UNEP news Centre - New Report Identifies Key Innovations to Bridge Sustainable Development Investment Gap
Nairobi, 21 January 2015 - A new report released today by the United Nations Environment Programme (UNEP) identifies critical innovations in the US$300+ trillion global financial system, which, if brought to scale, could help close the widening sustainable development investment gap. The report is being launched at the World Economic Forum at Davos - at the outset of what promises to be a momentous year for sustainable development.
Following the financial crisis, increasing focus is being placed on how the financial system can fulfill its underlying purpose to serve the long-term health of the global economy. The new publication, Pathways to Scale, is the 3rd progress report from the UNEP Inquiry into the Design of a Sustainable Financial System and draws on work across 12 countries and a range of critical sectors such as banking, insurance, investment and securities. A key problem is that financial markets still do not effectively price environmental resources, with the result that the value of natural capital stocks such as clean air, productive soils and abundant water is falling in 116 out of 140 countries across the world.
The Inquiry's high potential innovations include three major asset pools:
- Banking: Banks hold the largest pool of global financial assets (US$139 trillion), and leadership by developing countries such as Bangladesh, Brazil and China in 'green credit' regulations points to a new phase in international banking standards.
- Bond markets: The largest capital market (US$100 trillion assets) and fastest moving theme, with a tripling of 'green bonds' issuance in 2014 and the prize of incorporating sustainability factors such as climate risk into routine credit ratings.
- Institutional investment: With US$93 trillion in assets under management in pensions, insurance and sovereign wealth funds, new investment structures, changes to investor governance and reform of incentives (such as remuneration) could underpin the next generation of sustainable investment...
For more Information, please consult the following Link:Here
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