"Futureproofing": Real Options as a Conceptual Tool in the Financialization of Everyday Life

The COVID-19 pandemic spotlighted uncertainty in people’s lives and a desire to “futureproof”: anticipate, plan and mitigate unexpected future shocks. Originating in financial derivatives modelling, real options have gained traction over the last two decades as a decision-making tool that captures the flexibility embedded in projects across various industries such as real estate, pharmaceutical R&D, and natural resources. This workshop aims to start a conversation about mobilizing real options – options that are not traded on financial markets – as a conceptual tool to understanding how financialized thinking seeps into everyday life.

Three case studies introducing real options in infrastructure, human resources management, and climate change will be explored to highlight links between uncertainty and flexibility in real options analysis. Unlike options on financial instruments, real options are meant to consider the uncertainties of operating in changeable conditions.

The trade-offs, readjustments, and the fickle environment of real options are closer to the fluctuations of everyday life – from the micro to the macro – than the theoretically frictionless world of perfect markets. In this way, real options may offer insight into how financialized thinking impacts everyday decision-making under uncertainty. This workshop invites participants to discuss whether real options are conceptually productive and how real options can be utilized in non-financial research and analysis.

Speaker

Alia Nurmohamed is a PhD student in Social and Cultural Analysis at Concordia University. Alia’s research focuses on how conflicting and intersecting responsibilities can lead to feelings of grief in motherhood. Prior to joining the Department of Sociology & Anthropology, Alia worked for 10 years in real estate private equity and consulting. She holds a BComm in Finance from McGill University, an MBA from the University of Warwick, and BA in Sociology from Concordia University.