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Six Big Ideas for the Next Economy

Pearl Leung

Pearl Leung

Digital Marketing Specialist

At CSI, we believe we need an economy that is regenerative, equitable, and prosperous for all. Since 2012, we’ve been supporting nonprofits, social entrepreneurs, activists, and advocates as we work toward this Next Economy together.

The COVID-19 pandemic has made it impossible to ignore the failings of our current systems. Racism, poverty, the climate emergency: every time we look at a problem, we find our economic structure holding us back. If we’re going to make the world better, we need to design an economic system that puts people and planet first.

Luckily, many people and organizations from around the world have the same idea. They’ve been innovating new solutions, championing community-based, circular, participatory, equitable models that prove a Next Economy is possible.

Next Economy Conversations powered by Fiix is an opportunity to meet these leaders and hear about the solutions they have built and implemented. Tonya Surman, CSI CEO and serial social entrepreneur, facilitates the discussion, incorporating questions from the live audience. These conversations help us all learn, reflect, and integrate these ideas into our own efforts to build the Next Economy.

2021 is going to be a year of recovery, and we need big, bold ideas to get us started. We’ve chosen some highlights from each of our past events to cover in this blog, but if you want to fully immerse yourself in their work and optimism, you can watch all our Next Economy Conversations in full here.

On This Page

Failing so we can succeed

For our first Next Economy Conversations, we asked Bill Young to join us for a discussion about how he founded Social Capital Partners and why failure is necessary in creating systems-level solutions.

The thing about systems change is: it’s risky.

“Most funders don’t like funding things that aren’t working,” said Bill. “So the tendency is ‘let’s do things that will work.’”

Social Capital Partners is lucky to have independent funding. It means they have the freedom to experiment, to push boundaries, to do things that are inherently really, really hard.

“We flipped the script and said ‘no, we aren’t succeeding unless we are failing,’” Bill explained. “We will fail because we are trying stuff that nobody else is going to try. And that’s our role.”

They’re always aiming for the greatest impact they can have.

“How do we transform this economic landscape in the most powerful, equal way? How do we solve inequality? If we saw that what we were doing wasn’t going to get us there, whether it was branded a success or failure, it didn’t matter to us.

“To us, it’s kind of like a maze. In the centre of the maze is the magic of the biggest impact you could possibly have. To get to the center, you hit a lot of dead ends. You need to hit those to get to the centre. So we never look at failure or success as either failure or success. We look upon it as part of the road map on the way to have the most impact we possibly can have. ‘Is this the route to get there?’ If it isn’t, we change. Success and failure has nothing to do with it.”

Creating community-based solutions

Jeff Cyr of Raven Indigenous Capital Partners joined us in June to discuss what Community-Driven Outcomes Contract (CDOC) are and how they are serving the Indigenous community. This innovative new investment vehicle is changing the game in Canada — connecting social finance with deep-rooted respect for community.

The idea of an Indigenous intermediary came to Jeff a few months after the inaugural Indigenous Innovation Summit. His conversations with Indigenous entrepreneurs leading up to, during, and after the summit revealed massive barriers in access to capital.

“What didn’t exist was Indigenous investment vehicles. That’s the problem. We said: ‘We need Indigenous equity. I wonder if we can raise capital from the non-Indigenous world to invest in Indigenous enterprise and prove that this can be done.’”

They did! Raven Capital completed their sixth investment in June 2020. All of their ventures so far are promising — and one in particular sparked the development of a new social finance model for community-based solutions.

In a CDOC, the community in question determines its priorities and how they’re going to get there before they look for capital. It places control into the hands of the beneficiaries, rather than external parties that don’t fully understand the problems they’re trying to solve.

The CDOC itself is basically a pay-for-performance model: private investors upfront the investment and tag a rate of return based on success. The Indigenous social enterprise will work with the band to implement the solution. Once they hit success, the outcomes buyer (the government) pays the private investors back with a rate of return. Raven Capital acts as an intermediary between all three parties.

It’s an intentionally slow, deeply collaborative process.

“We will often say ‘we are now going to be in relationship with each other,’” explained Jeff. “At the end of the day, when things get tough you rely on relationships to see you through. So we spend an inordinate amount of time building relationships and trust.”

Using business as a force for good

B Lab Canada’s Country Manager Kasha Huk joined us in July to talk about using business as a force for good, stakeholder capitalism, and the stringent requirements businesses need to meet to maintain their B Corp Certification.

We often face silos when trying to address systemic inequities: “Nonprofits and governments are creating these policies on one side to do good, and then businesses are doing the work they want to do and donating money toward causes. But they were kind of seen as separate.”

This is where the B Corp comes into play: “The B Corp movement [is] this place where businesses are seeing that [they] can address complex social and environmental issues through their business model.”

Essentially, these are for-profit organizations that want to use their influence for good.

A B Corp (not to be confused with a Benefit Corporation, which is a legal structure) embraces the idea of stakeholder capitalism. They define what’s in the best interest of a company not solely by profit, but by thinking about different stakeholders.

Currently, there are over 260 Canadian B Corps – a number that has grown exponentially in recent years.

