strategy
Financing sustainable development
Context:
Bad financial management in terms of sustainability by society is one of the main structural causes of long-term deterioration of environmental quality, natural resources, welfare and well-being. The general response to the recommendations and commitments of UNCED regarding financing falls significantly short of expectations and requirements. Moreover, at the international level, prospects for achieving adequate, predictable, new and additional financial flows to developing countries for sustainable development are fraught with many challenges. Therefore, the goal of mobilizing financial resources for sustainable development makes it necessary to act on all possible fronts, including innovative approaches.Financial decisions and financial management by individuals and companies are to a significant extend influenced by two key players: governments, which dictate rules, apply economic and fiscal instruments and execute monetary policies; and financial institutions, which provide capital, insurance and other financial products.
Implementation:
The recommendations of the Sustainable Societies Initiative are: Provide financial incentives for sustainable communities and activities, and disincentives for environmentally and socially destructive practices at the national, regional and local levels. Use the tax system to support programmes which alleviate poverty and protect vulnerable and marginalized groups. Review the policies of international financial institutions to move towards more sustainable investment and debt structures.At the European level, the European Investment Bank claimed, in 1998, to have 30% of its assets in environmental projects.
Claim:
Agenda 21 and other outcomes of UNCED provide an important, agreed political framework for the financing of sustainable development. Matters related to the implementation of financial commitments contained in Agenda 21, including those related to the increase of overseas development assistance (ODA) flow and to such issues as terms of trade, commodity prices, market access, debt relief and other measures that promote a supportive international economic environment, are essential for the successful implementation of Agenda 21. Resolution of these issues must continue to be an urgent priority of international dialogue and decision-making processes that take place in the United Nations Commission on Sustainable Development and other relevant intergovernmental forums. Narrower:
Using tradable permitsUsing debt-for-nature swapsReinvesting in sustainabilityIntroducing environmental taxesResourcing biodiversity conservationImproving access of rural poor to creditEstablishing environmental investment fundsUsing debt-for-sustainable-development swapsAssisting in law-making on sustainable developmentAssessing financing costs of sustainable developmentFinancing provision of data on sustainable developmentEncouraging public investment in sustainable developmentReducing subsidies that undermine sustainable developmentEncouraging private sector investment in sustainable developmentFinancing environmentally sound technologies in developing countriesFinancing sustainable development by reducing incremental resource requirementsInvesting in environmentally benign hydropower Facilitated by:
Investing ethicallyInvesting appropriatelyDeveloping social bankingReducing fiscal inequalityRechannelling expenditure on defenceAllocating expenditure of public financesRecognizing micro-environments in farmingImplementing international commitments jointlyRestricting financial support for unsound developmentIncreasing accountability of international financial institutionsPublicizing services supporting sustainable production and consumptionImproving financial resources and mechanisms for sustainable developmentDeveloping investment strategies for national environmental action plansSupporting preparation and implementation of national programmes to reduce povertyCoordinating mobilization of domestic financial resources for sustainable developmentReviewing sustainability of policies of international agencies and finance institutions Organizations:
United Nations Environment Programme European Investment Bank References:
United Nations Centre for Human Settlements - UNCHS: Financing Cities for Sustainable Development: with specific reference to East AfricaEnvironmental Financial Advisory Board and Environmental Finance Center Network: A Guidebook of Financial Tools: Paying for sustainable environmental systems Subjects:
Commerce → FinanceDevelopment → Sustainable development
Type Classification:
C: Cross-sectoral strategies Related UN Sustainable Development Goals:
