Science-Based Metrics for Sustainable Finance

Purpose and goal:

In order for the sustainable finance industry to have a plausible chance of facilitating the transition towards a more sustainable society, it is vital that it rests on our best available knowledge about the most important sustainability targets as well as the most effective strategies to reach them. The present project seeks to help in this regard by developing robust science-based metrics and guidelines for sustainable finance.

Expected results and effects:

The project explores how financial investments can and should be evaluated from the perspectives of both natural and social science. The scientific results will be presented in the form of a special issue in a top-tier academic journal. The project also develops concrete metrics and guidelines that will be usable by the sustainable finance industry. These are developed in close collaboration with strategic partners from the financial industry.

Approach and implementation:

The project has 4 work packages: (1) Developing a natural-scientific understanding of the most important targets with regards to the Earth system’s boundaries. (2) Developing a social-scientific understanding of how financial markets can have the most effective impact on those targets. (3) Developing an applied-science understanding of how to translate these results into concrete and user-friendly metrics for financiers. And (4) organizing an international and interdisciplinary working group to increase the scientific credibility and uptake of our work.