Audrey Jamal, PhD, Assistant Dean

Strategic Partnerships + Societal Impact,

Assistant Professor Gordon S. Lang School

of Business + Economics


Presentation to celebrate Small Business

Week @ YWCA Hamilton

Community Wealth Building:

A path toward building more sustainable and equitable economies

Background:

Nonprofit and public

sector leadership

Teaching/Community- Engaged Research

Business Owner Consulting & Research

Community Economies

What is community- based economic development?

  • Creative local problem identification and decision making.
  • Broad community engagement.
  • Focus on quality of life and more sustainable, equitable economies.
  • Challenges traditional approaches to building the economy.
  • Includes business, governments AND communities.

How it is different from

other approaches?

  • Two-player: businesses and governments.
  • Smokestack chasing”.
  • Focus on economic growth.
  • Extractive, profits leave the community.
  • Result: communities vulnerable to closures, plants moving etc.

Why are community economies important now?

“Polycrisis – a cluster of related global risks with compounding effects, such that the overall impact exceeds the sum of each part” (World Economic Forum, 2022).


  • Economic recovery (post-pandemic)
  • Inflation and food costs
  • Housing affordability and availability
  • Systemic racism and deep social inequities.
  • Climate crisis.

Global challenges experienced locally…

If challenges are experienced in local communities; solutions are also emerging in communities:


A community or city is more nimble, accessible and open to experimentation.

“Power belongs to the

problem solvers”

(Katz & Nowak, 2017).

Emerging Trends + Innovation

Small Businesses in Canada


  • 1.19 million small businesses in Canada (2021).


  • As of 2021, small businesses employed 8.2 million individuals in Canada, or 67.7% of the total private labour force.


  • In 2019, small businesses contributed 36.7% to gross domestic product (GDP) generated by the private sector


  • 17% of SMEs are owned by women.


  • Only 4% of Venture Capital funding is received by women in Canada.


https://ised-isde.canada.ca/site/sme-research-statistics/en/key-small-businessstatistics/key-small-business-statistics-2022#sC


https://www150.statcan.gc.ca/n1/pub/11-621-m/11-621-m2023003-eng.htm


https://wekh.ca/data/

Business School Trends

Increased focus on sustainable business and responsible management.


A growing number of students launching their own ventures from university.


A growing interest in alternative business models: B-Corps, Social Enterprises, Nonprofits.


Innovation moving from a linear to a more circular economy.


Start up funding, social impact investment.

Greater Diversity in Business Ownership

  • Black and Indigenous-owned businesses.
  • Newcomer entrepreneurship.
  • Women entrepreneurs.
  • Youth starting businesses.
Plus Icon Addition Sign Criss-Cross Button

Increased supports for launching local ventures

  • Community kitchens
  • Mentorship programs
  • Networking events
  • Often led by nonprofits

(PowerUp in Hamilton)


‘Alternative’ Business

Models

  • B-Corporations

- Fast growing movement

  • Social Enterprises

- Profit + A Social Purpose

  • Circular Businesses

- A move from linear to more

regenerative

  • Sustainable, responsible and ESG aligned.

Community Benefits

Agreements + Social

Procurement

Linking private investment with social impact:

  • Workforce development
  • Social Enterprise and local business
  • Community investments


Examples:

  • London Children’s Museum
  • Eglinton Cross Town LRT (Toronto)
  • Gordie Howe Bridge (Windsor-Detroit)

New

Governance

Structures

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  • Community led
  • Community Foundation,

Community Futures,

Municipality

  • Economic mapping
  • Experimentation and Education

Economic

Nutrition

Labelling

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  • Consumers want to make informed decisions.
  • What if everything you bought told you where exactly your money was going?
  • The information provided by our ECONOMIC NUTRITION label shows how your purchase impacts the local and global economy by detailing how the money you spend is distributed.

CM

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Communities around the world are beginning to harness these trends to build a new kind of economy.


Community economies are more democratic, equitable and sustainable.

Community Wealth Building


  • Concerned with how to generate and retain wealth locally.
  • Non-extractive, keeps wealth ‘sticky’.
  • Democratic and local ownership and control over businesses and assets.
  • Requires coordination with local governments, economic development teams, anchor institutions, community organizations and business.

Community Wealth Building is an emergent model (2005) of economic development:


  • CWB seeks to transform local economies based on communities having direct ownership and control of their assets.
  • Takes “one-offs” initiatives and connects and scales them.
  • A system-changing approach to local economic development that works to produce broadly shared economic prosperity.


--The Democracy Collaborative

Five Pillar Approach – Democracy Collaborative

Inclusive and democratic ownership

  • Cooperatives, Social Enterprises
  • Employee ownership trusts
  • Social finance funds
  • Fair work/living wage

(Community Benefits Agreements)

  • Land trusts
  • Social/local procurement with anchor institutions (e.g., hospitals and universities)

Locally rooted finance

Fair work

Just use of land and property

Progressive procurement

CWB Activities in Mid-Sized Cities

  • Community Bond Investments
  • Social Finance Funds (e.g., Harvest Impact)
  • Activating Local Assets e.g., Guelph Junction Railway, Farmer’s Market
  • Circular economy/businesses
  • Community benefits agreements
  • Land Trusts
  • Social Procurement

What’s happening in Hamilton?

  • Hamilton Economic Development Action Plan

- Attraction, retention and growth of businesses

- Newcomer workforce engagement

  • Hamilton Community Benefits Network

- Advocating for workforce development, local businesses in LRT project?

  • Hamilton Community Foundation

- Impact investing

  • Hamilton Transit Oriented Affordable Housing Lab

- Federal support for affordable housing projects linked to transit development

What does this all mean?

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Small and locally owned businesses are drivers of community wealth creation and retention.


Innovation in procurement policies can create a demand for local businesses, social enterprises, and businesses owned by diverse communities.


Community Benefits Agreements can be a catalyst for engagement and labour market development.


CWB practices are beginning to gain traction, but they are not yet entrenched in policy in Ontario or Canada.


Need to raise awareness of the model. Map, connect and scale to bring about change.

What can small businesses and entrepreneurs do?

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  • Examine at your business model.
  • Talk about how you’re contributing to local workforce development.
  • Access social financing funds e.g., Harvest Impact Fund.
  • Create purchasing clusters or cooperatives to support other local businesses.
  • Collaborate with business associations, nonprofits to advocate for community wealth building in your city.