What is R*?
A complete guide to understanding R*—the universal index that measures whether an institution is strengthening or decaying over time.
The 60-Second Version
Imagine you're a donor choosing between two hospitals to support.
Hospital A has impressive annual reports—lots of patients treated, new equipment purchased. But you notice they've had three CEOs in five years, rely on a single government grant that could be cut any election, and struggle to retain nurses.
Hospital B has modest numbers but stable leadership, diversified funding that matches their 10-year building plan, and a training program that produces more nurses than they need.
R* gives you a single number to capture this difference. Hospital A might score R* = −0.3 (fragile, likely to weaken). Hospital B might score R* = 0.5 (regenerative, likely to strengthen).
R* answers the question: "Is this institution getting stronger or weaker over time?"
Why Do We Need This?
Every era has tried to measure institutional health. Each approach captures something important—but misses the core question.
Financial Ratios
Balance sheets and P&L statements
Limitation: Measures money, not mission capability
Performance Metrics
KPIs, outcomes, outputs
Limitation: Snapshot in time, misses trajectory
ESG Scores
Environmental, Social, Governance
Limitation: Compliance checklist, not capacity measurement
Impact Measurement
SROI, theory of change
Limitation: Project-focused, ignores institutional health
R* Index
Structural + behavioural regeneration
Trade-off: Requires new data collection practices
The Core Insight
The Old Approach
Traditional metrics ask the wrong question:
- •"How much did you do?"—outputs and outcomes
- •"How efficiently?"—cost per beneficiary
- •"What's your governance?"—board composition
These are snapshots. They don't tell you if the institution will exist in 20 years.
The R* Approach
R* asks the fundamental question:
- Structure: Is the design resilient?
- Behaviour: Is capability growing?
- Trajectory: Strengthening or weakening?
R* measures regenerative capacity—the ability to sustain and strengthen over time.
R* operationalises concepts from Regenerative Cycle Architecture and Alignment Capital—specifically the Δ (decoupling) and Λ (alignment) operators. It turns abstract theory into measurable assessment.
Read the full R* paper →How R* Works
R* combines two dimensions: how well you're designed (structural) and how well you're performing (behavioural).
Structural Score: "Is the design resilient?"
Three factors that measure architectural strength:
Decoupling
How insulated from external shocks? (political cycles, market crashes, funding cuts)
Alignment
Does funding timing match mission needs? (5-year projects need 5-year money)
Recycling
Does capital return for reuse? (or does it disappear after one use?)
Behavioural Score: "Is performance improving?"
Three factors that measure operational trajectory:
Capability Gradient
Is competence growing or shrinking? (talent retention, skill development)
Stability
How consistent is performance? (erratic vs steady results)
Mission Completion
What % of initiatives reach their goals? (vs abandoned mid-cycle)
Reading Your R* Score
R* produces a score from −1 (dying) to +1 (thriving). Here's what each range means:
Example: Underfunded hospital losing staff yearly
Example: Grant-dependent charity between funding cycles
Example: New organisation finding its footing
Example: Community bank with growing member base
Example: Dutch Water Boards (800+ years operating)
Where R* Applies
R* works across any institution type. Here are examples from different sectors:
Health Systems
A hospital with stable funding, strong training programs, and leadership succession plans might score R* = 0.4. One with annual budget uncertainty and high turnover might score R* = −0.2.
Key question: Can this hospital serve patients in 30 years?
Climate Organisations
A climate fund with 50-year capital commitments and diversified income might score R* = 0.6. One dependent on a single government that changes every 4 years might score R* = −0.1.
Key question: Can this fund infrastructure that takes decades to build?
Community Banks
A community bank with growing membership, patient capital, and community governance might score R* = 0.5. A conventional bank focused only on quarterly returns might score R* = 0.1.
Key question: Will this bank serve the community in multiple generations?
Research Institutions
A university with endowment income, tenure systems, and knowledge preservation might score R* = 0.7. A startup-funded lab with 18-month runway might score R* = −0.3.
Key question: Will knowledge be preserved and built upon?
Common Questions
How is R* different from ESG scores?
ESG measures compliance and risk mitigation—do you have policies in place? R* measures regenerative capacity—can you sustain and strengthen over decades? An institution could score well on ESG (good policies) but poorly on R* (fragile funding, no succession planning).
Can a high-performing institution have a low R* score?
Yes. A charity might be doing excellent work right now but be entirely dependent on one major donor. If that donor withdraws, the charity collapses. High current performance + fragile structure = low R*.
What data do you need to calculate R*?
You need information on funding sources and timelines (structural) plus historical performance data and staff trends (behavioural). Many organisations already have this data—it just needs to be analysed through the R* lens.
Can R* be gamed or manipulated?
The behavioural component uses historical data, making it harder to fake. More importantly, R* measures things that are genuinely hard to fake—you can't pretend to have stable leadership or diversified funding.