‘Transformation of finance needed to put world on sustainable growth path’
Hendrik du Toit, CEO, Investec Asset Management.
How should investors frame their thoughts on sustainable development, and what role could institutional capital play in achieving the Sustainable Development Goals due to be set this September?
Speaking today at a Financing for Sustainable Development Forum co-organised by the Sustainable Development Solutions Network (SDSN) and Investec Asset Management in London, hosts Prof Jeffrey Sachs and Hendrik du Toit, CEO, Investec Asset Management, explored new frameworks for the role of public and private sector participants in achieving sustainable economic development. The Forum brought together leading figures across the spheres of financial services and policy-making.
Convened to discuss climate finance, infrastructure finance and global partnerships among other issues, the conference was one in a series organised by the SDSN in the lead-up to the Third International Conference on Financing for Development Conference, due to convene in Addis Ababa, Ethiopia, in July 2015.
Prof Sachs, Director of Columbia University’s Earth Institute, believes that a fundamental transformation of finance is essential in order to put the world on a sustainable growth pathway. He said, ‘Finance can be transformative by mobilising the world’s savings for the world’s future needs. Ultimately, sustainable development is about an investment framework – investing in the future to build a world economy that is productive, inclusive, and environmentally sustainable.’
Key components of this new framework include more focus on long-term capital investment project; more blended public-private investing, including in low-carbon power, roads, education and healthcare; widespread corrective carbon pricing, and valuation of companies according to sustainable development compliance.
In achieving this, new financial structures for combining public financing (through bonds, equity, and public pricing) with privately managed concessions on roads, ports, airports, hospitals, and other infrastructure, will be required.
Hendrik du Toit, CEO, Investec Asset Management, said, ‘As stewards of long-term capital we cannot ignore the welfare of future generations. We need to come up with practical ways to finance a more sustainable future for the world. There is a great deal of work to be done.”
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