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25 Sep, 2018

Leaders Call for New Global Architecture for Sustainable Markets at World Economic Forum Summit

Geneva and New York, 24 September 2018 (WEF media release) – The World Economic Forum’s second annual Sustainable Development Impact Summit opened in New York City with a call for government, business and civil society leaders to scale up proven initiatives to build sustainable global markets.  “The thinking has been done. Now is the time to implement,” Klaus Schwab, Founder and Executive Chairman, World Economic Forum, told participants at the Opening Plenary. “The World Economic Forum will be committed to provide its platform, on a very grassroots level, to shape a new global architecture for tomorrow,” he added.

Over 800 leaders from government, business and civil society are taking part in the summit to work towards achieving the United Nation’s Sustainable Development Goals. A number of them called for new global architecture for sustainable markets; citing multiple initiatives to build it. Only public-private collaboration can break down barriers to sustainable growth, which also requires shifting of investments from fossil fuels to renewables, unifying sustainability standards and metrics, and government and businesses publically setting sustainability goals.

Bill de Blasio, Mayor, New York City, urged other cities to follow New York’s example, commit to the sustainable development goals and set benchmarks to ensure accountability. “We believe the best way is to put our goals out publically so that the public will hold our feet to the fire,” he said. Among other measures in New York to boost sustainability, de Blasio told participants how the city’s pension funds have recently divested from fossil fuels and committed to investing 2% of assets – over $4 billion – in renewable energies and other climate change solutions. He urged all investors to do the same. “Put your money in the technologies that will save us all,” he said.

Barbara Novick, Vice-Chairman, BlackRock, gave examples of steps towards sustainability that businesses and investors have taken in recent years. The UN’s Principles for Responsible Investment (PRI), for example, now cover over $60 trillion in assets. However, she expressed concern about an “alphabet soup” of competing standards and initiatives and called for governments to work with the private sector and civil society to unify some of these standards. Novick also noted the importance of individual investors in fostering sustainable investment strategies. “The preference of clients is critical to whether more assets will be allocated to this sector,” she said, predicting that “as more and more millennials become empowered, the trend of sustainable investment will accelerate.”

Scandinavian countries can serve as a model, said Lars Løkke Rasmussen, Prime Minister of Denmark. They have successfully distributed globalization’s benefits among their populations and have fostered cross-sector collaboration on sustainable markets. “We have decoupled emissions and economic growth by consensus, establishing partnerships between civil society, academics, business and politicians,” Rasmussen said. “By matching private and public sectors in partnership, we can break down barriers to sustainable growth, which no sector can do on its own.”

“You’ve got to change your business model,” David MacLennan, Chairman and Chief Executive Officer, Cargill, told leaders. “You can’t do it the same old way. Look at where we are on climate change.” He called for three steps to make global food markets more sustainable: encouraging free trade; incentivizing private-sector investment in agriculture; and offering farmers training, technology and incentives to practise sustainable agriculture.

Winnie Byanyima, Executive Director, Oxfam International, highlighted the growth in global inequality that has continued since the global financial crisis 10 years ago. “Most people don’t feel that the world includes them,” she said. “This crisis is a crisis of economic inequality.” She urged governments to create incentives for businesses to share profits with all their stakeholders, not just shareholders, to crack down on lobbying and to increase corporate taxation to fund spending on education and healthcare.

Børge Brende, President, World Economic Forum, noted that the ambitious scope of the Sustainable Development Goals requires more than changes at the margins. “We can’t achieve them [SDGs] through the status quo or just some extra development assistance,” he said. “We will need a shift in models.”

The World Economic Forum, the International Organization for Public-Private Cooperation, hosts its second Sustainable Development Impact Summit in New York on 24-25 September to drive solutions for the 2030 Agenda for Sustainable Development and Paris Agreement on climate change.