The main topic of the conference was dedicated to the development and possible enforcement of the European Union’s uniform ESG standard for the financial industry. What we will have as a result is that sustainability will no longer be just an issue dealt with by the social responsibility departments of individual companies, but it will find its way into the core business of entire industries.
“Companies and industries that are not moving towards zero-carbon emissions well be punished by investors and go bankrupt”, as Mark Carney, Governor of the Bank of England states in October 2019.
Various Swiss Financial institutions have recognized the importance of sustainability and have integrated ESG standards into their mainstream products. Due to its strong influence, the financial industry is thus assuming a leading role in introducing sustainability standards across the board. Sustainable Investing and Lending AuM in 2018 in Switzerland was CHF 717 bn (Swiss Sustainable Investment Market Study 2019).
But is ESG integration enough to really contribute to the change and such challenges as biodiversity?
WWF in collaboration with PwC have published a study which underlines the importance of it and clearly indicates the tremendous negative implications on biodiversity due to global warming. For those who do not care about the nature but about risks, it is important to understand that there are huge economic costs and financial risks associated with biodiversity loss. Transitional, Physical, Litigation and Systemic risks are named.
As per the research, the world lost an estimated USD 4-20 trillion per year in ecosystem services owing land-cover change and USD 6-11 trillion per year from land degradation. The inaction would cost us 7% of GDP by 2050.
What about taxes and sustainability?
“Corporate tax transparency is the next big sustainability task. In 2018, at least 90 hugely profitable US corporations paid NO US tax at all – an outrage that is not sustainable morally or in light of the societal investments needed worldwide”, Elise J Bean, Former United States Senate tax investigator.
The World bank states it clearly, that “…if we are order to meet the Sustainable Development Goals (SDGs), reach our ambition to end poverty, reverse inequalities and curb climate change by 2030, serious action on taxation will be crucial”.
Therefore, I invite all corporations not only to think about the above but start acting to meet social welfare obligations between citizens and the economy.
At the end of the conference, we had a lively dialog with the audience about what is SDG investing, what is impact investing, what are practical examples and of course about the role of education in impact investing sector. We are still facing financial institutions where the client advisors and clients not aware about the difference of sustainable and impact investing and mixing it up.
To finalize, remember that at the end, it is all about sustainability in all aspects of our economy and business, meaning, to secure present needs without compromising the future generations ability to secure their needs. My dear Human, just act accordingly whatever industry and position you are!
The Week showcased the unique power of the ecosystem present in Geneva and Switzerland, and the special role it can play in accelerating the implementation of the 2030 Agenda through finance. I have contributed as a speaker to raise awareness about impact investing and sustainable finance. It was discussed how individuals can go from spectators to actors in impact investing. There are more and more project holders and private investors willing to act, however raising awareness is still needed for a larger social impact.
In my view, to achieve the SDGs, impact investing must become the new normal. For this financial, governmental, education, and regulatory sectors need to unit forces and the private sector to get engaged.
Among finance professionals, scientists we had guests from United Nations and Swiss Sustainable Finance Geneva which truly appreciated our definition of impact investing and the way we’ve explained it making it crystal clear for all, independent from the background.
After being a speaker at various investing events and conferences in a raw, giving two sessions at Finance Summit was kind of a cold shower. A deep dive back to the traditional world of finance and representing the “new trend” impact investing to the believers of traditional investments, risk and return paradigm.
The interactive workshops and discussion in rather smaller groups was a complement to the larger sessions, allowing delegates to share their collective experiences and to learn how their peers are dealing with similar situations.
I must say that the most of the financial actors are already aware of the necessity of change in the financial industry, however the most are still observing. Some are waiting for stricter regulation and policies to be imposed by government and financial regulator, the others, just don’t have the decision power to move towards impact investing and more sustainable investment. And are forced to follow the existing investment policies.
Well, transformation will take time, courage, visionaries who are able to see the long-term development and lead accordingly through wicked problems. To be successful both, top down and bottom up action are needed.
The first actors will take the advantage in many ways: gaining new clients, keeping the existing ones, motivating employees to stay enriching their jobs with meaning and increasing their loyalty, getting NEXT GENS on board by caring for SDGs (sustainable Development Goals). Last but not least at all, positive returns from Impact Investments -in many cases outperforming traditional investments and having lower volatility and correlation to the market. It is time to move, dear finance leaders!
For 4 years, SIIA invites a broad universe of networks seeking to make an impact through either investment, businesses and service providers.
