ACTIONS: Given the complex and ambitious set of transformations needed to deliver on the 2030 Agenda, coherence across policy areas is critical. There is a growing understanding of how financial regulations are affecting incentives for sustainable development investment. There is less understanding of the impacts of social and environmental risks on credit quality and the stability of the financial system. Policies and regulations need to act together in order to create a sustainable financial system. The regulatory system needs to be congruent with the measures used to boost the sustainability of the private financial system, such as sustainability reporting and impact measurement. Well-run national development banks can help countries develop financing options for Sustainable Development Goal-related investments. Such banks should be aligned with the Goals in a holistic way and be considered in integrated national financing frameworks. Collaboration between national development banks and multilateral banks, through co-financing or on-lending arrangements, can enhance Goal-related finance through the complementarity of international resources and local market knowledge. EVENT: On December 4th, a high-level meeting to mark the International Day of Bank 2024 will be held at the United Nations Headquarters in New York, Join the International Day of Banks observance!
FORUM: "Address the systemic economic and financial risks and architectural gaps that threaten the implementation of the 2030 Agenda." International Day of Banks 2022.
The banking sector plays an important role in achieving the 2030 Agenda due to its capacity to provide and channel resources towards sustainable initiatives that contribute to the implementation of the SDGs. To achieve this goal, most banks are identifying ways in which their activities can contribute to delivering the global sustainable development agenda, with about half of survey respondents reporting the use of indicators and targets aligned with the SDGs.
Sustainable-focused products have high potential as a source of SDG financing. 63.3% of banks surveyed in the study have already launched products, services or commercial initiatives based on the SDGs. For bank customers, these mostly include bonds and investment funds aligned with the SDGs. At the retail level, banks are developing products and services that promote a transition to a low-carbon economy, ranging from green mortgages to loans for the purchase of eco-friendly vehicles. Some products also promote other topics such as entrepreneurship or gender equality.
Establishing sustainable financing frameworks also enables the banks to identify activities that can channel funding into projects aligned with the SDGs. In terms of portfolio evaluation to measure alignment with the SDGs, progress has thus far been uneven, with most banks reporting that little headway has been made in integrating these aspects into the business. The same trend is observed in terms of defining objectives and metrics suitable for monitoring. According to the study, this is largely motivated by the lack of a methodology to facilitate these tasks, and by the need to engage in strategic business thinking that considers SDGs from the initial stage.
Recognize the role of National and regional development banks during financial crises when private sector entities become highly risk-averse.
Call on Governments to revisit their labour market policies, social protection systems, fiscal policies, competition policies, trade policies and financial sector regulations and strategies to ensure that they are in line with the new realities.
Call upon national and regional development banks to expand their contributions in areas such as sustainable infrastructure, energy, agriculture, industrialization, science, technology, and innovation, as well as financial inclusion and financing of micro, small and medium-sized enterprises
Ensure that financial and economic systems are coherent with sustainable development
Demonstrate how the well-functioning national and regional development banks can play in financing sustainable development
Urge relevant international public and private actors to support such banks in developing countries.
Develop Integrated financing frameworks to respond to financing challenges.
The process for banking supervision can be envisaged as a cycle:regulation and supervisory policies provide the foundation for the development of supervisory methodologies and standards, which underpin day-to-day supervisory activities Lessons learned in the course of supervision and through regular quality checks are used to improve this processs.
The future of banking will look very different from today. Faced with changing consumer expectations, emerging technologies, and new business models, banks will need to start putting strategies in place now to help them prepare for banking in 2030. Explore eight key trends below that are changing the banking landscape.
How can you drive bold transformation in your organization over the next 10 years? Learn how our holistic, integrated solutions can help you address the challenges and maximize the opportunities of the next-generation bank.
The 2022 Financing for Sustainable Development Report: Bridging the Finance Divide finds that while rich countries were able to support their pandemic recovery with record sums borrowed at ultra-low interest rates, the poorest countries spent billions servicing debt, preventing them from investing in sustainable development. The pandemic shock plunged 77 million more people into extreme poverty in 2021, and by the end of the year many economies remained below pre-2019 levels. The report estimates that in 1 in 5 developing countries’ GDP per capita would not return to 2019 levels by the end of 2023, even before absorbing the impacts of the Ukraine war.
