Once upon a time, investors would focus single-mindedly on getting the highest financial return, leaving social justice and the environment by the wayside. But the winds are changing fast: the climate crisis is exposing the financial sector to greater risks , while sustainable funds are already outperforming their traditional counterparts .<\/p>\n
So who are the key players in the fast-growing field of sustainable finance, and how are they working together to mobilize funds for restoration, climate and other green investments?<\/p>\n
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Sustainable finance involves making investment decisions that consider not only financial returns, but also environmental, social and governance factors.\u00a0Often used interchangeably with “green finance,” it is a broad term with multiple definitions depending on the context.<\/p>\n
Sustainable Finance<\/p>\n
The European Union describes sustainable finance as “finance to support economic growth while reducing pressures on the environment and taking into account social and [corporate] governance aspects,” such as inequality, human rights, management structures and executive remuneration.\u00a0It provides several examples of environmental considerations, including climate mitigation and adaptation, biodiversity conservation, and the circular economy.<\/p>\n
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Restoring our planet’s landscapes is one of the most important ways to combat climate change.\u00a0Forests and agriculture account for more than 30 percent of the solution to climate change, but receive less than 3 percent of climate finance .<\/p>\n
Ambitious restoration targets have already been set internationally, with the Bonn Challenge<\/a> aiming to restore 350 million hectares worldwide by 2030, while the United Nations Decade of Ecosystem Restoration has begun and is redoubling efforts to raise funds for restoration.<\/p>\n Closing that huge financial gap will require a coordinated effort between the public and private sectors, from the local to the global level.\u00a0As the sixth mass extinction accelerates and global warming breaks new records , policymakers and financiers have a responsibility to rise to the challenge.<\/p>\n <\/p>\n <\/p>\nWho are the key providers of sustainable finance<\/strong><\/h2>\n