QUIET REVOLUTION A LOOK AT CHAPTER 2 IN THE PUBLICATION FROM UNEP ON “THE FINANCIAL SYSTEM WE NEED” WHICH YOU CAN READ HERE
The Inquiry’s core finding is that there is a “quiet revolution” seeking to integrate sustainable development into the fabric of the financial system. The Inquiry found over 100 examples of policy measures across 40 countries targeting each of the main asset pools and actors, as well as the underlying governance of the financial system.
Developing and emerging economies are leading this revolution, driven by a focus on economic transformation, social inclusion and local environmental priorities. Champions are also emerging in the developed world, driven more by market efficiency and stability concerns, and in response to global risks such as climate change.
International cooperation is growing rapidly, catalyzing learning and shared approaches.
The quiet revolution is being led by those governing the financial system, often in collaboration with market actors. Innovative measures are being advanced by central banks, financial regulators and standard setters including credit rating agencies and stock exchanges.
Measures taken vary widely:
¥ Nationally, from South Africa’s leadership in embedding sustainable development into listing requirements, to Brazil’s banking regulations governing environmental risk, Bangladesh’s central bank refinancing to support green investment, China’s leadership in advancing green credit guidelines and the Bank of England’s prudential review of climate risk.
¥ Internationally, from principles-based coalitions such as the Sustainable Banking Network for Regulatory and the Sustainable Stock Exchange Initiative, to S&P Rating Services’ climate-sensitized sovereign credit ratings, and the Financial Stability Board’s consideration of the role of central banks in addressing climate-related risks.
Integrating sustainable development into the evolution of financial systems provides both short and long-term potential benefits.
In the short to medium term:
¥ Developing countries have the opportunity to increase financial access, reduce environmental pollution with associated improvements in public health, and improve financial flows to clean energy and other new sources of economic development.
¥ Developed countries have opportunities for improving market integrity, aligning the financial sector more closely to the real economy, enhancing financial and monetary resilience, and addressing policy goals such as financing the energy transition.
At stake is the potential to shape a financial system fit for the 21st century. The longer-term opportunity for both developed and developing economies is to evolve efficient financial systems that are more effective in serving the needs of inclusive, sustainable economies and societies. Measures identified by the Inquiry, taken one by one, are unlikely to protect society from other financial system weaknesses that enable mispricing, rent-taking and instability.
However, the cumulative impacts of such measures can be more than the sum of their parts. Implemented with ambition and engagement, they can trigger broader, system-level shifts.
I WANT TO COMMENT ON THIS AND I WANT TO SAY THAT I UNDERSTAND THE MOTIVES BEHIND THIS PLAN. IT IS VERY CLEAR TO ME THAT OUR CURRENT SYSTEM IS BROKEN AND SOMETHING NEW HAS TO COME INTO PLAY SOON. I ALSO UNDERSTAND THAT THE PRIVATE CAPITAL NEEDED TO MAKE THE CHANGE FROM THE SYSTEM WE HAVE NOW TO THE SYSTEM WE NEED IS PRIMARILY FOR PRESERVATION OF THAT WEALTH AND THE BENEFITS THAT WILL COME TO EMERGING ECONOMIES ARE BORN OUT OF OPPORTUNITY OF PRESERVING THE PRIVATE CAPITAL.
WE NEED TO UNDERSTAND THE SYSTEM IS BROKE AND THE VERY WEALTH THAT BROKE ARE NOW GOING TO INTRODUCE SOMETHING NEW AND PRETEND THEIR MOTIVES ARE PURE. I GET IT AND I WANT YOU TO GET IT TOO.
NOW IF WE WANT TO GET ALL UP ON MORAL GROUND THAN I ASK YOU WHAT IS THE ALTERNATIVE? LET IT ALL GO TO HELL IN A HAND BASKET? WE KNOW THAT WILL NEVER BE ALLOWED SO LET’S COME UP WITH THE NEXT BEST THING. THE FINANCIAL ARCHITECT’S CAN NOT LET ON THAT THEY BROKE THE SYSTEM WITH ALL THEIR SHENANIGANS SO INSTEAD THEY ARE GOING TO MAKE IT SEEM THAT THEY HAVE COME UP WITH SOMETHING NEW AND SHINY, BUT WE KNOW THE TRUTH.
