Download This PaperSustainability Integration for Sovereign Debt Investors: Engaging with Countries on the SDGs
van Zanten, J. A., Sharma, B. & Christensen, M. (2021). Sustainability integration for sovereign debt investors: engaging with countries on the SDGs, Journal of Sustainable Finance & Investment, DOI: 10.1080/20430795.2021.1929806
20 Pages Posted: 26 Mar 2021 Last revised: 16 Jun 2021
Date Written: March 25, 2021
Abstract
Investors recently adopted a novel approach to sustainable investing: engaging with countries to advance sustainable development. But engaging with sovereign entities on sustainability challenges – such as those defined by the Sustainable Development Goals (SDGs) - is a complex endeavor. To guide sovereign debt investors in operationalizing this new sustainable investing strategy, this paper creates a framework that navigates the sovereign engagement process in a systematic manner. The framework answers three questions (i) who to engage with; (ii) what to engage on; and (iii) how to engage. First, relevant countries are identified based on the investor’s (public and private) investment exposure and the country’s progress on the SDGs. Second, using public data, SDGs and sub-targets are identified that face slow progress, thus being priorities to engage on. Third, a detailed roadmap is provided for orchestrating the engagement trajectory with the defined country on the selected SDG(s).
Keywords: Sustainable investing, active ownership, engagement, Sustainable Development Goals (SDGs), sustainable finance, sovereign debt, fixed income
JEL Classification: G18, G12, O16, M14
Suggested Citation: Suggested Citation