The Hopeful Cynic: A Journey through Social Enterprise and Finance with Dr Belinda Bell
In this episode of “Be and Think in the House of Trust”, I am listening to Dr Belinda Bell, a social finance specialist turned social entrepreneur, and academic, who has dedicated her career to social change.
She began working with community finance organisations to provide capital for entrepreneurs creating a positive impact.
Over time, after setting up a few ventures herself, and teaching about the ecosystem at the University of Cambridge, she realised that social enterprises alone were not enough to quickly solve systemic issues like climate change and inequality.
She is now collaborating with “universal owners” – large institutional investors like pension funds that own vast portions of the economy and have an incentive to address risks that could damage their portfolios.
Bell works to help these universal owners understand how maximising short-term profits can create long-term damage;
Navigating through the tough paradox of hope and cynicism, her challenge is to encourage large investors to use their influence to drive companies at large toward more sustainable practices.
Highlights in this episode:
(01:37) Curious, hopeful, cynical, and angry
(10:09) Things that appear radical can very often turn out to be maintaining the status quo
(11:47) Let’s normalise the world we want to see
(18:44) How do you actually get people to do things?
Belinda Bell on LinkedIn: https://www.linkedin.com/in/belinda-bell/
Academic Publications https://www.landecon.cam.ac.uk/person/dr-belinda-bell
Welcome to the House of Trust. My name is Servane and in every episode, my aim is to be a thinking environment with an inspiring leader who loves to invest in social and environmental change.
Together we take the time to be and think. And we talk about the attitude, the thoughts, the feelings that you need to ignite and grow.
A positive social and environmental impact. No, we could influence or direct capital to enable us to do so.
And I invite you to think along. Today, my guest is Belinda Bell, who has had an interesting journey from social enterprise to social finance.
She is the co director of the Finance for System Exchange Center, Department of Land Economy at the University of Cambridge.
She is a fellow in social innovation. At the Cambridge Church Business School. That's a wonderful building actually.
And, is senior research associate at Jesus College in Cambridge. And I'm curious to learn from Belinda about her work with universal owners who will look into that, what it is, what they.
Represent what we can do about that. And I'll look into thoughts about long and short term horizons and what that quest for impact means for her.
Hello, Belinda. How are you today?
Hi, I'm very well. Nice to see you.
So let's start on a high. If you had literally up to 5 words, not 6.
Just 5. Or less than 5 to share both yourself and describe who you are and what you stand for.
What would they be?
So I'm curious. I'm hopeful. And Seneco. And it's just, you know, yeah, I have to be both.
I can't be only one. And, and I'm angry and I get angrier, you know, every year it seems.
Okay, curious, hopeful, cynical and angry. And now, how did all these words?
These words, these these ways for you to be, you know, supported you in your journey from social enterprise to social finance.
Maybe you were not cynical before, were you?
Oh, I think I'd start out pretty cynical. I'm pretty angry as well, you know.
Yeah, you know, as a young person, I suppose I looked at the world around me and it seemed like it wasn't very fair.
And that seemed you know not right and and i you know i suppose one doesn't you know you don't necessarily understand how it is or why it is that the world doesn't.
Fair, but it patently isn't fair and unfortunately as the years have passed the world is still not fair.
And but we have to maintain hope. But we also have to be very distrustful when institutions or organizations or people tell us that they're going to change and they're going to get better and they keep saying this but change doesn't happen.
So. We have to. Be curious and hopeful so we can find new solutions and find new paths, but also acknowledge that for some of us individuals it's really tiring and really hard work and makes you really angry that we're still in this situation.
So, you're starting on a very strong note here because you're suggesting that we hold all these paradoxes at the same time to be able to Stay awake and adjust.
Yeah, and you know, there is, I guess, some people in a tendency to sort of brush onto the carpet how how very grim things are.
And that's understandable, but for those of us that really want to engage with the world, my view is that to change the world you have to like properly engage with it first and and that involves acknowledging and looking at some of the things that are really bad.
And then trying to find ways. To change them and then in my sort of career. As well. Thinking we found ways and then those ways not actually shaping into what we'd hoped so failing.
And and and then trying again because we because we have hope because you know we only have the one life so you know you work on the hope piece.
Yes, short term, isn't it? So. Tell us about your journey from social enterprise to social finance.
You're good. 5 min.
Hmm. Well, I mean, in the sense I started in social finance and ended in there as well and it's sort of annoying because I'm not in the least but interested in money.
And it's just that if we live in a capitalist system, then we, that's where the power is.
So I started working in London years ago in a, community development finance institution lending money to social enterprises.
