Day 4 ⏐ Session 1

Written By the System Innovation Initiative

Coalitions of Capital:
convening system shifting investors 

The gravitational pull of finance and capital holds immense power, often dictating the terms and calling the shots. This dialogue kickstarted our day on the role of investment in shifting systems. We were joined by leading Australian colleagues - thinkers, practitioners and funders doing pioneering work, in a conversation hosted by Charlie Leadbeater and Carolyn Curtis of The Australian Centre for Social Innovation, with: Ingrid Burkett, The Yunus Centre at Griffiths University (AU); Sabina Curatolo, Bridges Australia; Simon Baldwin, SecondMuse (SG) and Ben Gales, The Paul Ramsay Foundation (AU)

“We knock up against, and work with communities that knock up against this power every single day. And so I think in these conversations, it’s really easy to rest on the technical side of investment and layering and stacking and folding and all the other fancy things. But actually, this is a profound adaptive challenge, where we are fundamentally talking about identity and what constitutes power and the relationship with money”
— Carolyn Curtis

Resources

Pictures from Session

Quotes from the session

  • “At the moment we've got ‘system now’ and what you see in ‘system now’, in finance is a whole welter of different things that you often see when systems are in trouble and they're losing their coherence.” (Charlie Leadbeater)

  • “You find people who are trying to escape… the grip of this system which is failing, and they're trying to imagine a different system. So what is that flip from ‘system now’ to ‘system next’? Well, this system fundamentally is designed around capital calling the shots. It's really about money determining what happens, its capital in command. And so the opposite of that, if you wanted to really flip it, would be capital as servant…” (Charlie Leadbeater)

  • “...maybe if we could form more egalitarian relationships, more open, more democratic, more inclusive relationships around the purposes we want, that could create a power that would then determine resources, resources would follow from relationships, purpose and power, not determine it.” (Charlie Leadbeater)

  • “Frank Geels’ account is that resource systems are often held together by what he calls a cartel of fear. And that cartel of fear is, people know that there's a different way of working, they know there's a different way of moving things, but they're all held together because no one is prepared to step out of line” (Charlie Leadbeater)

  • “The reality is health inequities are not going to be solved deal by deal project by project we need to think systemically.” (Ingrid Burkett)

  • “At a very foundational level we need to start challenging investment norms. Because investment, maybe more vigorously than any other kind of sector, is based on mindsets that say this is the way that investment works. Then cascading into that is a whole lot of regulatory structure that says you have to be of a certain type, or you have to have certain characteristics in order to be investors. We call them sophisticated investors.” (Ingrid Burkett)

  • “Even right down to the intermediaries that we trust with our money, there's a need to change the mechanisms that those intermediaries have at their disposal… (Ingrid Burkett)

  • “The fact is that most people who require affordable housing are also suffering from energy poverty. So unless we invest in something that's actually going to create flows of value into reducing costs of energy, then we're not going to actually achieve the impact.“ (Ingrid Burkett)

  • “We see ourselves as supporting the changemakers….We support the ecosystem. We try to balance power so that voices are elevated. In particular young people, beneficiaries, community led initiatives” (Ben Gales)

  • “You do get quite shackled by time horizons that are linked to electoral cycles, linked to discount rates that are unfeasible which drives you to a very short term perspective.” (Ben Gales)

  • “You can nudge an awful lot with a small amount of philanthropic dollars.” (Ben Gales)

  • “We need all of the players, recognising that each of the different types of capital has a different role to play. And it's a pity to use capital… in ways that it's not leveraging or being used to it’s best ability.” (Sabina Curatolo)

  • “I don't think that investing or impact investing, which I work in, is a silver bullet. I do think that there are areas where the market should not go and that there are areas where only government and philanthropy can can actually address certain problems”  (Sabina Curatolo)

  • “...by all means, please invest in women led enterprises, but also please look at your own internal processes and the way in which you're making those investments…” (Sabina Curatolo)

  • “Power isn't just about what they're investing into, but how they're investing” (Sabina Curatolo)

  • “It's very, very difficult for organisations that are convening and doing the systems work to find a way of capturing value. And I think that's where venture capital is privileged. They have such a clear linear way of being able to capture value by having bets, making big exits, capturing value for themselves.” (Simon Baldwin)

  • “What we have done as an organisation is moved into other parts of the ecosystem and started to think about how we can, for want of a better way, talk about controlling more of those resources that are flowing through those systems in ways that are much more conducive to being able to capture value” (Simon Baldwin)

  • “Some forms of capital privileges selfish capture, but we can redesign these forms of capturing these forms of value capture in ways that thinks about redistribution” (Simon Baldwin)

  • “How do we create financial tools that capture value that share the value back to all of those actors within the system in fair and equitable ways.” (Simon Baldwin)

  • “If you're investing in a particular food, in a part of the food market, you need to consider the whole and who the other players are and actually what the impact is more broadly.” (Sabina Curatolo)

  • “People are finally realising we've structured whole economies in places around people doing bad and people doing poorly. And so we've got this wave of young people coming through with this utter kind of crisis of identity… what we're actually talking about when it comes to some of our most profound social issues in our society is much less technical and far more adaptive cultural identity.” (Carolyn Curtis)

  • “I think one of the most interesting reframes that's happening currently is the crowd equity investment… if you look at the big investors they’re not necessarily women. Impact investment is much more dominantly women, crowd equity investment is growing the women's perspective on investment.” (Ingrid Burkett)

  • “If you look at the big investors, they are not necessarily women and impact investment is much more dominantly women but crowd equity investment is growing the women's perspective on investment” (Ingrid Burkett)

the System Innovation Initiative
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