Tom Below has spent more than 25 years working at the intersection of policy, climate, and global development.
He now leads the UN's Development Program, Sustainability Finance Hub, an operation that spans 170 countries and is focused on one critical question.
How do we get money flowing to the places and projects that matter most?
So now to answer that question, we have Tom.
Tom, welcome to FinTech.
Thank you so much.
How are you today?
I'm thrilled to be here at the New York Stock Exchange.
Thank you.
So Tom, let's talk a little bit more about your work and what you're doing.
So how are you helping government and issuers translate those SDG priorities into real market opportunities, and what role does sustainable finance instruments play in making all this happen?
Well, thanks for the question.
I uh I begin by saying I work for a development institution, the United Nations Development Programme, as you've said, and we do work in partnership with financial institutions, with the private sector, with a focus to bringing their transactions towards sustainable development.
And let me give you an example which I think is very relevant to where we are.
We work a lot with financial institutions and governments around the issuance of SDG aligned bonds, debt instruments.
So we bring the development expertise, for example, to the Ministry of Finance of Indonesia and help them structure a bond which is green in nature with a pipeline of impactful projects.
We then work with the World Bank, for example, to take that to stock exchange for issuance.
This is critical.
We've mobilized around $40 billion of finance through these uh SDG aligned bonds on different stock exchange around the world.
Uh, another example is Cabo Verde, where we helped establish the Blue X, uh, a blue bond platform for, uh, a small island state, uh, in Africa.
Uh, finally, we've worked also in, for example, Zambia in helping the stock exchange and the Securities Exchange Commission establish guidance for the issuance of green bonds on the Zambian market.
So all examples of where we bring a development understanding to the financial understanding of financial institutions and make both financial return and development return.
Truly fascinating.
So let me ask you this, investors, they are increasingly being asked to account for social and human rights risks, but you're turning those risks into decision useful information, and that's not easy.
So you've been working on that through initiatives like FAST and TI.
SFD.
So can you walk us through what those are and how they help the market actors actually make and manage these risks?
Yeah, thanks, thanks for the question.
FAST stands for Finance Against slavery and trafficking.
And this is a really important initiative, uh, which is trying to ensure that financial institutions, the private sector, are factoring in not just the benefits of taking a human rights-based approach, but also the costs of not taking a human rights-based approach.
We've just released the fast investment.
Report last week, which provides lots of quantifiable evidence to show how important it is that the private sector factors in anti-slavery and trafficking measures in their business operations.
It shows how reputational risk, supply chain, disruption.
Can all lead to a devaluation of companies and uh this I think is the most important message, that taking a human rights based approach to investment is good for business.
So let's talk a little bit more about sustainable finance commitments.
That's one thing, but implementation is another one.
So, UNDP has been working on these type of projects, specifically in markets like Thailand.
So, what does this work look like on the ground?
Yeah, I mean, Thailand is a, a, a great example, I think, of where we bring together a focus.
On development and on financial return.
We've worked with the stock exchange in, in Thailand, SET and the Securities Exchange Commission in Thailand to develop guidance around impact management and measurement for companies listed on the stock exchange, as well as to take for training of those companies.
The Thailand Stock Exchange has around 800 companies that we're working with listed at a value of around 600+ billion dollars.
That's a huge amount of capital.
When we talk about development, we need to be talking about these volumes of capital, which really can create the change that we need to see.
And I think it's also an example of where, again, by working as a development institution with financial institutions, we can deliver both on the financial metrics and the development metrics required for our planet.
So let's talk a little bit more about how you guys make things from pledges.
You move from pledges to credible, measurable results.
What does that look like and how does that happen?
Well, I think the most important thing to think about when it comes to developing countries and their access to investment and capital is the enabling environment in these countries.
UNDP as you said in your kind introduction, works in 170 different countries.
We understand the governments and the private sector and the challenges they face in mobilizing investment.
We work, for example, on governance and rule of law issues.
These are fundamental to dispute arbitration when it comes to business or transparency and accountability around procurement practices.
Without that enabling environment, capital has a higher cost for countries uh in the developing world.
They're sorely in need of policy and regulations that enable finance to flow.
For example, simple legislation around bond issuance doesn't exist in many economies.
The importance of insurance and policy and regulation around risk management is also a concern in many emerging economies.
A final area that we are bringing stronger focus to in the development of community is the importance of bankable projects, of building pipelines of bankable projects to access.
Capital in emerging markets.
We feel that the private sector, financial institutions, development institutions like ours need to work together more to expand market opportunities and deliver benefits for emerging economies.
So, I wanna talk with you a little bit more about the policy side of things.
So, even the best sustainable finances, they need the right conditions to work.
And also, what exactly has to be in place for things to become standard market practice.
The major challenge of our time when it comes to creating that environment in developing economies is partnership.
At the moment, development institutions like ours work in the development sector.
Financial institutions and the private sector are are working under different metrics in different ways, in parallel to our development community.
What we really need to do to create both the win for investors who are looking to expand opportunities.
And the win for development practitioners like ourselves in in UNDP is to find a common way of working at the country level.
We have one initiative I would like to highlight, which is around integrated national financing frameworks.
We work in 86 different emerging economies, together with the private sector to help governments understand what conditions.
Need to be in place for the private sector to reduce the perceived risk of that market, and for us from the development side to maximize the development returns of those investments.
These integrated national financing frameworks have unlocked some $36 billion of investment over the last two years.
We see that as an opportunity for partnership in the emerging economies.
Well, Tom Blo, thank you so much for joining us.
Your insight was fantastic and obviously the work that you guys are doing truly world-changing all across the board.
Thank you so much.
Thank you so much for the opportunity to be here.
My pleasure.
