7 December 2016: UN General Assembly (UNGA) President Peter Thomson convened an informal briefing to stimulate discussion on sustainable finance and means of implementation of the Sustainable Development Goals (SDGs).

Thomson stressed the importance of harnessing private capital flows towards sustainable development, and called on policy makers to consider ways to influence investment decisions to accelerate and intensify private and institutional finance towards SDG implementation.

Opening the meeting on 7 December 2016, in New York, US, Thomson reported that according to current estimates, implementing the SDGs will require annual investments of US$5-7 trillion. He said it is possible to establish sustainable financial systems that promote long-term investments for sustainable growth, foster social inclusivity, and encourage environmentally sustainable practices, but it will require governments to make “hard choices,” including on reforms of policy and regulatory frameworks, governance structures and incentive schemes.

Simon Zadek, Co-director, UN Environment Programme (UNEP, or UN Environment) Inquiry into the Design of a Sustainable Financial System, outlined the “stewardship role of the UN” in taking forward the SDGs, and in connecting the dots between planning and implementing the Goals. He called for aligning private finance flows with the SDGs, and for using public finance more effectively for the Goals.

McArthur said the core issue in sustainable financing is not “raising” money but “orienting” the money.

John McArthur, Brookings Institution, introduced a brief co-authored with Homi Kharas on ‘Links in the Chain of Sustainable Finance: Accelerating Private Investments for the SDGs, including Climate Action.’ He noted that the core issue in sustainable financing is not “raising” money but “orienting the money,” and remarked that companies, investors, policy-makers and regulators are all “links in the chain” needed for sustainable finance to operate properly. He also stressed the need to ensure consistency between UNGA discussions on sustainable finance and discussions within the Group of 20 (G20).

The brief reports that the US$5-7 trillion of annual investment required for the SDGs represents only 7-10% of global gross domestic product (GDP), and 25-40% of annual global investment. According to the brief, investments of this approximate order of magnitude are already taking place, but are being undertaken without deliberate intent to promote SDG or climate action objectives.

The Brookings authors recommend that UN Member States: present a “national action strategy” for sustainable finance in time for the 2019 session of the UN High-level Political Forum on Sustainable Development (HLPF) under the auspices of the UNGA, when Heads of State and government will review progress on SDG implementation; engage in coordination and peer review during the following year; and bring the results into the processes leading up to the 2020 deadline for presenting long-term national climate strategies.

The brief also suggests that UN Member States establish a 2023 deadline for fully implementing a globally coherent and sustainable finance system consistent with the SDGs; the authors note that 2023 will mark the midpoint for the 2030 Agenda for Sustainable Development.

During a discussion session, participants asked how to reorient financing towards the SDGs, and how to address corruption and accountability. The Russian Federation expressed concern about possible duplication between the work of the UNEP Inquiry and the Financing for Development (FfD) process, which also deals with the implementation of the sustainable development agenda, and asked about the added value of the Inquiry.

Macharia Kamau, Special Envoy of the UNGA President for SDG Implementation and Climate Change, outlined the importance of the UNEP Inquiry initiative as it helps clarify what the US$5-7 trillion mean and how they can be directed towards the SDGs. He said SDG implementation has “huge implications” for UN work, adding that unless the UN and its agencies are “fit-for-purpose” for the 2030 Agenda, the SDGs will not be achieved. He called for better synchronization between the different entities and processes of the UN system, including with the Quadrennial Comprehensive Policy Review (QCPR) currently under discussion, and with the UNGA’s Fifth Committee (Administrative and Budgetary). He also suggested that UN Permanent Representatives provide guidance to align UN work with the 2030 Agenda.

Thomson reiterated his commitment to drive implementation of the SDGs during his presidency of UNGA 71, and announced that other meetings seeking to discuss financing will take place during the session, including a high-level event on sustainable finance in April 2016. [UNGA President Statement] [UNEP Inquiry Website] [Links in the Chain of Sustainable Finance: Accelerating Private Investments for the SDGs, Including Climate] [UNGA President Letter and Draft Programme]