Resourcing change processes | Te whakawhiwhi rauemi

Once you know what you want to do, the next question is how you are going to resource it. Your plans can be adjusted if needed resources are unavailable, uncertain or delayed.

You need to think about resources: access to funding, financing, expertise, equipment, materials and – perhaps most importantly – time. It is rare that a project has access to all the resources it wants. However, by taking an adaptive approach and adjusting your goals, worthwhile projects should be able to find the needed resources.

To achieve transformative responses to climate challenges, locally led initiatives must become widespread and normalised. This won’t happen without support. Communities need to be adequately supported and resourced to develop and carry out their own resilience strategies. From this they can build a body of knowledge and experience that can be shared with others to amplify the benefits.

“To do honour to the importance of securing a just transition, you need to recognise early on that significant time, effort and resourcing are going to be needed to sustain and maintain a partnership that can deal with the issue. Recognise up front that it's hard work, it’s wide ranging and it’s expensive.”

Just Transitions Dialogue participant

In-kind contributions

One part of resourcing your transition is through in-kind contributions. These are any non-monetary donation, such as the provision of goods, services, expertise or labour.

For example, a hardware shop might give timber for boardwalks for a local conservation project. An accountant might help develop a business case for a community energy scheme. An academic might contribute their knowledge to a community-led transport initiative. Or a community conservation group might spend their weekends restoring a coastal habitat that provides resilience from storm surges.

Sometimes this help is all you need to get a community project going. In-kind contributions not only provide critical resources but also mobilise communities by increasing trust, reciprocity and mutuality among members.

It’s important to value and acknowledge the people and groups that make in-kind contributions. Make sure people are willing and able to contribute, and do not put pressure on people to make an ongoing contribution.

Fundraising

Fundraising can be used to finance your project. This can be a great source of money, as well as building community motivation and engagement. Get creative on ways you can fundraise for transition in your community.

Fundraising(external link) — Predator Free NZ

Grants

Grants are cash transfers that you don’t need to pay back. Grants are important for projects, such as ecosystem restoration, that generate high social and environmental returns but limited or no financial returns. They are also important for early-stage projects which might become commercially viable at a later date but need direct support early on to scale up.

Central government and local authorities use grants to achieve an array of policy objectives. Examples include:

Warmer Kiwi Homes programme(external link)

Government investment in decarbonising industry fund(external link)

Low emission transport fund(external link)

Erosion control funding programme(external link)

Private donors also fund activities through grants. In 2019 it was estimated that nearly $35 million of philanthropic funding went to environmental causes, including climate change. About 4% of the total funding was provided by 102 donors.^[1] Businesses also provide donations for a variety of philanthropic, strategic, commercial and political reasons.

Government grants often come with high transaction costs, because government agencies need to demonstrate that they are responsible stewards of public money. This means the administrative burden of applying for public funding, reporting on milestones and negotiating contract variations can be significant.

Finalising sponsorship and donations from businesses can also be time-consuming. It diverts community groups from the work they most want to do or requires hiring people for funding and partnerships.

More advice on how to identify and apply for grant funding is available on the Just Transition Partnership website.

Resourcing just transition processes

Debt

Debt is money borrowed by one party from another, then repaid according to pre-agreed terms. The most common form of debt financing is loans which banks and other providers make available to individuals, households and companies.

Sustainability alignment is increasingly being integrated into debt financing. In Aotearoa New Zealand, banks are increasingly offering sustainability-linked loans which provide borrowers with a lower-cost loan if they meet sustainability targets.

Debt carries risks, though. Debt needs to be repaid with interest, and taking on debt is especially risky when interest rates are high or rising.

Equity

Equity is an individual’s or entity’s degree of ownership in any asset after all debts or liabilities associated with that asset are accounted for. Typically, ownership is held as shares.

Like debt, equity carries risks. Equity involves distributing ownership of assets and therefore decision-making power as well as responsibility for their impacts. In some cases, meeting the risk and return expectations of shareholders, as well as their strategic preferences, might not be compatible with intended social and environmental outcomes.

However, equity can be a sustainable source of financing for some initiatives. It also enables access to the expertise, resources and networks of shareholders. For instance, a circular economy initiative might become a social enterprise – a business with social or environmental impact as its primary purpose – and attract equity financing from impact investors.

Budgeting

To implement an action plan, you need to allocate funding, financing or in-kind contributions to each of the actions.

Budget allocation involves deciding how to use limited funds to resource a number of actions, taking into consideration the different priorities that the people involved in your transition will place on these actions. It is also important to consider which actions will increase your profile and potentially your support.

Participatory budgeting is one strategy for aligning the budgeting process with just transition principles of inclusivity and capability. This is where citizens are involved in the process of deciding how public money is spent, as well as scrutinising and monitoring the process following budget allocation.^[2]

^[1] 'Stocktake of Environmental Funding', Philanthropy New Zealand (PNZ). 2019, PNZ, Wellington. Available online at: 

Research reports(external link) — Philanthropy New Zealand

^[2] Participatory Budgeting(external link) — Local Government Assocation

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