The mayor of one of the UK’s most dynamic cities has launched a campaign for local businesses to help fund his innovative approach to tackling deep pockets of poverty and promoting an environmental agenda.
In an attempt to encourage private sector contributions, Bristol city council invested the first £5m into CityFunds, the initiative set up by mayor Marvin Rees.
The venture, the first of its kind in the UK, seeks to bring together the private and public sectors and community organisations to advance the mayor’s 2050 vision of a “fair, healthy and sustainable city”, including one that is “carbon neutral and zero-waste”.
CityFunds invites local companies to invest in any one of the city’s four socio-economic priorities, from a greening of energy and transport to equal access to education and economic opportunity. It promises a 4 per cent return to investors.
Andy Street, chair of CityFunds, said the returns would be generated through investing in businesses such as renewable energy schemes owned by neighbourhood trusts based in deprived communities.
“This will create positive social and environmental outcomes that reduce inequality but it also will generate a marginal profit for the fund and, hence, our investors,” he said.
One CityFunds anti-poverty priority is ending child hunger and obesity, which together affect 25,000 children in the city of just under half a million people, according to Sue Turner, chief executive of Quartet, a charity that is among the scheme’s founders. Ms Turner said one project over the summer holiday had taught schoolchildren and their parents how to cook healthy meals.
CityFunds has drawn inspiration from similar schemes in the US, including the Boston Impact Initiative, which invests in people it regards as having been “abandoned by our current economic system”. Big Society Capital, a London-based impact investor that also invested £5m in CityFunds, said it saw Bristol as a test bed for “city-based” investing in the UK.
The south-western city’s economy is mixed. Its “gross value added”, which measures the value of the goods and services produced minus the inputs, is 18 per cent above the national average for local authorities, according to official data. But the gross domestic household income per capita for the city’s residents is 9 per cent below the UK average.
And although official data suggest the south-west of England is not among the worst half of UK regions in terms of inequality, poverty is on the rise again for some demographic groups in Bristol, including children.
These contradictions make it one of the worst places to be born black and poor, according to Mr Rees, the son of a white single mother and black Jamaican father.
“We have growing inequality and people have lost faith in public organisations, not just government, but media and academia,” said the mayor. “My family grew up on the underbelly of this country. People are not in a position to benefit from the way globalisation has happened.”
Mr Rees, commonly referred to by locals as Marvin, said his initial pitch was for local employers to hand over 25 per cent of their corporate social responsibility budget. “We did not get 25 per cent but we got them buying into the principle,” he said, adding that he had not set a fundraising target for CityFunds.
Gareth Williams, chief executive and founder of YellowDog, a computing platform start-up, who had not heard of CityFunds until he joined the mayor on a recent trade mission to the US, said he would be looking at participating in this type of initiative in the future. “It’s important for companies to contribute to the community in which they operate in a meaningful and positive way,” he said.
Mr Williams has yet to invest but his attitude suggests the mayor’s message is resonating in parts of a business community facing a growing interest among younger people in employers that demonstrate a purpose beyond profit.
“If we want economic growth to be sustainable, we have to engage with a diverse community and ensure we have a diverse workforce, and that starts with primary school,” said Nick Sturge, founder of the Engine Shed, an incubator for tech start-ups in the city centre. “How do we make the exciting stuff in the city work for the whole population?”
Not all entrepreneurs are convinced about CityFunds and the thinking behind it, however. “Bristol has lots of businesspeople who want to help the region,” said Heather Macdonald Tait, who runs Why, a local communications business. But the first “job of people like Marvin should be to remove barriers [to business]” in order to help local companies generate jobs and wealth, she added.
