Understanding Sustainable Finance

What is sustainable finance? Although sustainability experts can be proud of their achievements, ultimately the world is not on a sustainable development path. There are at least three reasons why this should be of concern for financial institutions: firstly, they potentially face significant risk. Secondly, and as importantly, they are still linked with many of the activities that are at the root of the challenges to sustainability. Both banks and insurers provide essential services that support and sometimes enable such activities—which then in turn lead to risks for those financial institutions. Thirdly, there is a significant revenue opportunity to address.