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On how complex systems and how dark money is moving into the light and investing in our patch

complex systems

NEWS FROM THE FRONT DESK: ISSUE 406 – Peter Head is urbane, quietly spoken, friendly. He’s also extremely well tapped in to the global trends that are about to reshape our world.

Meeting him and fellow team member Stephen Passmore at Reslience Brokers, the gig that’s been seven years in the making, was always going to be interesting. It turned out to be inspirational. A fabulous antidote to the daily dross that can dispirit we ordinary folk in sustainability who gaze at Canberra for some sign of leadership. Forget Canberra, look at Switzerland, Holland, the UN, New York and Swansea.

Head lifted our gaze from the daily news loop of political assassinations in Canberra – and the ABC – to look outwards to the big story that would entirely dwarf our sad political shenanigans.

Here was the wishlist we’d heard about for years finally taking form and substance in the real world. Complex systems modelling for planning. Advances in technology and energy that might make the energy positive building in Swansea, Wales, we wrote about in June scale up. Radical thinking about what kind of economic and political systems will save this planet. The huge volumes of money sloshing about looking not just for any home, but a sustainable and ethical home.

Where to start. Slowly and calmly, like Head himself, of course.

Here’s how he explains it in his own words:

The Ecological Sequestration Trust is a new outcome-focused UK charity that aims to prove, through a global network of Regional Demonstrator Projects, a transformative low-carbon, economically attractive and resilient development path to improved water, energy & food security.
The Trust has a unique capability to deploy a “systems approach” of regional investment and community participation to meet the combined challenges of: i) climate change, ii) pollution and cost escalation from consuming finite resources unsustainably and iii) acute societal stresses including poverty and joblessness.

Imagine you want to build a community for 1000 residents. Head’s modelling will tell you, plus the council, the community, state government, potential investors, insurance companies, bankers and local Indigenous people what the impact will be on water, energy, community, economic activity and so on. Anything you can think of it turns out. Including how an Indigenous sensibility can inform the outcomes. Indigenous people have already mapped the interrelationships between land, sky, sea, creatures and, people; why wouldn’t you invite them to the table?

Turns out Head has, as part of the very first workshop in the Hunter Region of NSW to establish a prototype for the system.

All of this is interesting enough and in some ways feels like this might be akin to creating a new life form with all its needs, identified, in a test tube. But with the advent of artificial intelligence and the highly sophisticated technology that comes with it, you also suspect we could be getting pretty close to matching the dream with the reality. Head says, yes, the team will be tapping into AI soon enough.

Even more exciting though is the virtuous circle that this enables.

Head said after seven years he now has a serious investor from Holland ready to underpin the venture. Their identity is still under wraps but not the motivation. Asked what’s in it for the investor and Head replies that it’s impact investment.

We know that’s a force to be reckoned with. Impact investing is one of the fastest growing sectors observed in recent history.

As Forbes tells us, “A recent Global Impact Investing Network survey, investors committed more than $US35 billion to impact investment deals in 2017, a 58 per cent increase on the previous year; while total impact assets of its respondents were $US228 billion, double the 2016 total.

Even more amazing is the dark money that’s coming into the light.

According to Head, the Swiss have a video that shows enormous amounts of money that resides globally in the dark underground world of crime – drugs, prostitution, human trafficking and so on –  moving at increasingly rapid rates into the light, the world the rest of us live in.

Why? Because there’s more money to be made legally it turns out.

All of this money then becomes immediately available to the world of regular investment where, as we’ve said, the move is towards impact investment.

Amazing is just one word to describe the potential this gives to the job of saving the planet, when even the hoodlums and evil czars of the world realise that crime doesn’t pay so much after all and that it’s better to be invested in ecologically and socially sustainable programs.

The investor attraction works like this: In the Greater Accra region in Ghana where Resilience Brokers will be running another prototype for the Ecological Sequestration Trust, local government is currently messy and uncoordinated and consequently there is little decent infrastructure such as for water and sewerage.

The expectation is that by co-ordinated planning the region can become a place where key elements of a stable society are knowable, quantifiable and predictable. This means safe and healthy places for humans which then translate to safe and healthy places for business to invest, banking and even insurers to dip their toes and amp up the activity.

It becomes a destination for impact investment with huge upside.

There is no shortage of money on the planet, says Head. We agree. So many times we’ve pointed to the GFC and the squillions lost: there was pain, among the lowest paid and most vulnerable of course, as always, but the world didn’t collapse. In just 10 years the globe is again awash with capital trying to figure out where to earn bigger dollars (and how to avoid the next GFC).

What better place to look for the biggest returns than the places that have the most to gain  – degraded areas that are desperate for improvement such as Accra and places that offer a big population growth play because they are so attractive, like the Hunter region of NSW. Two ends of the spectrum, both rewarding to the planet, to its people and to its investors.

Win-win. Cake. Eat. Keep.

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