Canada’s community sector has a big role to play in climate change solutions

Stephen Huddard
WHAT Media

Last month, the Intergovernmental Panel on Climate Change (IPCC) released its latest report warning that the window to prevent climate chaos is closing fast. It defines climate change as a global challenge requiring regional solutions.

Importantly, the report asserts that climate change is as much a social issue as it is a scientific one, concluding that ‘climate resilient development’ must focus on decarbonization, adaptation, biodiversity conservation and equity. social.

So what is Canada doing to create these regional solutions? Our community sector has a big role to play.

The sector’s 170,000 charities and nonprofits include hospitals, universities, philanthropic foundations, chambers of commerce, trade associations, cultural organizations, cooperatives and social enterprises. With 2.5 million employees and nearly $170 billion in annual revenue, it is an under-recognized source of innovation, social capital, shared values ​​and community well-being.

Canada’s community sector can help shape a “transitional economy” by funding organizations that deliver social and environmental outcomes in addition to profits, participating in rapid tests to generate evidence-based policy innovations, and supporting comprehensive community transition initiatives.

The federal government will soon name the organizations that will act as intermediaries for Canada’s Social Finance Fund (FSF) – a $755 million fund to grow capital in the social sector – based on the British model to success, Big Society Capital. By using the SFF as a matching fund, intermediaries will attract new capital to make loans and invest in social purpose organizations.

Quebec’s social economy shows what such a transitional economy could look like. In a province with a GDP of $365 billion, 11,200 social economy organizations generate revenues of $48 billion. They work in fields ranging from arts and agriculture to retail, restaurants, manufacturing and IT, prioritizing the common good over private profit.

The question is also how social and economic systems can be adapted or replaced to produce better outcomes for people and the planet.

In their 2019 book Good Economics for Hard Times, Nobel Prize-winning economists Abhijit Banerjee and Esther Duflo argue for policy innovation informed by experiments that test solutions to real problems. It’s a principle that underpins Social Impact Bonds (OIS), where private investments allow community coalitions to test new approaches to complex challenges, with governments, foundations or corporations repaying investors based on results. When SIBs set goals but not specific steps to achieve them, they can be a useful form of research and social development.

The Deshkan Ziibi Conservation Impact Bond is a good example of an SIB focused on climate-resilient development. This groundbreaking initiative works on protecting biodiversity and investing in a reconciliation economy across much of southwestern Ontario. Partners include the Carolinian Canada Coalition, Chippewas of the Thames First Nation, Thames Talbot Land Trust, VERGE Capital and Ivey Business School. 3M Corporation serves as the end purchaser.

Social impact bonds have also been used to improve high school completion rates; reduce the number of Aboriginal children placed in foster care; and stem the spread of chronic diseases. Fears that SIBs would lead to the privatization of public services have not materialized.

With their ability to grant and invest for modest returns, philanthropic foundations are well placed to support SIBs in collaboration with governments and community partners.

At the MaRS Center for Impact Investing – a Canadian developer of social impact bonds – Jason Sukhram, Director of Impact Measurement and Management, says: “SIBs remain an underutilized tool for innovation in the public sector. They can also empower social purpose organizations to measurably improve results in areas where there is room and urgency for progress.

Finally, comprehensive and consultative collaboration among community stakeholders can serve as both a test bed and a foundation for an economy in transition. This is the premise behind initiatives such as Second Muse’s Future Economy Labs, Low Carbon Cities Canada, Future Cities Canada, and the Tamarack Institute’s Community Climate Transitions program.

Tamarack Program Director Laura Schnurr recently wrote, “With jurisdiction over buildings, transportation, waste and land use planning, municipalities influence approximately 50% of Canada’s emissions. They are more nimble and closer to the ground than higher levels of government, allowing them to act quickly in a crisis and engage directly with residents. They are also natural environments to pilot innovative climate solutions that can be scaled up elsewhere.

To meet Canada’s international climate commitments, we need regional solutions. Canada’s community sector can help us get there.

Stephen Huddart is a founding member of the Transition Innovation Group hosted by Community Foundations of Canada. He lives in Montreal.