Asset Pools : Institutional investment
- Align the design of pension and other investment systems with sustainability. Clarify fiduciary law and guidance and requirements for the skills and capabilities of fiduciaries. Build consumer literacy and require that funds report on sustainable performance and policies.
- Resetting market and public incentive structures would help stimulate demand for sustainable investment products. Market codes can encourage asset owners to align incentives down the chain, notably for investment consultants, asset managers and investment analysts. Policymakers could review the effective use of fiscal incentives for saving to drive long-term finance for the real economy.
This working paper presents an overview of Lender Environmental Liability (LEL) and Investor Environmental Liability (IEL) regimes and issues. Environmental harm and degradation is often irreparable. Therefore, our assumption is that precaution is the main objective of any international and domestic environmental legal regime. The paper explores the conditions under which LEL/IEL can be effective
A variety of interventions can be used to develop national financial systems and provide local access to affordable, long-term finance. This paper considers four key categories of actions: voluntary action; priority sector lending; regulatory or financial incentives as well as direct lending by policy-driven financial institutions. It particularly focuses on the role of policy-driven institutions such
Infrastructure is often referred to as the backbone of the global economy and plays a fundamental role in societies by enhancing the quality of life and increasing productivity. In addition to its effects on society and the economy, infrastructure can have significant impacts on the environment, depending on the choice of infrastructure. Approximately 75% of
Placing Indonesia’s economy onto a green and sustainable development pathway, as envisaged in the National Long Term Development Plan, will require a large mobilization of investment. Estimates of the annual investment needed are in the order of US$300‐530 billion, with a large portion of this investment needed in critical infrastructure, as well as environmentally sensitive
This paper provides an outline of South Africa’s financial sector, the environmental and social issues it faces, the response of government and financial regulators and the extent to which has resulted in measurable sustainable investment flows. In South Africa environmental, social and governance (ESG) considerations appear on the agenda of strategic discussions and are part of the
The US financial system is undoubtedly among the largest, most innovative and most sophisticated in the world. It is also clear that this is both a benefit and an impediment to non-governmental investment in sustainability and inclusiveness. To date, the actual investment in infrastructure and sustainability does not meet current needs, especially those related to maintaining
In recent years, a plurality of different governance initiatives has emerged that are designed to expand the disclosure of environmental risk within financial markets. There is evidence for policy convergence among different initiatives but it lacks the enforcement necessary for coherence, and contributes to uncertainty within the financial sector over the impact of environmental risk. This uncertainty justifies an expanded role of international
This paper sets out the case for promoting the development of green industry funds as public-private partnerships (PPPs) to use limited government funding to leverage private capital into green sectors. It is envisaged that green industry funds will serve as the platform through which private capital can converge into professionally managed green investments with government as one investment
Financial institutions today are unable to measure their exposure to climate change. There are equally no approaches to inform on the alignment of their investment strategies with national or international environmental goals. This report outlines international developments in measuring and managing climate related risk in instituional investment and banking. It outlines implications for regulators in
This paper set out the case for financial institutes and associations in China to establish a green investor network, to monitor investees’ performance of their environmental obligations, foster green investment capabilities, and hold educational programs. Internationally, green investor networks such as the UNEP Finance Initiative and the UN Principles for Responsible Investment have played a
- A Legal Framework for the Integration of Environmental, Social and Governance Issues Into Institutional Investment
Asset Management Working Group (2005). Geneva: UNEPFI.