World Economic Forum - What to look out for
The World Economic Forum (WEF) 2023 is upon us.
Last week’s Global Risks Report showed nature and biodiversity as key areas of long-term concern for both the Forum and the wider global economy, alongside the ever-present threat of climate change and the short-to-medium term challenge posed by Russia’s war in Ukraine.
Here’s our selection of what to look out for today and tomorrow:
- Open Forum: In Harmony with Nature | 16 Jan, 18:30 CET
- Mastering New Energy Economics | 17 Jan, 08:30 CET
- Financial Institutions: Innovating under Pressure | 17 Jan, 08:30 CET
- 2023 Explained: Chief Economist Briefing | 17 Jan, 13:15 CET
- Relaunching Trade, Growth and Investment | 17 Jan, 14:00 CET
- The Jobs and Skills of a Green Transition | 17 Jan, 17:30 CET
WEF has long been a supporter of sustainable finance, having published the Green Investment Report, which provides a comprehensive overview of the global market for green investment and financing. The Growth Action Alliance brings together leaders from the public and private sectors to mobilize investment in green infrastructure and other projects that support sustainable economic growth.
Bringing together leaders from the financial and investment communities to explore ways to promote sustainable finance and investment. This helps to identify the challenges and opportunities in this field, and to share best practices and innovations that can help to drive progress.
Scottish Taskforce for Green and Sustainable Financial Services: Meeting 4
The meeting took place at the RBS Accelerator in Edinburgh ahead of GEFI’s Festive Fireside event. The meeting commenced with opening remarks from Taskforce Chair, David Pitt-Watson, who provided a recap on the progress the Taskforce has made in 2022.
With no formal presentations on the agenda, the Secretariat provided an update on the progress being made on each of the 4 workstreams as agreed at the previous meeting.
KEY DISCUSSION POINTS
1. Education, Training, Qualifications and Research (ETQR)
The ETQR working group presented an update on the potential activity plan which includes: benchmarking Scotland against other global centres; engaging with Government around education policy; engaging with training providers (Higher Education, Further Education, Professional Bodies and employers) and exploring the scope for creating a Think Tank.
It was noted that efforts were continuing to promote the short brochure on ETQR opportunities in Scotland.
Finally, it was announced that GEFI is supporting Dubai International Finance Centre on Climate Finance Training Series for UAE finance practitioners. The first session involves a number of Taskforce members therefore providing a good example of Scotland exporting knowledge globally.
2. Investigating and Developing the Domestic Market
There continues to be a gap between investors and investible projects and this issue has been raised at meetings with Scottish Government officials, the Cabinet Secretary for Net Zero and the Minister for Business, Trade, Tourism and Enterprise.
Following a discussion on the First Minister’s new Investor Panel, members agreed that the Taskforce has a role to play in advising on how Scotland can create the right conditions to attract global capital investment to develop the physical infrastructure required for a just transition.
3. Mapping and Positioning
This update started with a summary of the branding workshop that took place early December. The workshop was intended to help identify key messages (script) that frame Scotland as a premier global location for green and sustainable Finance. A follow-up workshop is scheduled to review the findings and agree a set of final statements that can be used by Scottish financial services stakeholders.
Impact investing is emerging as a potential USP for Scotland and at its Investment Summit in December, the Scottish National Investment Bank launched “Unlocking the potential of impact investing in Scotland - A landscape review”.
Connectivity between Edinburgh and London continues to grow with TheCityUK hosting its regional conference in Edinburgh in December and the Lord Mayor and City of London Corporation delegation visiting Edinburgh early 2023.
Finally, it was noted that SFE hosted a webinar with Z/Yen on “Financial Services In Scotland - Edinburgh & Glasgow As Financial Centres” in October and that discussions are continuing with Financial Centres for Sustainability.
4. Product Innovation: Natural Capital
A working group has been established to explore opportunities for Scotland to leverage the work being undertaken by the UK Voluntary Carbon Markets Forum which has been established to provide a high integrity market ecosystem that aims to develop verifiable, and effective offset solutions.
Additional discussion
The meeting concluded with an update on plans to produce an Interim Report that the Taskforce Chair will present to Scottish Government in January 2023 and a discussion on how Scotland can leverage the announcement of the “Edinburgh Reforms” of UK financial services.
Management practice: The missing piece to sustainability
Current approaches taken by the private sector to sustainability are insufficient; they are atomistic, don’t address the root causes and do not take a holistic systems approach. They are failing people and planet as well as business and investment objectives, fuelling scepticism and concerns about impact washing.
Our future depends on the health of the ecosystem in which we all live, work, produce and sell. But we are not on a sustainable path, and we are a long way from achieving the UN Sustainable Development Goals (SDGs).
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SDG Financial Products was launched at COP26 by GEFI and showcases commercial financial products that are aligned to the SDG in order to share learnings and grow the ecosystem of SDG aligned financial products across asset classes.
The SDG Impact Standards provide guidance on developing an appropriate strategy, management approach, transparency and governance to assist businesses and investors in contributing positively to sustainable development and achieving the SDGs. The Impact Standards also provide a decision-making framework to make sense of existing relevant principles, frameworks and tools.
Fixed Income: From use of proceeds to delivering on sustainability
Several fixed income products explicitly aligned to the United Nation’s Sustainable Development Goals (SDGs), the world’s official developmental agenda, are now available including sovereign and corporate bonds and fixed income funds.
Mexico was the first to issue a sovereign SDG bond. In 2020, it raised $890 million for investment in projects with a focus on 11 of the 17 SDGs.[i] The SDGs are embedded in the bond through ‘use of proceeds’ criteria for eligible projects. Since Mexico’s inaugural SDG sovereign bond, it has issued a further SDG bond in July 2021 and others, such as Uzbekistan and Indonesia, have followed suit. There is clear appetite for these products in the market with Mexico’s first bond being 6.4 times oversubscribed.[ii] The motivation of sovereigns in raising SDG funding is clear, namely to achieve their commitments to the 2030 Agenda for implementing the SDGs and to focus finance on appropriate activities.
Thank you for reading the excerpt of this article.
To gain access to the full text, sign up below.
SDG Financial Products was launched at COP26 by GEFI and showcases commercial financial products that are aligned to the SDG in order to share learnings and grow the ecosystem of SDG aligned financial products across asset classes.
The SDG Impact Standards provide guidance on developing an appropriate strategy, management approach, transparency and governance to assist businesses and investors in contributing positively to sustainable development and achieving the SDGs. The Impact Standards also provide a decision-making framework to make sense of existing relevant principles, frameworks and tools.