The audience is mixed: from Asset Owners (Family Offices, Philanthropists, Governments, Impact Investors, Business Angels, NGOs, Investment Networks, Faith Organizations, and Foundations) it stretches to Business & Project Owners (Entrepreneurs, SMEs, Listed & Unlisted Corporations, Semi-Governmental Organisations, NGOs, Foundations, and Family Offices). Last but not least the attendance of Service & Knowledge Providers: Financial Institutions, such as Banks, Insurances, Independent Asset Managers, Multi-Family Offices, Investment Funds, Universities, Associations, Regulators, Lawyers, Consultants, Independent Impact Advisors, and Scientists is truly appreciated.
The complete picture and presence of the ecosystem allows in-depth dialogues, discussions, connections from various aspects of an issue. And of course, it is action oriented! Projects find investors, partnerships are happening directly at the conference!
I would highly recommend not only to Swiss based actors but also to international ones to experience this impact summit.
The next Impact Summit Zug is set up for 26-27 October 2020.
Peace Palace, The Hague, Netherlands. 24-25 March 2019
Impact Summit Europe is Europe’s leading annual impact investing conference for institutional investors and asset owners, bringing to life a vision of tomorrow’s world with today’s investments.
There were many actors and financial institutions speaking about sustainable investments, however, the real action all was remarkable from Sir Ronald Cohen and his book “Impact Revolution”.
A few quotes to inspire you to get acquainted with what could be done by various actors:
"We must act now, there’s never been a greater need or a better time."
Our world is in trouble. Disquiet and uncertainty have frozen us into inaction. Yet there is a powerful solution within our grasp: impact.
Consumers, pension savers, philanthropists, investors, entrepreneurs, social sector organizations, governments and big company leaders—all of us play a critical role in the Impact Revolution.
To speed the advance of the Impact Revolution, let’s act now on 7 fronts:
As consumers, let’s purchase products and services that help improve lives and protect our planet.
As pension savers, holders of insurance policies, and owners of investment portfolios, let’s push our investment managers to make Responsible and Sustainable Investment allocations of 50%+ of portfolios, and impact investment allocations of 10%+.
As entrepreneurs, and young ones in particular, let’s develop innovative businesses that deliver and measure positive impact, and let’s run them in a way consistent with our values.
As managers and employees of companies, big and small, let’s push to set impact objectives, and to report on their achievement.
As citizens, let’s lobby our governments to encourage investors and businesses to make decisions based on risk-return-impact; adopt common impact accounting and reporting standards; and direct unclaimed assets in banks, insurance companies, and investment funds, to impact capital providers.
As philanthropies, big companies, official development aid agencies, governments the World Bank Group and other development banks, let’s establish big professionally-run Outcomes Funds to pay for the impact achieved by SIBs and DIBs.
And let’s spread the word ON IMPACT, contributing to it as our living guide, at onimpactnow.org - and share our actions and views under #ImpactRevolution.”
What is TBLI? Triple bottom line (abbreviated as TBL) is an accounting framework with three parts: social, environmental (or ecological) and financial. These three divisions are also called the three Ps: people, planet and profit, or the "three pillars of sustainability". The "I" stands for investing and thus as a whole refers to investments made involving the aforementioned, three bottom lines, instead of just one.
All TBLI conferences represent a:
A carefully curated program tailored for both ESG and Impact Investors
Practical Workshops with case studies, market analysis and lessons learned
Interactive TBLI Masterclasses on opportunities, innovation and risksHigh-Level Plenary Sessions with seasoned ESG investors, entrepreneurs, CSR and SRI specialistsEntrepreneur Pitching Salon featuring pre-qualified businessesMy own thoughts and experience about impact investing conferences was supported by the frustration of one of the participants of the workshops “How to identify Risks and Opportunities”, who was on one of the first TBLI conferences around 20 years ago…The main discussion opened around that simple ESG investments currently offered by many financial institutions are simply not enough anymore to contribute to climate change nor to main other global issues that the humanity is currently facing.
We are “overreporting”, we are “over discussing” about impact measurement and performance, we are “overregulating”, but we aren’t overacting for “deep” impact. We are not supporting enough early stage start-ups with high social and environmental impact, we are not making it easy to fundraise even for the existing impact business for them being able to scale their solutions for the planet. We are still having a “capitalist” mind set and craving for no risk but market returns, so no wonder that the frustration changemakers, trying to shift the consciousness toward sustainability after 20 years in the industry is taking over sometimes.
For the new comers in the impact investing industry it might shine that the true impact is happening right now. What I see after 6 years in the industry, that it is still moving too slow. We need more actions, decisions, changemakers in the leading positions who can take serious decisions and move key financial institutions towards deep impact.
I am sure we will evolve. But, truly hope, that it will be on time and not too late for future generations. It is undeniable that we need financial leaders who can step out for the planet and social challenges. It is them who will gain the pride back of being a banker or financial professionals.