Successive crises including COVID-19, Russia’s war of aggression against Ukraine and the climate emergency are exacerbating inequalities between and within countries and stifling progress to achieve the Sustainable Development Goals (SDGs) and the Paris Agreement. While developed countries deployed historic stimulus packages to build back better, developing countries lacked fiscal and monetary buffers to respond. Countries with the fewest resources face challenging trade-offs between short-term rescue and long-term financing for a sustainable recovery. The SDG financing gap in developing countries grew due to a drop in available resources called upon in the Addis Ababa Action Agenda coupled with rising financing needs. Official Development Assistance (ODA), or aid, played an important role to help narrow the gap, but could not do so on its own. Global crises open a window of opportunity for SDG alignment of broader resources to narrow the gap. Growing trillions in developed countries aim to reduce risks, including environmental, social, and governance (ESG) criteria. However, resources are not reaching the countries most in need. Urgent action is needed to remove bottlenecks for a more equitable and needs-based allocation of sustainable finance.
A NEW WAY TO INVEST FOR PEOPLE AND PLANET. The Global Outlook on Financing for Sustainable Development 2021 calls for collective action to address both the short-term collapse in resources of developing countries as well as long-term strategies to build back better following the outbreak of the COVID-19 pandemic. The financing gap to achieve the Sustainable Development Goals (SDGs) in developing countries was estimated at several trillions of dollars annually before the pandemic. The report demonstrates that progress to leave no one behind has since reversed, and the international community faces unprecedented challenges to implement the holistic financing strategy set out in the Addis Ababa Action Agenda (AAAA). The report finds that trillions of dollars in financial assets held by asset managers, banks and institutional investors are contributing to inequalities and unsustainable practices. It highlights the need to enhance the quality of financing through better incentives, accountability and transparency mechanisms, integrating the long-term risks of climate change, global health, and other non-financial factors into investment decisions. The report concludes with a plan of action for all actors to work jointly to reduce market failures in the global financial system and to seize opportunities to align financing in support of the 2030 Agenda for sustainable development.
17 Apr 2013 - Ahead of talks with the World Bank, UN Secretary-General Ban Ki-moon briefed the press at UN Headquarters.
Ahead of talks with World Bank, Ban briefs press at UN Headquarters
World Bank Headquarters, Washington DC.
Photo: World Bank/Simone D. McCourte
Secretary-General Ban Ki-moon briefed correspondents in New York today on a range of issues before beginning two days of top-level meetings in Washington tomorrow aimed at stepping up cooperation between the United Nations and the World Bank, the institution dedicated to providing financial and technical aid to developing countries around the world.
The talks with the World Bank will focus on four main areas, he said – education, climate change and sustainable energy, poverty, and the role of development banks.
“First is education: one of the smartest investments we can make in the world’s future well-being,” Mr. Ban said, while calling the second issue, climate change and sustainable energy, a crisis in the making, with sustainable energy a major part of any solution.
On poverty, he noted that “remarkable progress” has been achieved towards attaining the anti-poverty Millennium Development Goals (MDGs) by their target date of 2015 but much remains to do be done in the final 1,000-day lap “and we must make this period one of action.”
The MDGs, adopted by the UN Millennium Summit of 2000, seek to slash a host of social evils, including extreme poverty and hunger, diseases and lack of access to health care and universal primary education, all by 2015.
On the development, Mr. Ban noted that for the first time he will be meeting meet the heads of all the world’s leading development banks “to strengthen our partnership on financing and in the key area of statistics.”
He noted that his meetings will coincide with the spring meetings of the World Bank and the International Monetary Fund with presidents, prime ministers, finance ministers and others in attendance “that we hope to turn into high-level political support for the Millennium Development Goals.”
Mr. Ban will be accompanied by Deputy Secretary-General Jan Eliasson who “will use his time to highlight the crucial issues of sanitation and the rule of law.”
The 188-member country World Bank, established in 1944 and headquartered in Washington, comprises two institutions managed by 188 member countries: the International Bank for Reconstruction and Development (IBRD) and the International Development Association (IDA).
The IBRD aims to reduce poverty in middle-income and creditworthy poorer countries, while IDA focuses exclusively on the world’s poorest countries.
