Stock exchanges are increasingly supporting progress towards the Sustainable Development Goals (SDGs).
United Nations Conference on Trade and Development (UNCTAD)-backed Sustainable Stock Exchanges (SSE) Initiative Wednesday updated the growing number of bourses joining the initiative.
A total of 59 stock exchanges, representing more than 70 per cent of listed equity markets across the world, and some 30,000 companies with a market capitalisation of over $55 trillion, have now made a commitment to "advancing sustainability in their markets."
They have joined the Sustainable Stock Exchanges (SSE) Initiative, said the initiative's 2016 progress report.
The latest one is Singapore Exchange (SGX) which joined during an SSE Global Dialogue meeting held in Singapore on 6 September 2016, says a statement.
Stock exchanges are 'uniquely positioned to influence their market' in a way few other players can. In addition to their ability to influence investor and company behaviour, exchanges often support regulators in promoting the adoption of market standards.
The transition to a sustainable financial system means that "market incentives must be aligned with long-term values and environmental, social, and governance considerations need to be integrated into standard practice," said the UNCTAD report.
A total of 12 SSE partners now incorporate reporting on environmental, social, and governance information into their listing rules and 15 provide formal guidance to issuers, the report said.
Stock exchanges can take concrete steps on five of the 17 SDGs, adopted by UN Member States in September 2015, the report says.
These Goals include 5, 8, 12, 13, and 17 on gender, decent work and economic growth, responsible production and consumption, climate change, and global partnerships.
Achieving the Goals will require a large injection of finance, estimated at $5-7 trillion per year, at least some of which will have to come from the private sector.
Describing how stock exchanges represent the intersection between companies and investors, the report noted a growing body of evidence that shows the positive correlation between ESG (environment, society, and governance) performance and strong financial performance too.
However, it notes that financial markets could do more to support achievement of the SDGs.
The SSE Initiative was launched by UN Secretary-General Ban Ki-moon in 2009. It is organised by UNCTAD, the United Nations Global Compact, the United Nations Environment Programme Finance Initiative (UNEP-FI) and the Principles for Responsible Investment (PRI).