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Cambridge Institute for Sustainability Leadership

Centre for Sustainable Finance

 

A ‘quiet revolution’ is underway in the global financial system as its leaders wrestle with the implications of global sustainability. Expectations from clients and regulators are climbing steadily, causing financial institutions to rethink current operating practices, and adopt longer term, more forward-thinking strategies. This trend is set to continue as sustainability issues translate into ever more substantive risks and opportunities.

Through a unique combination of deep industry collaboration, high-calibre research, and exceptional education programmes, the Centre for Sustainable Finance is helping financial institutions to play a leading role in building a more sustainable economy.

to find out more.

 

Collaboration


Working with over 50 global financial institutions across banking, insurance and investment, we provide the insight needed to challenge current assumptions and lead change.

ClimateWise (global insurance)

ClimateWise comprises 33 leading insurers, reinsurers, brokers and industry service providers who share a commitment to reducing the impact of climate change on society, as well as the insurance industry.

Banking Environment Initiative

Some of the world’s largest banks working to lead their industry in directing capital towards environmentally and socially sustainable economic development.

Leading investment managers and asset owners with over £15 trillion under management working to help shift the investment chain towards responsible, long-term value creation.

Interaction with policy

The Centre bridges the worlds of business, finance and policymaking in order to enable the transition to a sustainable economy, facilitating stronger mutual understanding between financial institutions, their clients in the real economy and the institutions which govern them. For example, the Centre is academic visitor at the Bank of England helping to support its work in leading the sustainable finance agenda. It has worked with De Nederlandsche Bank (DNB) on the financial impact of disruptive energy transition, collaborated with the South African National Treasury and Banco de Mexico on embedding environmental scenarios into financial risk frameworks and was the knowledge partner for the G20 Green Finance Study Group in 2016 and 2017. Finally, as a founding member of the Global Research Alliance for Sustainable Finance and Investment, the Centre is an official research stakeholder for the Network for Greening the Financial System

 

Research


We have a particular reputation for translating high-quality research into practical solutions to advance both policy and market practices.

Risk and resilience

Embedding resilience to environmental risk in routine financing decisions. This includes the Centre’s work with banks and asset managers to identify and assess the financial risks of nature loss.

Positive impact

Enabling investors to achieve positive impact against the Sustainable Development Goals.

Harnessing the digital revolution and financial innovation to direct capital to sustainable business models.

Research hub for sustainability 

Our research is intended to strengthen the impact of business, government and financial institutions by informing their transition to a sustainable economy.

 

Current research

The Centre conducts research on mainstreaming environmental and social scenarios into financial risk analysis; measuring ‘asset stranding’ effects under future technology transitions; understanding the role of the financial system in financing a sustainable, zero carbon economy; science-based measures to quantify non-financial outcomes of investment; innovative financing of sustainable infrastructure; and consumer demand for sustainable investment funds.

Our research is intended to strengthen the impact of business, government and financial institutions by informing their transition to a sustainable economy, herein defined as a net zero, circular, restorative economy within an inclusive, resilient society exhibiting high levels of social and environmental justice. As part of our commitment to enacting real-world change, we have identified five ‘applications in practice’ which drive research at CISL:

  • Future risk and opportunity - A better understanding of sustainability risks allows companies to convert them into opportunities.
  • Business strategies and models - Sustainable business models enable companies to go beyond financial success into purposeful impact on society.
  • Measures, targets and disclosure - Key to trust is transparency, and sustainability provides the perfect performance framework.
  • Culture, capacity and leadership - Seeing problems differently demands leadership, yet this is exactly what companies must do to become agents of positive change.
  • Social and political change - Companies can use their influence to drive sustainability, aligning their ambitions with long-term value creation for society.

 

Zero carbon

 

Circular economy 

 

Protection of nature

 

Inclusive and resilient societies

 

Education and advisory


Financial institutions increasingly recognise the benefits of aligning their commercial strategy with the sustainable economy. Leading organisations, especially banks and insurers, are already seeking new financing opportunities, engaging clients to develop new products, and developing new policies and metrics to understand the implications of sustainability.

