Six months after the publication of the Impact Taskforce’s ‘Time to deliver’ report, Nick Hurd assesses the progress made so far and highlights the need to accelerate efforts to grow the impact investment sector
Nick Hurd, chair of the G7-backed Impact Taskforce (ITF), has called for “faster movement” to advance the impact agenda in areas where action is still lagging behind, six months after the publication of the ITF’s ‘Time to deliver’ report.
The report, which was published last December, outlined actionable recommendations to help transform the quality and transparency of information on the impact of investment decisions, and scale the mobilisation of institutional capital in support of the UN’s sustainable development goals.
In an open letter published last month, Hurd said that the industry-led taskforce had been “particularly encouraged” by developments on the impact transparency front, such as the drafts and proposals to advance climate and sustainability reporting standards from institutions including the IFRS’s International Sustainability Standards Board (ISSB), the US Securities and Exchange Commission and the EU’s European Financial Reporting Advisory Group.
He also highlighted the forthcoming launch of the Just Transition Finance Challenge, a coalition of investors pushing for more financing vehicles that deliver a global, fair and inclusive transition to net zero, and the work of the Glasgow Financial Alliance for Net Zero, as strong examples of impact capital mobilisation.
He wrote: “The existence of coalitions such as GFANZ validate our argument that ‘there is more than enough private capital’ to deliver the SDGs. The challenge remains about how we can make it easier for that capital to flow where it can have the most positive impact on people and the planet.”
Need for greater impact transparency
Since December, the ITF has been calling on companies, regulators, standard setters and investors to work towards a future in which investment decisions, by companies and institutional investors are taken through the triple lens of risk, return and impact.
And whilst there have been individual advances made by regional and global institutions such as the ISSB in this respect, “strong and sustained progress on the impact transparency and integrity agenda will continue to be crucial to address emerging concerns across a number of jurisdictions, including with respect to ESG disclosure and the current lack of clear, consistent and standardised reporting mechanisms”.
Current controversy and confusion among market participants was a call to action to provide higher quality data to stakeholders and underscored the important work of institutions such as the ITF and the ISSB, he noted.
Mobilising capital for positive impact at scale
At its launch, the ITF urged “coordinated movement spearheaded by the G7 to remove multiple external and internal barriers that limited the flow of institutional capital”. But, according to Hurd, global events, particularly the Russian war on Ukraine, had made the financing challenge even greater.
Pointing to the widespread consequences of the war, including disruptions to the world’s food and fuel markets and rising economic volatility, Hurd wrote: “This reinforces in our mind the importance of the impact agenda, and our specific recommendations to boost private investment in emerging economies by dismantling barriers and providing incentives.”
He added that any financial vehicle that was serious about investing in a just and inclusive transition towards the UN’s SDGs, needed to incorporate the three elements of climate and environmental action, socio-economic distribution and equity, and community voice.