Alumni Achievement Award winner leading the way in green finance

This Earth Day, we're shining a light on the net-zero heroes in our alumni community.

Research from recent Alumni Achievement Award winner Mark Davis (BA Social Studies, 2000) has led to the creation of Community Municipal Investments (CMIs), a new form of crowdfunding that empowers residents to invest in local net-zero projects. This innovative model has already raised over £12 million to support renewable energy initiatives across the UK, with the potential to generate £3 billion in funding through a national campaign. 

Hi Mark, could you introduce yourself and share your journey after Newcastle University? 

Yeah, sure. I have a Chair in Economic Sociology at the University of Leeds, where I’ve been since 2000, starting as a Master’s student after completing my undergraduate degree at Newcastle. 

Can you tell us more about your research and how this highlighted the alternative finance sector and viability of crowdfunding for local public bodies? 

My research focuses on the financial challenges of transitioning to net zero in fair and inclusive ways. Part of that is addressing the pressure local councils face, especially with reduced central government funding and the urgency of the net-zero challenge. Over the past five years, I’ve led projects exploring crowdfunding as a solution for councils to deliver local net-zero infrastructure. Collaborating with industry and public sector partners like Abundance Investment and Local Partnerships, together we developed Community Municipal Investments (CMIs) to help councils secure funding for these vital projects. 

Since 2010, councils have seen significant reductions in central funding—around 65p to every pound. This was worsened by the COVID-19 pandemic and fluctuations in traditional funding sources like the Public Works Loan Board and Salix financing for public decarbonisation measures.  

As an economic sociologist, I was interested in the paradox of people continuing to rely on institutions like high-street banks that they often distrust, even after the 2008 financial crisis. This disconnect offered a chance to explore alternative financing models like crowdfunding, with CMIs enabling individuals to invest directly in local environmental projects while promoting better transparency, accountability and ownership. 

So how did you then go about creating the Community Municipal Investments and testing their effectiveness in supporting sustainable projects? 

Working with partners, we tested investment-based crowdfunding as a new model of public sector finance, collaborating with three NHS bodies and three UK councils. From Spring 2018, we created a decision tool to guide council teams in evaluating crowdfunding models and worked with legal and professional firms to co-create CMIs. 

Brought to market as Local Climate Bonds, the model supports green and sustainable projects. They offer investors a financial return through debt or equity structures and also provide councils with additional and stable revenue to fund net-zero initiatives like solar panels, electric vehicle charging points, and retrofitting council estates including social housing.  

Investors face reduced risk as they primarily bear the risk of the council's continued existence, not the success of the specific projects themselves. The rates of return are competitive and comparable to UK tilt markets, and investors can directly contribute to local climate action.  

How successful have CMIs been so far? Do you have any major projects in the works? 

The first two local climate bonds were launched in the summer of 2020, during the COVID-19 lockdowns, in different socioeconomic and political contexts to show the versality of the scheme: one in rural, Conservative-led West Berkshire and the other in urban, Labour-led Warrington. 

West Berkshire’s bond was a five-year offer at 1.2% interest, successfully reaching its £1 million target five days early, attracting 640 investors. This funded rooftop solar projects in the community. Warrington also hit its £1 million target three days early, supporting a large ground-mounted solar and battery storage project. These successes have not only funded renewable energy initiatives but also helped accelerate broader green energy strategies, freeing up resources for council-schemes to combat fuel poverty and retrofit social housing. 

A significant outcome has been the shift in public trust towards local councils. Initially, as you might imagine, the idea of investing money with a council was met with scepticism! But as the projects progressed, and returns began to be paid, local residents began to see the tangible benefits through projects delivered in their community. To demonstrate the change in attitudes, in West Berkshire, for example, one in six investors actually donated their first repayment back to the council to help fund non-revenue generating projects like a rewilding scheme. This was recognised when West Berkshire won silver in the Green Public Service Awards and the Sustainability and Social Value Award at the SIPFA Public Finance Awards, both in 2021. 

Building on this success, the Green Finance Institute launched a national campaign in July 2021, encouraging all 404 UK local authorities to offer a Local Climate Bond. So far, the model we created has raised over £12 million for net-zero infrastructure projects across the UK, with interest growing in expanding the market for Local Climate Bonds. 

What challenges do you face with the CMI project, and how can alumni get involved? 

The biggest challenge we face is raising awareness and building knowledge about the initiative. There’s a growing appetite for individuals to be more conscious about the environment impact of their money, as signalled through ESG investing for example, but there’s still a gap in understanding the broader impact of financial decisions like savings and mortgages with banks.  

To address this, our goal is to engage major stakeholder institutions across different regions, such as building societies, regional authorities, universities, credit unions and large employers. We’re encouraging these organisations to take a closer look at Local Climate Bonds. With a low entry level of just £5, these bonds are accessible to most members of a community and offer a comparable rate of return, but they directly fund projects that benefit local communities. 

Finally, if you could give one piece of advice to a recent Newcastle University graduate, what would it be? 

My advice to recent graduates would be to stay connected with your university as much as possible. The alumni community you join after graduation is one of the greatest gifts from your university experience, providing invaluable networks and opportunities to support your professional development and to stay engaged with the university's ongoing work, whether in research or other sectors. 

It’s such a shame when graduates lose contact with their university. Alumni teams work hard to keep in touch and make sure you’re aware of all the opportunities still available to them after you leave. So, my advice is to meet them halfway – tell them what you’re up to and go along to events, because you never know where it might take you.  

Celebrating your success

The Alumni Achievement Awards celebrate Newcastle University graduates who are making an outstanding impact in their industries and communities around the world. Open year-round for nominations, the awards recognise exceptional alumni each quarter, with overall category champions honoured at the annual University Awards gala dinner.  

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