This report seeks to draw on and extend existing work around anchor institutions and the local wealth-building movement by developing an understanding of how anchor institutions can realise their economic and social potential by supporting community businesses.
What are anchor institutions? Anchor institutions are sites of ‘sticky capital’ which make a significant contribution to the local economy as employers and holders of land and property assets. They are defined by a number of key features, as defined by the UK Commission for Employment and Skills (Mosavi, 2015), including their:
- Spatial immobility – anchors are unlikely to leave a place once they have taken root, as they have strong ties through invested capital, mission and relationship to customers and employees
- Size – they are large employers with significant purchasing power
- Tendency to operate not-for-profit – while there are examples of for-profit organisations as anchor institutions, such as airports and football clubs, it is much simpler for private businesses to move, meaning there is ‘no guarantee they will continue serving the local community in the long term’ (Mosavi, 2015).
Examples of anchor institutions include local authorities, universities, hospitals and clinical commissioning groups, religious institutions and housing associations.
At CLES we believe that current pathways to economic development focus too much on external development, and not enough on inclusive economic approaches which seek to ensure that economic activity supports local supply chains and benefits local people. Building from within is crucial to a good local economy – harnessing the available assets, businesses and people to make sure investment and pre-existing wealth is used for local benefit.