Quiet financial revolution nurtures green growth

The global economy is in transition. Anywhere you look in the world, you can see this. From private companies embracing clean technology and clean energy, to countries putting sustainable growth at the center of national planning, the drive is toward inclusivity and the green－both are urgently needed.

Such changes have been heralded both by the Paris Agreement on climate change and the adoption of the United Nation's 2030 Agenda for Sustainable Development last year. These are superb ambitions and the right direction for our future.

That is why the G20's core objective of sustainable growth can only be achieved by aligning policy with these ambitions.

As we watch the change play out and help it quicken, we see that it is driven by forward-looking countries and businesses. But a piece of the puzzle is still missing.

What is missing is the effective service of the global financial system. We need trillions of dollars of investment to both fix what we've done to our planet and to eradicate extreme poverty. We need this investment for a future where we are not blighted by climate shocks, failing ecosystems and widespread instability. To unlock that investment, we must reshape the financial system.

Many leaders in the financial system have long understood this. And many over time have made attempts at new financial products and business models to help meet the need. Despite some exemplary progress, however, there is a long way to go in overcoming backward-looking interests and policy and regulatory frameworks insensitive to what is needed to secure an effective, efficient and resilient financial system.

But there is something brewing. A quiet revolution has been underway in recent years. Bold policymakers, regulators, investors, bankers and insurers, often from developing countries, have been experimenting with new methods and measures to build the financial system we need for a sustainable future.

This "quiet revolution" was first chronicled in a UN Environment Programme report called "The Financial System We Need" in 2015. What we found was remarkable: an unprecedented rise of policy and market innovations independently taking place around the world, from Bangladesh to Brazil, and from France to Kenya.