The Sustainable Development Goals and the Market for Sustainable Sovereign Investments

Abstract

Sustainable finance represents a tremendous occasion for institutional investors globally, especially in lower-middle to low-income countries. For instance, in these country groups the share of global energy investment was 14% for a population representing a share of 42% of the total. Sovereign wealth funds (SWFs) are well positioned to join these opportunities given their hybrid nature, as government-owned entities with a market orientation, and due to the inherent long-term nature of ESG goals. Their characteristics allow SWFs to efficiently mobilize resources to obtain both financial returns and a positive environmental impact.

Keywords: sovereign wealth, SWF, sustainable development, SDGs, Paris Agreement, ESG, sustainable finance, green finance