This Blueprint seeks to define Sustainable Finance, and identify best practices for achieving this goal. Simply speaking, financial sustainability results from the creation of positive current and future value; more holistically, achieving sustainability through finance entails aggregate positive (or “regenerative”) impacts on social and ecological systems, many of which are currently on degenerative trajectories toward collapse.

Current “state of the art” ESG Integration (which assesses environmental, social and governance factors across all asset classes and investment strategies) moves in the right direction, but by definition falls short. “ESG does not, by nature, carry a true sustainability gene,” says Global Reporting Initiative Co-Founder Allen White, due to its focus on incremental progress. “Incrementalism alone, at the end of the day, is insufficient. Sustainability requires contextualization within thresholds. That’s what sustainability is all about.”

So, Sustainable Finance requires a systems-level approach that assesses sustainability thresholds (or the carrying capacities of the capitals) to create what’s called “system value” across financial, social and ecological systems in order to transcend the “predatory delay” of incrementalism.

This Blueprint sets out to identify existing mechanisms and trends, as well as recommending necessary developments and innovations, to transform finance into a regenerative model. It will focus on transcending existing shortcomings in the financial realm (systemic short-termism), as well as shortcomings in the social and environmental realms (endemic incrementalism.) The goal is to identify the “sweet spot” where long-term (“durable”) financial value creation converges with regeneration of social and ecological systems (“system value”).

The Blueprint will cover all three primary areas of finance: equity, debt (fixed income), and insurance.

• Reporting Blueprint: Redefine the purpose of finance; Integrate threshold-based success measurement; Activate scalability of sustainability through financial intermediation.
• Accounting Blueprint: Influence transformation of financial accounting to assess multi-capital, long-term system value creation
• Data Blueprint: Drive transformation of data market from incrementalist ESG focus to threshold-based sustainability focus
• New Business Models Blueprint: Leverage investor / financier influence to spur transformation to sustainable business models
• Transformation Journey Blueprint: Provide pathways of change that can be disseminated, piloted, and scaled through the Transformation Journey Program
• Funding Governance for Systemic Transformation Blueprint: This Blueprint questions how the funding fields transform itself in order to fund systemic transformation.