How can we finance a just and equitable transition in Sheffield?

A group of people and organisations have come together to start looking at how we can finance a 'just and equitable transition' in Sheffield – and what kind of economy the city needs to meet the level of urban transformation that is required of us.

A first meeting of interested parties was brought together last month as part of Sheffield Demonstrators, an ambitious collaboration between Opus (who publish Now Then), Dark Matter Labs and Citizen Network which aims to 'demonstrate' emerging futures for regenerative transitions in Sheffield and the wider region. This collaboration is looking at different ways of working, organising and being together which act as 'proofs of possibility' for our future – and what new conditions and capabilities we need to develop as a city.

The Demonstrators work is built around the need for many transitions – for example, a transition to a post-carbon society, but also transitions in how people take part in decisionmaking, how we look radically differently at the natural world, and how we put wellbeing at the centre of human systems.

The group is exploring how large-scale investment into green infrastructure in Sheffield could be done in a way which doesn’t reproduce the harms of the current economic system. The approach questions how we value and price both tangible and intangible assets in our city.

For example, trees are known to benefit urban environments in a number of ways, such as cleaner air, greater wellbeing, mitigation of flooding and countering the fatal effects of urban heat islands. Despite this, trees are counted as liabilities on the city's 'balance sheet' because of the cost of maintaining them. Most of us recognise the value of urban trees, so this is a direct result of poor pricing of those benefits by the economic system – and all of these benefits will become increasingly vital as our damage to the climate worsens.

A less tangible but no less important example is the thousands of people in Sheffield, including children, who care for someone on a voluntary basis. Our city would collapse without this valuable work, but as far as the economy is concerned it's invisible and uncounted. At the same time many of the harms caused by our economic system also often go unmeasured – so the positives are taken for granted and the damage is ignored or externalised.

The group, which was initiated by Dark Matter Labs and has a second meeting scheduled next month, is looking at how an open alliance of investors can be brought together in a democratic and decentralised way. They want to explore how a market can be created for future goods and services which support the city’s transition, and how innovation can be incentivised while prioritising care, justice, ecological balance and a more inclusive economy.

This thinking aligns closely with the Sheffield City Goals and the possible next steps in that work, which look at the infrastructure that is required over the next ten years to achieve the goals, including a proposed 'Demonstrator & Investment Fund'.

It’s also an approach which recognises that an economy structured around constant growth cannot carry us any further. Despite still being held up as the international gold standard, year-on-year increases in GDP – which should not be used as a metric according to its creator – rely on the production of ‘stuff’. If we're serious about transitioning to a post-carbon society, we have to radically adjust our relationship with stuff. An economy that is not grounded in our material realities will not serve us – so it has to be challenged.

And our material realities are genuinely shocking. Recent drastic rises in food and energy prices caused by Russia’s invasion of Ukraine, for example – still being felt more than two years on – are likely to be dwarfed by the impact of rising global temperatures, continued soil degradation and an energy system which will still rely heavily on fossil fuels in the coming decades.

Without proactively working to build alternatives, this kind of severe volatility is likely to completely undermine our economy – locally, nationally and internationally – because so many of our metrics do not measure the harms they are inflicting somewhere else. Because this volatility will make things less predictable, it will cause insurance companies to withdraw from offering cover – as they are already doing in other parts of the world – which in turn could undermine capital markets, which are mostly based around land and property.

These are the problems that the post-carbon finance group are working on. If you have knowledge or experience in finance and investment, particularly with a focus on innovation, and would like to be involved, get in touch. The group is bringing together a 'white paper' as a foundation for its collaboration over the next few weeks.