The inaugural meeting of the Global Investors for Sustainable Development alliance, which is based on the design of a Swedish investor network, will take place in September 2019.
A plan of action will be implemented until June 2021 with assistance from a group of UN actors cooridnated by DESA and UNCTAD.
Scott Mather, PIMCO, said the SDG funding gap is small compared with "the size of the investable universe".
15 April 2019: UN Secretary-General Antonio Guterres announced a CEO alliance to support SDG financing, telling private sector leaders that investing in sustainable development is “not a matter of goodwill” but the root of long-term global prosperity. The alliance was developed by the UN Department of Economic and Social Affairs (DESA) in close collaboration with the Swedish International Development Cooperation Agency (SIDA), based on the design of the Swedish Investors for Sustainable Development.
Following a discussion convened by SIDA and DESA in September 2018, the Global Investors for Sustainable Development (GISD) was announced on 15 April 2019. The announcement took place as part of the SDG Investment Fair in New York, US.
During the announcement event, Guterres reminded business leaders that achieving the SDGs will require an additional USD 2.6 trillion each year for developing countries alone, as estimated by the UN Conference on Trade and Development (UNCTAD), and current resources are insufficient. He said substantial and long-term investment from the private sector are needed.
Scott Mather, PIMCO, observed that the SDG funding gap is small compared with “the size of the investable universe,” which contains about USD 200 trillion in tradable stocks and bonds, and “hundreds of trillions of private sector dollars.” Therefore, filling the funding gap for SDGs “is very much achievable,” he said, provided that everyone joins efforts in directing the available investment to produce more sustainable outcomes. Nicky Newton-King, CEO of Johannesburg Stock Exchange, added that there is no SDG “which an exchange cannot help achieve.”
According to DESA, one challenge to increased sustainability investing is that policies do not capture risks or externalities in pricing. Some institutional investors hope to change the definition of fiduciary responsibility to be able to capture those factors. The CEO of Sweden’s largest mutual fund company said companies need to work together on regulations to address “performance as a whole, not sacrificing planet, climate, humans,” while the head of a Swedish pension fund noted the need for more products for SDG investment and more forward-looking data.
The GISD will be comprised of 25-30 CEOs of large companies around the world. They are expected to harness their insights to incentivize greater long-term investment for sustainable development. The initiative is expected to be “CEO-owned” with the members developing working groups and networks as needed.
The GISD alliance’s inaugural meeting will take place on 23 September 2019 on the sidelines of the 74th session of the UN General Assembly’s (UNGA) high-level week and the UN Secretary-General’s Climate Action Summit. The alliance will then implement a plan of action until June 2021, reporting its results in September 2021.
A group coordinated by DESA and UNCTAD will assist the alliance in implementing its action plan. The group also will include other parts of the UN system such as the UN Global Compact, the UN Capital Development Fund, the UN Development Programme (UNDP), the UN Environment Programme’s Finance Initiative (UNEP-FI), and the UN regional economic commissions, as well as the World Bank Group and others. [UN Global Compact Press Release] [UNCTAD Press Release] [SIDA Press Release via DonorTracker]