Financial system

Reorienting the flow of capital to accelerate the economy’s transition toward long-term sustainable development.

Finance is instrumental to the SDGs. The financial system helps to mobilise and pool savings and investments, as it provides payment services that facilitate the exchange of goods and services, helps to diversify, transform and manage risk, and supports the creation of new jobs and enterprises. Recent years have revealed a large range of vulnerabilities and weaknesses surrounding our current financial system. We have experienced how fragility of financial markets can rapidly spread to the wider economy and negatively impact sustainable development.

Although the world economy is highly decentralised and operates among millions of enterprises all over the world, financial resources are concentrated and managed by a much smaller number of financial intermediaries. This makes financial institutions key decision makers in the allocation of resources. In addition, financial institutions are well-positioned to influence companies’ long-term performance through effective stewardship that promotes positive change. These institutions, therefore, have a distinct role in the global economy when it comes to allocating and managing resources in support of the 2030 Agenda.

The SDGs

Scaling up and redirecting private capital towards the SDGs and climate investments through bond markets, public equity markets, bank lending and direct investments in projects and companies can contribute to closing this gap, benefiting all 17 SDGs:

Other transformations

 

Social

Agriculture and food

Decarbonisation
and energy

Circular

Digital

Urban