How sustainable finance initiatives and forums address environmental issues, including climate change, and the challenges they face

Abstract An increasing number of transnational sustainable finance initiatives and forums are focusing on shifting and mobilizing private finance. Consequently, it has become more difficult to grasp the big picture concerning their roles and effects, including how they overlap and synergize. This study examined how transnational sustainable finance initiatives and forums contribute to scaling up private finance and investment and encourage private sector participation. It also explored the challenges that they face in achieving climate-related and other environmental goals. To assess the effectiveness and legitimacy of transnational governance, the institutional and actor-related dimensions and impacts of five major United Nations-related transnational sustainable finance initiatives and forums were analyzed using an analytical framework that included the following elements: transparency, accountability, participation, environmental and other societal impacts, and academic and practical literature. This study showed that each of these initiatives and forums differed in its governing structure and approaches, as well as in its relationship with United Nations-related institutions and actors. Furthermore, overlapping institutions and actors were involved across initiatives and forums, with areas of collaboration between them. While each initiative successfully engaged diverse actors, common challenges emerged, including difficulty in evaluating and enhancing the effectiveness of transnational initiatives and forums, the need for effective links among transnational initiatives and other governance systems (e.g., effective institutional and actor interplay between these voluntary initiatives and compulsory interventions), and the need to include diverse actors. This study showed that more research is required to explore ways of evaluating and enhancing transnational governance of voluntary multistakeholder initiatives and to address the above challenges.