Green Recovery Insights: Redesigning our economy
5th October 2020
In the second of our Green Recovery Insights blog series, Amy Robinson, Corporate Projects Manager at Triodos Bank UK, explores how we can rebuild a more resilient economy that is better for our environment, health and wellbeing. Triodos Bank UK is one of the Partnership’s founding supporting members.
2020 was set to be a year of transformation. With COP26, the major climate change conference due to take place in Glasgow in November, the UK was positioned to take the lead in demonstrating the change we need to see to face our environmental challenges. Covid has undoubtedly cast a new light over our situation but the climate change and biodiversity crises are no less acute.
Much of the current rhetoric focuses on the importance of economic recovery, and while we undoubtedly need to support businesses, protect jobs and ensure that this crisis doesn’t create irreversible damage to our economy, we must take this opportunity to create a new, better ‘normal’.
We need to redefine what matters most. There is a growing acceptance that GDP is not an adequate way of judging our success. We must measure our entire economy in ways that account for biodiversity, equality and human dignity. We must move to a more values-based economy that reflects the true cost of production and the environmental and social impacts of our actions and investment decisions.
To do this we must redesign our economic systems, creating a wellbeing and values-based economy that invests in local communities, not just international corporations, and natural infrastructure, not just roads. In this redesign we have the opportunity to develop the next generation of environmental solutions, as well as the innovative financial models needed to support them. At Triodos Bank we really understand this need to reset the economy.
What does this mean for Bristol and our economy?
Valuing nature and ecosystems services
Lockdown has given many of us a newfound appreciation for nature and green spaces, their value to wildlife, wellbeing, air quality and community is enormous. However, we need to ensure that these spaces are accessible to everyone, and that our local natural capital is protected from the budget challenges that the city will continue to face. One solution is to establish the real value of our ecosystem services, and develop ways to finance them. This is not about profiting from nature, it is profiting for nature.
Triodos has been involved in developing a pioneering pilot scheme to encourage sustainable private sector investment in our natural environment. The scheme aims to offer learnings to help secure and replicate the investment needed to help our natural environment recover at scale, and address the environmental crises we face.
The approach could also be used to facilitate new development and transition finance for businesses and households, including for retrofit, and to create sustainable models to maintain libraries and other social hubs essential to community cohesion.
The local authority has a pivotal role to play. In addition to projects like these and City Leap, exploring energy and infrastructure investment opportunities, there is potential to act as borrower, grant funder, catalyst, guarantor and convenor, demonstrating new ways for local authorities to fund this transformation from a transaction-based, to use-based, economy.
Supporting our business community
Throughout this crisis we have seen businesses (notably our incredible independent food and drink sector) diversifying and finding new opportunities. But these changes have taken place in a time of acute stress that none of us want to see again. We must now consider how to help these businesses and the hundreds more like them across the city become more resilient. Spending money in local and independent shops is one of the most straightforward ways to support your local economy. However, we can do more, for example by supporting businesses that are crowdfunding to expand or with an employee ownership scheme.
Investment and Innovation
As individuals and businesses, we all have a responsibility to know how our money is used. All investments have impact and we should consider whether our resources, from our personal investments, if we are fortunate enough to have them, to our pension funds, are being used to grow the green economy. This is also a pragmatic approach: ESG (Environmental Social Governance) investments are reported to have outperformed the market as a whole since Covid.
This is another area where Bristol can play its part. In the next two decades, $68 trillion of global investment is predicted to transfer from US baby boomers to millennials, and around 9 out of 10 millennials want their investments to be ethical. This will see an incredible shift in focus. In addition to redesigning our investment infrastructure (with the development of green bonds for example), we need to build the next generation of green businesses to invest in, those creating the innovative products and services providing the solutions.
The success of the Bristol Green Capital Partnership is a great testament to the city’s commitment to the environmental agenda, and our extraordinary history of collaboration and innovation makes us perfectly suited to build the green businesses of our future. As a city we must work together, not only to create a better Bristol, but to share our expertise at a national and international level.
About the Author and Further Reading
Amy Robinson is Corporate Projects Manager at Triodos Bank UK, working on their Change Finance agenda. She has lived in Bristol for over 20 years and has worked in various roles in the environmental sector for the past 15.
Triodos Bank UK, a leading sustainable bank and certified B Corp, is headquartered in Bristol and is one of the Partnership’s founding supporting members. Its aim is to use sustainable finance to enable individuals and organisations to use their money in ways that benefit people and the environment.
To find out more about Triodos Bank UK visit www.triodos.co.uk, sign up for the monthly newsletter or follow on social media @triodosbankUK
Read about Triodos Bank’s vision for a reset of the economy here: https://www.triodos.co.uk/reset-economy
Read about Triodos Bank’s work with nature-based investing here: https://www.triodos.co.uk/articles/2020/making-the-case-for-investing-in-our-shared-natural-environment