Using sustainable finance theory to save the environment
People usually perceive the finance sector to be the environment’s arch enemy, with its supposed fixation on short-term profits whatever the cost. However, the theories the Goldman Sachses of this world use to make money can also be used to save the environment, if we are open-minded enough to get past the stigma of big finance. Dr. Omar Al-Ubaydli uses a research carried out on coral reef conservation to show features in common with financial assets: their returns are a function of economy-level factors and sector-specific factors. In the case of a coral reef, the list includes rising sea temperatures (economy-level) and local salinity conditions (sector-level); while for stocks the list would include interest rates (economy-level) and industry regulations (sector-level).
Dr. Omar Al-Ubaydli, Director, Studies and Research Directorate