Sustainable finance refers to financial activities that support sustainable economic growth while minimizing negative environmental impacts and promoting social well-being. An example of sustainable finance could be the issuance of "green bonds," which are debt securities issued by companies or governments to finance environmentally friendly projects such as renewable energy, energy efficiency, and sustainable agriculture.
Another example of sustainable finance is socially responsible investing (SRI), which involves investing in companies that adhere to specific environmental, social, and governance (ESG) criteria. SRI considers factors such as a company's carbon footprint, human rights practices, and diversity and inclusion policies.
Sustainable finance can also include financing for projects that promote social well-being, such as affordable housing or access to healthcare and education. The key is that these financial activities are aligned with sustainable development goals and have a positive impact on society and the environment while generating financial returns for investors.
The ESG space is changing day by day, creating more uncertainty for decision makers
