Sustainable Capital Market

Andreea Stoian and Filip Iorgulescu ()
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Filip Iorgulescu: The Bucharest University of Economic Studies

Chapter Chapter 8 in Financing Sustainable Development, 2019, pp 193-226 from Palgrave Macmillan

Abstract: Abstract This chapter aims to discuss the role played by the capital market in promoting sustainable development. The capital market proves to be a very flexible tool that is able to meet the evolving economic, social and environmental needs. Even though it has been shown that society as a whole has not fully internalized the need for socially responsible behavior, the capital market has done so because it has understood that sustainable development presents exciting opportunities. The adjustment of the capital market to the sustainability paradigm did not stop at conceptual strategies or approaches, but led to the creation of new environmental asset classes and innovative funding solutions such as green bonds. In this context, the capital market becomes a leading promoter of the structural reform of traditional businesses from carbon-intensive to climate-friendly projects. However, despite an encouraging start, the financing needs of sustainable development are far higher compared with the current size of green financial markets. Therefore, governments, international institutions, companies and the civil society itself should take a larger proactive role in this transformation by developing and supporting sound climate policies, green infrastructure projects and sustainable businesses.

Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:pal:psifcp:978-3-030-16522-2_8

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DOI: 10.1007/978-3-030-16522-2_8

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