So there I learned both about the power of capital and access to capital and and also about social enterprises, which was this is right the beginning of the new labor government.
It was kind of a new concept for for an old thing obviously. So, so in due course I went and set up my own community finance organization.
So using that. To support entrepreneurs in general, not just social entrepreneurs, but the organization itself is a social enterprise.
Then off that I said a couple of other social enterprises. Before coming to the University of Cambridge where I set up the programs that teach social entrepreneurs kind of how to do social enterprise.
And as you know, a big part of that world is, about funding. And kind of outsized part of that world is about is about funding and capital and investment.
And it's always disproportionately emphasized. You know, financial capital is only one of the things you need to get a business off the ground, a social business or otherwise, and it's overly emphasized in my view.
So yeah, so that all of that took, I suppose, 20 years. But, at the end of that period, I really came to the view that social enterprise was not able to rapidly enough.
Address the problems that are economy. Is throwing up for us and by that I mean, you know, the challenges the planet faces, you know, climate change, biodiversity loss, whatever, but also systemic risk such as inequality that are fundamentally part of the capitalist system as we're currently doing it.
I came to think the social enterprise was not able to address those challenges in the timeframe that we have available.
And also, and it everybody in social enterprise is lovely, that goes without saying, lovely lovely people, it's hard to leave, but I actually think that on the whole in my own work, I rather see for the people that I may have done more harm than good.
By its existence gives a sort of facelift to mainstream business. And, the kind of unwarranted facelift, if you will.
And for all the examples of genuine social entrepreneurs doing really, really great work, all of that, and labels, greenwashing and social washing of mainstream businesses.
And also, Session. Price doesn't really engage with the fundamental problem on the whole. Which which is kind of over consumption and the neoliberal economy.
So so it doesn't critique what's at the core, of, of the over-consumption that's driving much of the challenges we see in the world.
Hmm. Wow. That's gonna open up some. Thinking here.
I know wonder. Had them importance of finance been less, you say, you know, over-emphasized.
If finance had been less out there would have social enterprise. Add another Avenue.
Hmm. I think that's a really interesting way to think about it because we get so box into, this mindset of enterprise, being the solution to things.
And we, you know, we see this over the last decades with charities feeling they need to be entrepreneurial or you know kind of sort of programs that encourage, you know, if you do a bit of trading, we'll give you a bit of grant on top.
This idea that trading is, is a fundamental good. And, and this doesn't leave space for civil society, for voluntary action, for, you know, loving and laughing, you know, all of that stuff that really, really matters and that makes us human.
And can get crowded out by this unnecessarily prominent voice of entrepreneurship and we see this in you know, you know, it's kind of comical really when management consultants come into charities and tell them how to do things or indeed into the government and tell them how to do things because applying an entrepreneur or business mindset to all of our all the elements of our world.
It's not what any of us, that's not really a world that I think most of us want to live in.
Hmm, are you advocating for post-growth? Life here.
Well, if it's, just come, you know, with it, with a bunch of associated kind of, I suppose, ideologies.
And, it's Like, if we think about this globally in terms of justice. We have to be really cautious about that right it's all very well for middle class people in academia like myself to talk about such things but we need to find a just way of sustaining the planet and our populations through through through the next the next years ahead.
And so it's interesting I always do a little bit work recently thinking about fertilizer usage and it's such a great example.
Because overuse of fertilizer is a terrible pollution, not a totally bad thing. And happens in many areas, but there are also significant areas of the world where underuse of fertilizer means that an insufficient crops are being grown to feed people.
And that means that crops are being grown over a larger area, which means there's less space for biodiversity.
So it's not that we need to not have fertilizer. We need to have appropriate use of that.
So the wealth or the beauty of the gems are in the detail. The refining design and really think through.
Yes, it's quite it's quite hard to do broad brush things particularly when we're when those of us in the global north.
Have to or should be constantly thinking about. Rebalancing and correcting the injustices of the past.
And it's very hard for me from my position to like know how things might work through in other contexts.
So humility is really important in that.
Hmm. Hmm. So I guess that's the key takeaway so far from your quest to impact.
Belinda, what are your other takeaways? From your quest to impact today.
Well, things that appear to be radical. Can very often turn out to be maintaining the status quo.
And I think we can say that basically for the social finance movement that I entered. Like 20 odd years ago.
Which was talking at that time. Of kind of radical re conceptualizing of how finance worked and how capital was acquired and used.
And for the most part. Like that simply hasn't happened and not only that we now have a kind of social finance field for the most part, which is a sort of like out of week reflection of regular finance, which kind of, you know, wasn't the point.