ALL OF THIS GREEN FINANCE AND PARIS AGREEMENT AND GLOBAL RE-ALIGNING IS PRETTY SELF SERVING FOR THE ARCHITECT’S BUT GUESS WHAT THERE ARE BENEFITS FOR MANY FROM THIS DEVELOPING OF A SUSTAINABLE FINANCIAL SYSTEM. THIS IS WHAT INTRIGUES ME.
WE SHOULD LOOK AT GREEN FINANCE AND PARIS AGREEMENT, GLOBAL RE-ALIGNING AS A TOOL, A TOOL TO UNLOCK THE TRILLIONS OF PRIVATE CAPITAL THAT IS SITTING IDLE. EMERGING NATIONS HAVE A GREAT NEED AND PUBLIC FINANCE IS VERY SHORT BUT PRIVATE CAPITAL IS VERY LARGE AND THAT CAPITAL IS UNABLE TO FIND A LONG TERM SAFE HAVEN TO PARK IN AND YIELD SOME RETURN. SO GUESS WHAT THE CHOCOLATE IS MERGING WITH THE PEANUT BUTTER AND SOMETHING DELICIOUS IS BEING CREATED.
THAT CREATION WILL BENEFIT POOR COUNTRIES AND THAT CREATION WILL CREATE INFRASTRUCTURE IN THE POOREST OF COUNTRIES AND THAT CREATION WILL PROVIDE WATER AND FOOD AND BASIC NECESSITIES OF LIFE TO COUNTRIES THAT DO NOT HAVE THAT, AND ALL WILL BENEFIT.
FOR ANYONE SAYING THAT THERE ARE COUNTRIES FIGHTING THE PARIS AGREEMENT I SAY RESPECTFULLY YOU ARE VERY WRONG. AND WHY WOULD THEY WANT TO?? IF ONE BANKING SYSTEM FAILS THEY ALL DO. SO THIS IS THE WAY TO FIX ALL OF THAT. DO YOU UNDERSTAND NOW??
LET’S LOOK A LITTLE CLOSER OK.
The financial system underpins growth and development. In 2008 we witnessed some of the world’s most sophisticated financial systems spawn the worst global financial crisis seen in decades. As markets in some developed countries collapsed, others in both developed and developing nations were inevitably dragged down. In the wake of this global financial crisis, recognition has grown that the financial system must be not only sound and stable, but also sustainable in the way it enables the transition to a low-carbon, green economy. Therefore to achieve the sustainable development we want will require a realignment of the financial system with the goals of sustainable development.
Aligning the financial system for sustainability is not some far-off notion, but is already happening. A “quiet revolution” is taking place as policy makers and financial regulators address the need to forge robust and sustainable financial systems for 21st century needs. Concepts such as natural wealth and the circular, green economy have moved from the margins to become the substance of economic strategies and policies for businesses and nations. Clean energy will underpin tomorrow’s global energy system and there is little doubt that the challenge, although considerable, is essentially one of transition.
THIS IS A VERY TRUE STATEMENT AND THE QUIET REVOLUTION IS REALLY VERY QUIET BECAUSE NOT TOO MANY PEOPLE UNDERSTAND WHAT’S HAPPENING OR WHY, BUT WE ARE OUT IN FRONT OF THIS CURVE AGAIN WITH SOLID UNDERSTANDING.
THERE ARE NO BLIND SPOTS IN OUR UNDERSTANDING OF MODERN MONEY MECHANICS. WE SEE THINGS VERY CLEARLY AND CHOOSE TO SEE THIS AS GOOD MOVEMENT ESPECIALLY WHEN YOU CONSIDER THE DOOMSDAY ALTERNATIVE OF THE CURRENT BANKING SYSTEM FAILING WITH NO SAFETY NET IN PLACE.
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