Meanwhile, COVID-19 may have made it even harder for emerging markets to get the investment they need. Some 70% of investors believe the pandemic has widened the capital gap further.
The research points to a growing focus on sustainability, with 81% of investment firms now taking a disciplined approach to environmental, social and governance investment. However, this has not translated into investment in the SDGs. Only 13% of the assets managed by our respondents is directed towards SDG- linked investments.
Some 55% claim the SDGs are not relevant to mainstream investment and 47% say investment in the SDGs is too difficult to measure. However, one fifth of investors admit that they were not aware of the SDGs.
Respondents point to regulatory changes, favourable tax treatment, evidence of higher returns, better data for measuring impact, and increased demand from retail investors as the top five factors that might spur on more SDG investment.
Abrar A Anwar, Managing Director and CEO of Standard Chartered Malaysia, said, “Much progress has been made in recent years to realise the SDGs, but this study makes clear the need to move faster. A seismic, unprecedented surge in private-sector investment – alongside public investment and commitments – will be required to bridge the gap and hit the 2030 SDG targets.
“We were pleased to see the Malaysian Government’s commitment in aligning with the UN’s SDGs through a MYR20 million allocation to the Malaysia-SDG Trust Fund announced recently in Budget 2021. And with sustainability being a big part of the Bank’s focus that includes our commitment to reach net zero emissions by 2030 and help clients transition to a low carbon economy, Standard Chartered is well-positioned as a partner to drive the nation’s green recovery alongside the Government.”
Abrar adds, “There is no single answer to The $50 Trillion Question, but it is evident that investors need to expand their focus beyond developed markets. Malaysia and other emerging economies offer investors a unique opportunity: strong returns combined with the chance to have a significant, positive impact. Now is the time to seize it.”
The $50 Trillion Question study follows the publication of Opportunity 2030: The Standard Chartered SDG Investment Map which first revealed the multi trillion-dollar opportunity for private-sector investors to help achieve the SDGs in emerging markets. Read the full Standard Chartered $50 Trillion Question report.