And there are parts of the sector that kind of avoid these and, and this stuff going on, in, in, in, in, in, in, in, in, amongst cooperatives and mutuals and globally, which is radical but it's it's really interesting how frequently radical, things turn out to It's either lose that kind of radical edge, you know, or to some happy
subsumed by the status quo. And I think that for myself as an individual, you know, I operate within the university as a, as an outsider, but let how long can I be inside the university and still retain that outside outside a mindset?
That's a that's a question for us. We do this sort of work from within big institutions.
So there again another paradox to Flexi muscle. Any other takeaway from your quest to impact you want to share with us?
Something maybe that wasn't Maybe based or, you know, calling or your angry or cynical side, but what about the curious and hopeful side?
Well, the good news is that, Most people are really decent people trying to do good things and I mean that most people across the board in all of our.
Institutions or families or you know community groups or whatever. So. That is, so that's so reassuring.
So I'm not cynical about people. And people, like want to share, they want to collaborate, they want to cooperate.
And if we frame that as normal. Then it's easier for people to do so. And I think that ideas around kind of norm formation are really important about how we can normalize the kind of world that we want to see.
And live it in advance of it being here.
Hmm, normalize the world we want to see. Bring the future here. And make it a norm.
Okay, so let's talk about universal owners and see the definition universal owners or institutional asset owners or pension funds, mutual funds, insurance companies, sovereign wealth funds, etc.
That on such a representative slice of the economy is to find it impossible to diversify away from large system-wide risk.
So what do you do with this at the moment? That sounds like a big chunk of work.
Yeah. So yes, after I am after I left, the kind of social enterprise field directly, I've, found myself working with a colleague, Dr.
Anne Quigley, on work related to universal ownership and you just kinda Right out one of those definitions there.
So yeah, universe line is, they are in the largest pool of capital in the world, that pension funds, endowment funds, so from wealth fans.
And these are really interesting pools of capital because if you're an endowment fund or a pension fund You really have a long-term vision.
You're thinking about how do I maintain this endowment over decades or hundreds of years. And if you're a pension fund, you're thinking how do I pay this teacher their pension in 30 years time?
If you're lucky.
So they have much longer term time horizon than we think of in the finance sector in general. And also they're really really big pools of capital which means they They can't divest from all the bad things because basically everything's a bit bad.
So then they've got lots of money. So they have to put it somewhere. So and they have to diversify across because that's how we manage big pools of money well is to diversify.
And in this case, what we find is that if a universal owner has in their portfolio a particular firm, they might not want that particular firm to maximize its profits if in maximizing its profits it causes externalities which damage the rest of the portfolio.
So if we have somebody pumping out, I don't know, air pollution that's making the workers in the country you see say that's gonna make it hard for my other companies to work because all the workers are sick.
And so, and this is in general, it's about thinking about externalities. Because there is no externalities.
There's just feedback loops that haven't. FED back yet and we're seeing them start to feedback now.
And so interestingly these universe owners that have such enormous wealth are also potentially very, very well positioned to help us address systemic risk and systemic challenge because they they have this long-term vision and because they have a diversify portfolio so they can see that if parts of that portfolio are causing damage to the underlying systems that we all depend on and that might be the environment but it could also be stable societies.
If they're if they're causing damage to that then at some point your portfolio loses value.
And so the work that we do now is working with, you know, us to help them to think about how they can steward our systems so that we can, navigate the years ahead.
Well, that sounds simple. What are the main challenges? That you face and, you know.
Bring these people along. Change of thinking
Well again, people already positive people. You know, I, I'm, that most people are sort of desperate for answers and to do what they can to change things.
And but this particular work is not historically been widely done. And so it's so it is like, been, widely done.
And, so it is like, thinking about things in a new way. And, so it is like, thinking about things in a new way, it's introducing new terms, it's, thinking about things in a new way, it's introducing new terms, it's drawing connections between interconnected areas.
And this, of course, is the one chance, it's drawing connections between interconnected areas.
And this, of course, is the one challenges between interconnected areas. And this, of course, is the one challenges working with things systemically is it is hard to put back boundaries around where one bit ends of one bit one bit begins.
And but we have to, I suppose, demonstrate an act in hope to show that there are ways that these very very large owners of the companies that we all interact with every day can, can influence those companies to, to change their practices.
Now, quickly, to help, us all thrive in the future.
What do you need?
What do I need?
Yeah, to make this work. Happen more quickly.
Well, it be nice if we started a few decades ago. This is a problem, right?
The, the shortage of time. And the show should resources, we don't have a huge resources on our team, but also the kind of when we're trying to change ways of thinking or add new layers of thinking.