Despite this realisation, many senior decision-makers are struggling to respond. Board and executive team members often lack the relevant knowledge about how quickly sustainability issues are changing. Senior client, portfolio and product leaders are often unaware of emerging commercial opportunities from new technologies or the risks associated with supporting traditional industries. Many organisations are struggling to develop clear, long-term positions to finance the transition of key sectors such as transportation, energy and agriculture.

Our education programmes are designed to bring rigour, clarity and confidence for leaders to respond.

Find out how we can help your organisation.

 

Recent sustainable finance publications


Understanding the climate performance of investment funds

29 July 2021

29 July 2021 – Understanding the climate performance of investment funds should be made simple to all investors. Analysis from CISL’s Investment Leaders Group (ILG) found that the present disclosure of fund performance does not allow investors to understand and compare the alignment of funds with the Paris Agreement on climate change. The latest reports from the group now provides a tour of the assumptions and approaches behind existing methods, and introduces a simple and transparent disclosure method that enables investment managers to report the alignment of their portfolios with the Paris ambition.

CISL’s Centre for Sustainable Finance responds to EU sustainable finance strategy

6 July 2021

6 July 2021 - The EU Commission today presented its new Sustainable Finance Package which includes plans to bring financial institutions along on its goal to create a carbon neutral continent by 2050. CISL and its finance leadership groups across banking, insurance and investment respond to the new strategy.

Handbook for Nature-related Financial Risks: Key concepts and a framework for identification

6 July 2021

1 March 2021 – The University of Cambridge Institute for Sustainability Leadership (CISL) has published a handbook for understanding and identifying nature-related financial risks.

Climate product innovation within the insurance sector

30 June 2021

30 June 2021 – The University of Cambridge Institute for Sustainability Leadership’s (CISL) ClimateWise initiative has published a new white paper on climate product innovation.

Centre for Sustainable Finance

4 June 2021

Nick Villiers, Director of Sustainable Finance Nick leads the Centre for Sustainable Finance, which helps financial institutions play a leading role in building a more sustainable economy. Prior to joining CISL in September 2019, Nick spent 18 years in investment banking working in Debt Capital...

Let’s Discuss Climate: The essential guide to bank-client engagement

5 May 2021

The University of Cambridge Institute for Sustainability Leadership’s (CISL) Banking Environment Initiative has published a new guide to bank-client engagement, which aims to address the need for a market-wide transformation in how banks and their corporate clients interact.

Investing in the age of climate transitions: The case for universal disclosure of Paris alignment by investment funds

11 April 2021

28 April 2021 – Understanding the climate performance of investment funds should be made simple to all investors. Lucy Auden, Senior Programme Manager for the Investment Leaders Group (ILG), analyses the current approaches to measuring fund climate performance and makes the case for a universal disclosure of Paris alignment. This analysis will be followed by a report in summer 2021 which proposes a disclosure methodology and explores the underpinning science, methods of emissions projection, and distribution of carbon budgets used by current approaches.

New action plan for banks to halt deforestation unveiled by University of Cambridge Institute for Sustainability Leadership

6 January 2021

12 January 2021 – A new report outlines how banks can take steps to accelerate the reduction and reversal of deforestation leading to greater stability for nature, climate and the economy.

Banking beyond deforestation

6 January 2021

January 2021 – The University of Cambridge Institute for Sustainability Leadership (CISL) has published a new report detailing how the banking industry can contribute to halting and reversing deforestation.

‘Good step forward for climate action’ – Cambridge Institute for Sustainability Leadership responds to Prime Minister's Ten Point Plan 

18 November 2020

18 November 2020 – Prime Minister Boris Johnson released details of his Ten Point Plan for a UK green recovery yesterday evening. The roadmap towards decarbonisation of the economy and regeneration of nature comes one year before the UK hosts the COP26 climate summit.

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Achieving Zero hub

Nature-Positive hub

Media highlight

Dr Nina Seega and CISL Senior Associate Steve Waygood discuss the connection between investments and the health of the planet with BBC ideas.

CISL's independent research

Strengthening the case for action to build a sustainable economy

Read more

Sustainable Finance 8-week online course

Learn to lead and develop sustainable finance strategies and positive outcomes.

Learn more

Contact

If you are a potential research partner, funder or could shape and use the Centre’s outputs, please use this contact form to start the conversation.

Rewiring the Economy

The Centre contributes directly to CISL’s Rewiring the Economy plan.Read more