As our news feeds are filled with the worst of nationalist and protectionist rhetoric, I’m inspired by the positive stories that highlight the ways communities are working to foster equity, social inclusion and economic resilience.
What does it mean to “think global and act local” in your business operations?
Whether it’s the co-operative movement, new ways of thinking about community investment, or tales of social hiring and partnership, the stories emerging from the localism movement show us that acting locally is a viable and effective path to a healthy global society. Where the protectionist movement is rooted in fear of lost opportunity, the localist movement is rooted in opportunity creation and community building.
Protectionism fears lost opportunity. Localism creates opportunities and supports communities.
As someone who has spent the last few years of my career immersed in the localism movement, I know localism is really about recognizing our interdependence and cultivating resiliency in the communities where we live and operate our businesses. As consumers, we may be most familiar with local food and small scale manufacturing, but what does the localist movement look like when it applies to business?
Local investment. Local ownership. Local wealth.
Much of the world’s wealth is held by a very small part of the population. A fairer, more equitable distribution can be achieved if business ownership and investment is focused in local communities. Businesses increase employee loyalty and engagement with distributed ownership models including employee share ownership plans (ESOPs) and co-operative business models. These models also help to keep wealth in the communities where it’s created. The movie A New Economy highlights the sheer number of co-operative enterprises that are emerging, and the values that drive them.
Fostering entrepreneurship is a way to expand ownership in local businesses and increase econcomic resilience. In British Columbia, the RADIUS Ventures program at Simon Fraser University launched the First Peoples Enterprise Accelerator Program to support entrepreneurship in Indigenous communities. Funded in part by Canada’s national bank, it creates opportunities for community investment, local relationships and connections, while also helping local ventures to grow and thrive. Local investment models include employee ownership, local financing (often via local credit unions) and locally focused investment funds. Less formal ways to invest include new forms of crowdfunding, such as the interest free loans created by Community Sourced Capital.
The amplifying power of ‘recirculation.’
One of the simplest ways to invest locally is through local purchasing. On average, every dollar spent with a local business in British Columbia recirculates locally about 2.5 times before leaving our communities, compared to a dollar spent with a multinational company. These statistics are consistent in the US and the UK. Local purchasing strengthens local businesses, creating local jobs and supporting local wages. And local businesses give up to five times more to local organizations than multinational firms, meaning that local charities benefit from a healthy local business community as well.
There are many ways to purchase from local businesses even when your inventory may not be inherently local. (Let’s face it, coffee is not a ‘local’ beverage for most of the world). By thinking about where local value is created throughout the value chain (i.e., through local ownership, investment, manufacturing or production), you can increase the community impact of your purchasing policies. For many businesses, local service suppliers can be a good place to start.
Deepening local impact through social hiring.
Social hiring refers to the hiring of employees who have barriers to employment in the traditional economic model. If it’s challenging for your company to hire these employees directly, consider purchasing from the many organizations that do. Near our Vancouver office, Starworks Packaging and Assembly provides third party distribution services to local small and medium sized businesses. Starworks was established by the Developmental Disabilities Association to provide employment to individuals with developmental disabilities. Businesses who outsource to Starworks are able to grow their distribution capacity at their own pace while providing jobs for those with developmental disabilities. In turn, those employees engage and participate in the economic health of their communities.
When my news feed worries me about where things are going on a macro scale, I take comfort in my faith in people to come together and engage in human scale business practices that build relationships and resilience, helping our communities to thrive.
Interested to learn more about the work locals are doing to build thriving communities. Explore these links:
- The Business Alliance for Local Living Economies (BALLE) – Local Economy Framework
- LOCO BC – Power of Purchasing report
- B Corporation movement – discussed in a previous blog post
- Big Society Community Capital
Interested to share models that are working in your community? We’re all ears! Please share your favourite stories by commenting below.
Katja Macura is a Senior Consultant who works from Junxion’s Vancouver office. She is deeply involved with local economics through her service as a Director of LOCO BC. You can reach Katja via [email protected].