The report finds that even with strong real economy policies to correct market failures and deploy public capital, some interventions in the financial system will be needed to realise sustainability ambitions.
Countries are developing policy innovations to improve the sustainability performance of the financial system. These include:
• CHINA A system-wide focus on green finance is taking shape, involving banking, insurance and capital markets.
• BRAZIL New central bank requirements on environmental and social risk in the banking sector have evolved out of a long national dialogue.
• EUROPEAN UNION The traditional focus on disclosure is moving onto the critical question of mobilizing long-term capital for a sustainable recovery.
• USA New research on the economic risks of climate change provides extra impetus to make disclosure on sustainability factors routine in capital markets.
The report concludes with thoughts on how the international momentum for further financial policy innovation is set to intensify in 2015.
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