–The following is an extract from the Unlocking Investment and Finance in Emerging Markets and Developing Economies (EMDEs) World Bank program
–Building Robust Financial Markets and Institutions in EMDEs presented by Svetlana Klimenko
The role is changing rapidly as profound shifts in today politics technology demographics and climate have raised the stakes for policy makers. Any missteps will post high risks for society investors and the environment. Consequently a closer alignment of interest has emerged between public policy and private investment. Business leaders are now seeking to have a greater influence in shaping this emerging eco system. In this context there is an unprecedented opportunity to argue straight public and private action in the ways that lead to high private yield and high sustainable impact.
Getting this right can set the motion and important that could shape markets and development for decades to come. International financial institutions such as the World Bank group have an important role to play in this. Through our convenient power by leveraging our combined balance sheets and through our knowledge and innovation we are well placed to help shared this new course by new turn governments and private sector collaboration around shared objectives the World Bank group can help to build mutual trust and discover areas of shared interest. While earlier efforts in this area have yielded mixed results some significant breakthroughs have been achieved. Partially driven by shared urgency around areas of opportunity and the risk. Today the private sector has a direct stake in the stability of global financial markets in the terms of trade between countries and an encourage in long-term sustainable investments.
For her to act promptly in these areas is increasingly likely to affect the bottom lines of companies doing business internationally and domestically. These concerns have led to a new harder of private sector leaders to understand their impact on the society is and they living. Firms that collectively managed to lance in assets understand that they’re as strong force in the world and then they bear shared responsibility for unsustainable further and self-investment and production. In short they realize that they are too big to lead the planet’s fail. In the environment social and governance or in short ESG issues have traditionally been of secondary concern to investors. But in the recent years institutional investors and pension funds have grown too large to diversify away from systemic risks forcing them to consider the environmental and social impact of their portfolios.
Analysis of interviews may seventy executives in forty three global institutional investment firms suggests that ESG is now a priority for these leaders and the corporations will soon be held accountable by shareholders for their ESG performance. This new strategic outlook is supported by recent research that shows ESG investments are outperforming non ESG investments in the long run. In other words sustainable investment makes business sense. TO respond this shift and focus companies must publish a statement of purpose provide investors is integrated financial and ESG reports increase of the involvement of middle managers in ESG issues invest in the robust IT systems and impose internal systems for measuring and important ESG and impact performance information.
On the other hand since the SDGs were adopted in two thousand fifteen this led to the convenient of CEOs with resilience of assets on their management to gather his international public policy leaders and regulators. For example then network a Swedish investor sustainable development established two years ago has become a growing force. 18th Swedish institutional investors and banks participate in this network are aligning in their investment strategies and activities they support is the sustainable development goals. In November world believes in an investment public policy and regulation gathered in Argentina on the sidelines of the G20. These included managers combined assets of over billion US dollars to discover new ways to collaborate to advance sustainable long-term investing globally.
In November globally there is in investment public policy and regulation they’ll get there again in Chile this time on the sidelines of the Asia Pacific economic cooperation summit to continue to build momentum. The business 20 and known as B20 recently registered for tribal society five point zero for the SDGs. It will be launched at the G summit in Japan in June. The report shares a business vision for the future of global society. It focuses on such areas as digital transformation and their environment high quality infrastructure and the future of yours. I’m confident that this transfer continue to deepen and grow in the coming years as a global businesses is assume new role and sustainable invest in a rapidly becomes the new norm.