“We work with these companies to help them achieve greater impact through the assessment process,” Kasha explained. It’s a lengthy, stringent evaluation that asks businesses to consider all their stakeholders in their operations, and must be completed once every few years to stay certified.

While the B Corp Certification is available only to for-profits, Kasha encourages all organizations to use the free online assessment as a tool to track their improvements over time across five different areas: governance, workers, communities, environment, and customers.

“[The assessment helps you] understand how you’re doing across these areas, and gives you a road map for improvement.”

Measuring success with community capital

We spoke with Buy Social Canada Managing Director David LePage in August about social procurement and the Marketplace Revolution.

In the early 2000s, David realized that while there were lots of employment social enterprises doing great work, there was a stark lack of demand for social enterprises and the people they hire.

“The companies that were saying ‘we want to help’ were [also] like ‘we don’t hire these people,’” David recalled. “But they buy the products and services that hire people into entry-level jobs. So how do we […] create the demand side that says ‘I’m going to buy from the companies that will hire these people’?”

This is the foundation of social procurement theory, which proposes that the purpose of a marketplace is not to create economic value, but to create healthy communities. This means taking into account human, social, physical, and cultural capital along with economic capital – something Buy Social Canada calls “community capital.”

“When we start to measure success in community capital, we start to change the very activity of business,” said David. “So if you aren’t paying a living wage and beyond, if you aren’t environmentally sound, then you aren’t fulfilling your capitals.”

Social procurement is about looking past financial reward as a sole measure of success, and making intentional purchasing decisions that have a positive impact across all capitals.

Government support is imperative to driving this change in how we do business, and can support social enterprise through its procurement decisions.

“The whole policy system is set up to reward big business and financial gain. We need to make accessible the same supports for social enterprises that are available to private businesses,” said David. “We have to shift how we value. It’s not the lowest price, it’s the best value. And the best value is about community capital.”

Rethinking food waste

Marcos Igreja, Genecis’ Associate Director of Engineering and Operations, joined us in October to speak about the circular economy, turning food waste into biodegradable plastic, and the environmental and human costs of the products we use every day.

Genecis takes local food waste and turns it into PHA, a biodegradable plastic whose properties are almost indistinguishable from the traditional PET plastics many manufacturers currently use. It’s an excellent example of a business contributing to a circular economy.

“The circular economy is an economy that knows how to take into account the entire life cycle of any good that is produced,” Marcos explained. “You need to be able to understand everything that came before it – all the labour, all the resources – and what happens after… how it is disposed, where it ends up. Most importantly, you have to be able to connect the two ends back together.”

The startup has already seen interest from clients across multiple industries, from medical equipment (e.g. biodegradable sutures) to household food producers (e.g. packaging). It’s hard not to get excited about their PHA: it’s sustainable, locally-sourced, and most importantly, it minimizes externalized costs.

“When people say that petroleum is cheaper than biofuel or bioplastic, they’re not taking into account costs caused by disposal, the pollution this causes in oceans, greenhouse gas emissions which affect our atmosphere, and all sorts of other political conflicts created through the improper use of those resources,” said Marcos. “In a fair economy, you have to take into account those costs.”

Democratizing control of community resources

In December, SolarShare General Manager Chris Caners sat down for a conversation about democratic control, community-financed projects, and the importance of government support for systems change.

SolarShare is a nonprofit cooperative that owns, finances, and operates 49 solar facilities across Ontario. They’ve raised over $60M with their community financing model, and their values are rooted in giving communities ownership, access, and control over local infrastructure (specifically, a renewable energy source).

“Fundamentally, the thing I’m excited about is the participation and role of community in our day-to-day lives, and in SolarShare’s case, the infrastructure,” said Chris. “The co-op model is a great model. It speaks to me about democratic control.”

It’s a lot harder for a solution’s beneficiaries to get taken advantage of when they are also its owners and key decision-makers.

“It gets a lot better when we have resilience within the community, and are able to [supplement] it with external sources,” said Chris. “For me, democratic control of infrastructure is one path to a better, more equitable future for all of us.”

Chris acknowledged the challenges of scaling community-based solutions right now. We designed a system that rewards only a small group of people. So of course the people who benefit from this system – the ones who currently hold power – aren’t eager to disrupt the status quo.

“Fundamentally, we need to change the way we operate. If we want a better and more equitable future, we need to design it into how our organizations and our laws work,” he said. “There are lots of people doing lots of excellent work, like SolarShare, TREC, and CSI. But in order to make it scale, we need our governments to help.”

What’s Next

We’ve seen some common themes run across our conversations with these leaders: the need to think holistically about how businesses operate and who they impact, the importance of strengthening communities through democratic control, and the need for government policies that support the organizations creating change.

We’re excited to continue these conversations, and we hope you’ll join us on this journey! Our first Next Economy Conversations of 2021 will be with Paul Taylor, Executive Director of FoodShare Toronto, on February 4. Get your tickets!

Further Reading

Still hungry for more? Here are a few full-length recaps from the other conversations we had last year:

Visual learners, we’ve got you too. Watch all the recordings from Next Economy Conversations and Climate Ventures Conversations on YouTube.

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