Can finance be put in the service of sustainability?
More can be done to put finance in the service of sustainable human development. Reforms of corporate law and the financial markets may be needed to ensure that investment will serve sustainable development and that the increasing financialization of the economy does not constitute an obstacle to reform.
The social economy, a sector representing 10 per cent of the EU economy and 6 per cent of total employment, may have a significant role to play in this regard. Encouraging steps are being made to build on this trend, such as the launch of the Social Business Initiative in 2011 to support the rapidly expanding social economy, the release in March 2013 of the European Commission's Green Paper on the long-term financing of the European economy; and the increased interest in socially responsible investment.
However, the debate continues on how to regulate the financial markets, how to reduce the corrosive impacts of speculation, and how to ensure that investors will adopt a longer-term view in their investment choices.
- How can the power of financial markets be put in the service of the sustainable development agenda?
- What could the contribution of the business community be to this new project?
- Which regulatory reforms are required to reconcile the increasing financialization of the economy with the need for a different form of sustainably-oriented investment in the longer term?
- What role can social impact bonds play in supporting the transition in the financial sector?
|Social Business Initiative. Creating a favourable climate for social enterprises, key stakeholders in the social economy and innovation, European Commission, Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions|
|European Commission website page on Long-term financing|
|'Socially responsible financial products European Economic and Social Committee, own-initiative opinion of the EESC, (CESE 759/2010)|
|Pour une économie positive, Rapport du groupe de réflexion présidé par Jacques Attali, Paris: La documentation française / Fayard, September 2013|
|Eurosif -- Developing Sustainability through European Financial Markets|
|European Network for the Promotion of the Social and Solidarity Economy, the European branch of the Reseau Intercontinental pour la Promotion de l'Economie Sociale et Solidaire (RIPESS Europe)|
Photo thanks to Aidas85