing the property for traps and guards. Once a full threat assessment report is delivered to the goblin, the knight can then infiltrate the castle with the goal of retrieving the magic sword. 

But what if the knight can’t read the rogue’s scrawled handwriting? What if their noisy metal plate armor notifies guards that the rogue didn’t perceive, being so stealthy? The knight gets ambushed, alone, and the mission is over. Long live the evil queen.

It seems totally preposterous when spelled out in this way, but this process is what happens for the majority of government funded ecological restoration in this country. In reality, it’s even more complicated. It’s like if the rogue has to come back to the goblin every few minutes to give a progress report and receive reimbursement for those few minutes of time. The inefficiency is astounding.

Let’s return to our original scenario, where the goblin pays 200 gold pieces at the end, and gives them 5 gold up front for start-up costs. What happens if our band of heroes needs 15 gold pieces to purchase all of the supplies they need before going after the evil queen? The quest giver only gave them 5! What could they possibly do? 

Secure financing. By knocking on tavern doors or seeking out wealthy merchants, our band of heroes can ask for the remaining 10 gold they need to buy supplies, and promise the repayment of 12 gold upon return. Again, an easy and intuitive solution. 

Similarly, restoration firms secure investments to pay for the costs of the project until that final payment is given, with a healthy return included. 

By shifting the 200 gold payment until the end, the queen is thwarted, the band of heroes can play off of one another’s skill sets, the goblin gets what he wants, and a merchant makes a little extra coin. It’s a win-win situation. 

All this is to say that I’m for simplifying and streamlining the ability for governments to purchase ecological progress and hope this goofy scenario helps underscore the importance of government contract structures. 

How quests are given can make an immense difference. Fast-paced, large scale restoration doesn’t have to be fantasy. 

The Restoration Economy Center, housed in the national nonprofit Environmental Policy Innovation Center (EPIC), aims to increase the scale and speed of high-quality, equitable restoration outcomes through policy change. Email Grace if interested in learning more, or consider supporting us!