Introducing MIST, a new paradigm for systemic investment towards a regenerative Melbourne
Melbourne Invests in Systemic Transformation (MIST), is a new collaboration between local and global capital holders, fund managers and thought leaders. Convened by Regen Melbourne, the initiative seeks to achieve a paradigm shift in the impact and approach to deploying purpose-led capital across Greater Melbourne.
There is now consensus amongst scientists and economic leaders that urgent change is required to safeguard our planet for human civilisation. From the sustainable development goals, to the planetary boundaries framework and the COP process, there is global agreement for change. However, progress towards meaningful change at the magnitude required is limited, with emissions rising, natural disasters increasing and inequality accelerating. Social and economic change that rises to the scale of our current challenges is elusive in the context of systemic inertia and the forces of status quo economics.
The United Nations identifies finance as a critical success factor for the fulfilment of the Sustainable Development Goals. Similarly, the Paris Agreement names finance as one of three essential strategies for reaching our climate goals. It is agreed that capital is a critical lever in driving positive change and addressing our global challenges. In response to this context there have been countless “sustainable finance” and impact investing initiatives in Australia and around the world. In fact, most people reading this will have been part of these initiatives. It is clear that our challenge is not a desire for change.
Instead, the problem is there is a mismatch between:
(a) acknowledging the urgent need to deploy finance in service of transformation and
(b) the amount and quality of money flowing towards genuinely systemic action.
our current financial paradigm is blind to the quality and magnitude of risks we face, and is equally blind to the transformational opportunity that lies in structuring system-level value. Money is not flowing in service to life.
Wide-sweeping systems change is essential to address challenges such as climate change and urban amenity. However, our financial and investment systems (even those with a sustainable or impact focus) are geared to simple linear relationships between investments and outcomes, costs and benefits. Hence capital deployment is often limited to treating symptoms rather than solving for deep-rooted causes. As our partners at TransCap Initiative note, “the paradigms, structures, and practices of today’s financial sector prevent it from unleashing deep, structural change in the real economy.”
As such, the focus on simply increasing the quantity of capital into the “impact space” is only one half of the challenge. The other half is interrogating the quality of capital and shifting the finance paradigm and investment logic away from incrementalism and single-point solutions and towards systemic transformation.
Ultimately, our current financial paradigm is blind to the quality and magnitude of risks we face, and is equally blind to the transformational opportunity that lies in structuring system-level value. Money is not flowing in service to life.
We need new approaches.
As a result of Regen Melbourne’s foundation research into this issue, a formal collaboration has emerged that we are calling Melbourne Invests for Systemic Transformation, or MIST for short. This is a collaboration dedicated to nurturing a paradigm shift in purpose-led capital and actively prototyping investment vehicles at the intersection of systems thinking and finance.
Convened by Regen Melbourne, MIST includes local capital holders and fund managers, alongside national thought leaders including Small Giants, Climate-KIC and Centre for Systems Innovation, and international systems partners like Dark Matter Labs and TransCap Initiative.
Download the full MIST report below for more information.
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