UN launches new coalition for chief financial officers, in bid to spur sustainable investment

Image: International Institute for Sustainable Development

Launched during UN Global Compact’s (UNGC) Annual Local Network Forum in Dubai, the new Chief Financial Officers’ Coalition for the Sustainable Development Goals (SDGs) will work to develop frameworks for ensuring that corporate finance is aligned with the SDG framework.

First launched in 2012 and formally adopted in 2015, the SDGs set out a vision for a world that is more socially and environmentally sustainable by 2030, covering all manner of issues relating to nature, climate change, waste, social equality and quality of living.

The UN believes that progress in almost every area covered by the SDGs is off-track either regionally or globally. The Covid-19 pandemic has resulted in backwards progress in several geographies on several goals, including goals relating to healthcare and education access in some of the least developed nations.

While funding from the UN and from national governments will go some way to delivering the SDGs, it has always been stated that the support of the private sector is necessary for their delivery. Some $5-7trn will be needed annually between now and 2030 to deliver the SDGs by UN estimates.

With this in mind, the new CFO Coalition for the SDGs will see CFOs collaborating with other experts to develop principles, frameworks and recommendations for the proper integration of SDGs into corporate financial plans.

It then aims to facilitate the widespread adoption of these approaches; there is an ambition to create a $10trn market for SDG-directed private finance by 2030, up from $500bn in 2020.

The new Coalition builds on UNGC’s existing work to develop a CFO Leadership Group. This 70-strong group launched in December 2019 and has already drawn up a set of ten principles for integrating the SDGs into individual investments and into overarching finance strategies. It is hoped that at least 30 more CFOs will join the Leadership Group by the end of 2022.

The Leadership Group’s co-chair, Alberto De Paoli, also CFO at energy major Enel Group, said: “With this new phase, we aim to engage thousands of CFOs to scale up our global community; this will play a critical role in mobilising trillions in corporate investments to close the financial gap needed to meet the SDGs and create sustainable shared value for all.”

“CFOs have a leading role to play in setting and aligning sustainability and financial targets,” added the UNGC’s senior advisor on sustainable finance Jerome Lavigne-Delville.

“This will not only help us secure a better future but it’s also good business — research increasingly shows companies who commit to sustainability targets regularly outperform those that do not. The CFO Coalition for the SDGs is at the vanguard of a new movement which recognises CFOs as the architects of long-term value creation.”

According to the World Economic Forum, just 0.2% of companies globally were classed as acting “strongly” in line with the SDGs as of last March. Despite top-level statements of support for the SDGs, and a boom in ESG investing, this would indicate that most businesses are yet to properly convert ambition into action.

Sarah George