With a growing strain on natural resources, increasing climate change concerns and insufficient investment in green initiatives, the financing gap is more pressing than ever.
Green finance, the practice of making investments that have an inherent positive environmental impact, has gained traction within the financial industry as it allows investors to combine financial return with environmental benefit.
However, environmentally-conscious investments are needed on a much greater level if global ambitions such as the Paris Agreement, the UN Sustainable Development Goals and the recommendations of the G-20 Green Finance Study Group are to be met.
With an estimated $300 billion to $400 billion per year necessary to preserve healthy ecosystems, according to research by Credit Suisse, it is ever more evident that funds from both public and private sources are needed to address the pressing environmental needs.
Green finance encourages private sector investment into new and burgeoning areas such as green financial technology (fintech) and infrastructure, which generate economic return while working towards low carbon environments, adapting to climate change and promoting sustainable living.