People need time to get up to speed with that. And yet we don't sort of have time.
So it's interesting some of the work we do is about trying to work collaboratively to demonstrate quick wins so that, so that the practice of working in this way becomes, you know, tested, I suppose, so that we can move forward more rapidly.
So working quickly. But needing more time. There's a lot of paradoxes in half an hour.
Yeah. Yeah, and I think that's so interesting you mentioned at the beginning about, I think you said something about the, yeah, thinking, into future or near and far future and.
You know, I think what this is talking about, I think one of the challenges that the environmental sector has had is in Demonstrating that this positive hope But if we do that, then it takes away the incentive for a media action.
And so that's quite a difficult balance, right? Because we don't want everyone to despair and give up and that's a real concern amongst young people.
But on the other hand, we need to be very serious about the urgency that we need to address things in.
So it is interesting thinking about here it camebridge we have the colleges have endowments and you know this is an 800 year old institution it thinks in really long time scales and that's fabulous.
And but we need really rapid change in real, real actions right now. And so that it is quite difficult holding both of those things to be true.
So if you were given You know, 1, 1, one, Maybe I sleep on time. What more?
What more would you do to advance that work? But more would you? Do you think feel do or say?
I think we don't know enough. Unfortunately, about how to actually get people to do things. So this is like it becomes a social science and a social psychology question because.
We know from. On climate change, we know from the science things things to be done, we know from the economics that things need to be done.
But how do you actually get people to do things? Like this question about how behavior is actually changed. It's really complex.
And again, it's sort of interesting because historically the social science is like kind of always think, well I think that it's right have been sort of gendered, right?
I've always think, well, I think that it's right have been sort of gendered, right?
And things that think it thought of as as feminine, but it turns out they're just as feminine, but it turns out they're just really hard and feminine, but it turns out they're just really hard.
And this is why women, when we had to focus on it. And unfortunately, you know, this is why women, when we had to focus on it.
And, unfortunately, we, we had to focus on it. And, unfortunately, we, this is really interesting question about even when people know what that what they can or what they should do or what would be a good question about even when people know what they can or what they should do or what what they can or what they should do or what what would be a good thing to do.
A range of things, and what would be a good thing to do, what they should do or what they should do or what would be a good thing to do, you know, a range of things sometimes stop them actually doing it.
And so, working to know more about what is that the handholding is it? I think sometimes in the past people that people need more education, but we give them more education and still change doesn't happen so it's not education.
What is is it the handholding? Is it collaborators? You know, what is it shaming people?
Is it being really angry at people? Probably not. But what are the things that actually enable people to do things differently?
Because I think as humans, we many of us tend to not like change.
Well, I don't know if it's the answer, but you've just given me a massive insight today by being able to hold paradoxes and, and do that kind of impact work.
And advance it and making judgment calls and also, I've gather rapid, fantastic insights, the capacity to hold Paradoxes hope to maybe move on.
And so is I wonder, and again, that's the question I'm asking you, and a question I'm asking also the audience which I invite to think along is to invite people to do stuff.
It's not as well giving them the permission to, you know, be hopeful and angry at the same time.
Not being either one or the 2 direction, but going 2 direction at the same time. Don't know what that looks like, but what do you think?
Well, I mean, I'm consciously the older I get that to recognize that there are different personality types and some people may not need that.
And but for me it seems Well, the hope is, and the hope is, is a practice. in it's, like, for me, I couldn't carry on without, without that.
And There's no, there seems no point in just being angry and shouty. But I worry about people burning out and just, you know, being frustrated. We're talking about young people working in our movement.
But, in general, that the people's anger like might eventually. Burn itself out or become ineffective because again, coming back to what I said, most people are decent people trying to do the right thing or wanting to do the right thing.
So we have to try to understand the barriers. And this is very frustrating. It's very frustrating.
But also, you know, if it was easy, like somebody else would have done it already. And if, if it was easy, it wouldn't be fun.
Like personally, I kind of, you know, would like to do things that are challenging. I'd also like to think that we could actually succeed.
So we'll see.
Hmm. There's hope as well and there's yeah the belief that we can succeed. Well, thank you so much for that.
That warm bath into paradoxes of no paradox in the future and to explain as well how you work with these universal owners and your journey as well how you work with these universal owners and your journey from social finance, owners and your journey from social finance, social enterprise back to social finance.
That's it for today. What an amazing set of insights. And I wonder what what about you?
What came up for you if you like to? Dig deeper into the topic and also try other questions for yourselves.
I think you can just re listen this show but also dive into the whole podcast series that contains a lot of a lot of juicy questions as well.
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