The Path to Financing Sustainable Development

In a world that has sizable infrastructure, the challenge is in how to meet the significant capital needs and to ensure that the development is done sustainably. A two-part presentation in the Goal 17 Partner space addressed the issue. In the first part, a moderated “fireside chat,” Scott Minerd, Chairman of Investments and Global Chief Investment Officer of Guggenheim Partners, and Carter Roberts, President and CEO of the World Wildlife Fund in the United States, discussed the vision and progress to date of the Guggenheim-WWF partnership to bring greater private sector capital to achieving the United Nations’ SDGs.

Minerd spoke to the imperative, opportunity, and risks of meeting the infrastructure needs of the worl going forward. “Infrastructure will be a big investment opportunity in the future….but the responsibility we have as investors is to try to do this right. The consequences of making a mistake will be huge. We will get there because we have to get there.”

Roberts’ goal in advancing sustainable development goals was getting the WWF and other organizations involved at a project’s outset, where they can have a greater impact. “Typically the NGOs get brought in after the blueprints have been done and after the deal has been struck and we are left to try and minimize the damage way downstream from where the investment decisions are made. And so the idea is to move upstream with the right kind of data and people, with governments and businesses so that they make smarter choices.”

The second part of the presentation was a panel discussion that focused on the report by the Stanford Global Projects Center, “State of Practice: Sustainability Standards for Infrastructure Investors.” The Stanford Study, commissioned by Guggenheim and WWF, identifies and analyzes the various metrics used to assess the sustainability of infrastructure investments. The panelists advanced the discussion that was started by Minerd and Roberts, and focused on the need for common standards of measuring and assessing sustainable development projects.

Daniel Wiener, president of the board, Global Infrastructure Basel, was optimistic. “Two-thirds of the infrastructure that will be in place by 2050 doesn’t exist today. This is a huge opportunity. In order to achieve the Sustainable Development Goals we will have to triple the infrastructure……[this could] destroy our ecosphere. Standards that include sustainability and resilience do that.”

Looking to move sustainable development beyond the “do no harm” phase, David McCauley, WWF senior vice president for Global Partnerships and Multilateral Engagement, talked about the next step on the journey to a more comprehensive approach to sustainable development. “How can we proactively design a future that respects all of the values that come from healthy ecosystems. You can’t do it project by project. We need to have a broad-based modeling and projections and you need a policy framework.”

Jim Pass, senior managing director at head of project finance at Guggenheim, explained the rationale for the Stanford Study, and how it relates to his panelists challenges. “There are several standards and companies, but they are not coming together….What we have done with the partnership with the WWF and when we reached out to Stanford was to assess all the different standards that are out there. What we would like to do next is identify four different projects at different stages and really design where this road will go. The key to this is working to try and identify how we make these standards acceptable to institutional investors, to pick the best and brightest that will be the key to open up the doors for private capital.”