New research from SGS Economics and Planning and Neighbourhood Economics examines what is holding back wider adoption of community wealth building (CWB) as a model of local economic development.
The paper, Community Wealth Building: What will it take?, forms part of a broader suite of work on the economies of Norlane and Corio – two suburbs of Geelong, Victoria – and is intended as a starting point for recognising and addressing the barriers that stand in the way of more resilient and inclusive local economies.
“Local economies desperately need economic transformation which will be achieved through collective
action and collaboration,” the report says. “Understanding the scope of potential barriers highlights that good intentions are not enough. They need to be turned into economic action that address and break through these barriers and embed a positive economic future.”
And it warns that action is needed to tackle wealth and inequality in Australia, which is “widening,
creating fissures in many communities and economies”.
In 2019-20, says the report, households in the highest income quintile received 40% of total income, while those in the highest wealth quintile had 63% of total household wealth.
By comparison, households in the lowest income quintile received 7.4% of total income while those in the lowest wealth quintile owned less than 1% of all household wealth; “a pattern that has persisted for over two decades”.
The report argues that community wealth building has the potential to tackle this by transforming local economies and creating greater prosperity, health and wellbeing for people, planet and communities.
Related: Scottish Parliament passes law on community wealth building
However, it is not widely adopted as a mainstream economic development practice – and the report identifies a set of longstanding and interconnected barriers that continue to limit the creation, retention and recirculation of local wealth.
Those barriers sit both across the model as a whole and within each of its five pillars: progressive procurement of goods and services, fair employment and just labour markets, socially productive use of land and property, making financial power work for local places and plural ownership of the economy.
The report argues that community wealth building works best when these pillars reinforce one another, rather than being treated as isolated initiatives.
”There are clear opportunities for CWB to shift from the margins to mainstream to build a better economy for all. Against a backdrop of intersecting crises in Australia, CWB offers a structured model and action agenda for change.
“As international experience has shown, the existence of barriers need not block the local wealth building mission. Nevertheless, it requires concerted effort to challenge the status quo.
“CWB also presents a clear solution to these problems, many of which have stemmed from a neglect and underutilisation of resources in plain sight: the power and spirit of Australia’s successful co-operative and mutual enterprises, as well as the sheer scale of (and latent potential for) Australia’s superannuation funds to shape the landscape of impact investment.”
Related: Building community wealth in the cracks of a broken economy
Australia’s Business Council of Cooperatives and Mutuals (BCCM) says the paper is “especially timely given international developments” – such as the passage of the Community Wealth Building (Scotland) Bill in February 2026.
“For the co-operative and mutual sector, the relevance is clear in the report itself,” says the BCCM. “One of the five pillars is plural ownership of the economy, which the paper describes as encouraging different models of business ownership so that wealth stays in local communities. It specifically notes that co-operatives and mutually owned businesses can help counter the extraction of wealth that otherwise occurs when corporate economics prevails.
“The report also identifies a distinct set of barriers affecting plural ownership in Australia. These include under-appreciation of co-operative and mutual enterprise success, outdated co-operative law and underdeveloped guidance, scarce resources for co-operative formation and survival, legislative uncertainty around employee ownership trusts and distorted perceptions of risk associated with co-operatives and mutuals.”
BCCM added: “What makes the research useful is that it does not present community wealth building as a single policy lever. Instead, it shows how procurement, employment, land, finance and ownership all shape whether local wealth is retained and shared. In that framework, co-operatives and mutuals are not peripheral. They are part of the ownership structures that allow local economic value to remain anchored in communities over the long term.”
