The financial sector, with its vast resources and risk management experience, should be at the center of the fight against climate change. This statement belongs to Citigroup CEO Michael Corbat, and it was from this that the participants of the Executive MBA began their discussion on green capital — an additional ecosystem of global finance. Currently, EMBA-38 participants are studying the modern system, processes, and trends of global finance (in the course of the same name); among the hot topics of global finance are naturally green finance.

The executive director of one of the largest international financial conglomerates is right: climate challenges require substantial changes in the global finance system. Yevhen Volkovskyi — visiting professor at kmbs — noted: "Since public sector funds are insufficient to achieve sustainable development goals, today the financial sector is something of a locomotive for the implementation of this task."

In the presentation considered by kmbs participants, it was consistently emphasized that a green "great reset" is possible with a comprehensive approach:

Inclusion of non-financial risks in investment decision-making processes.
Introduction of green financial instruments.
Implementation of national strategic documents.

The presentation on green capital for EMBA-38 was conducted by experts in the field of climate finance, who, in particular, founded the Center for Blended Value Studies in 2015, providing sustainable development consulting. Doctor of Economic Sciences, coordinator of the UNDP energy and environmental protection project group Oleksandr Sushchenko and Candidate of Economic Sciences, Associate Professor at Kyiv National Economic University Yevhen Volkovskyi focused in more detail on two aspects of sustainable development finance. Namely: non-financial risks and green finance instruments.

The European Green Deal with the goal of "2 degrees Celsius" is reflected in quite real figures regarding investments by 2050: $100 trillion for the world, $450-560 billion for Ukraine; such figures were announced at the presentation. Thus, ecology is turning into financial reality, the financial market sees development prospects precisely in the green market and takes advantage of this opportunity.

Climate change counteraction instruments are usually divided into two groups and two corresponding approaches: 1. Fiscal instruments (here: environmental and energy taxes) and 2. Market instruments (here: the system of trading greenhouse gas emission permits). Among the innovative market instruments today are green certificates, green bonds, sustainable development bonds, catastrophe bonds and swaps, and economic impact bonds.

"There is enough money for everyone to go green," predicts Oleksandr Sushchenko. The general goals recorded in the Sustainable Development Declaration are implemented in specific companies through a risk assessment system, that is, through a list of indicators by which the financial market evaluates itself and its clients. Financial institutions are required to analyze ESG risks, as banks are interested in the development of green financing, interested not only in the interest they receive but also in additional assets. Only greenhouse gas emission certificates constitute a market that is currently growing at a high pace.

Currently, in Ukraine, in the field of green finance, the issue of taxonomy of sustainable development projects and the related access to information on non-financial risks is timely. And in connection with this — the increasingly acute problem of qualified personnel and uncoordinated actions at the level of ministry powers. Meanwhile, Oleksandr Sushchenko is convinced: "The pandemic will end, then the economy will need a stimulus for growth. The financial crisis of 2008 showed that governments of different countries and large companies in overcoming the crisis are taking steps towards a green future. The current crisis exists under the same conditions. Recovery in all countries is green."

Oleksandr Sushchenko and Yevhen Volkovskyi — on Green Finance Instruments