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New standards in ESG reporting (Environmental, Social, Governance) present a tall order for all Caribbean financial market participants. The immediate aims may be to more sharply define purpose with profit: to diversify; to grow; to be efficient. However, the ultimate goal is the urgent climate change directive initially articulated by Caribbean scientists for Small Island Developing States: to keep global warming within 1.5 C for the chance to stay alive. One of the biggest challenges will be to attract large investment across projects that involve many small players.

While the rise in ESG-themed investments is the global trend, the acceleration and total quantum of funds has been highest in Europe. The sustainable finance community has been growing the volume and diversity of products rapidly since the European Investment Bank issued a green bond in 2007 and World Bank issued the first such bond in 2008. The sustainable bond market alone (this includes green, social, and sustainability-linked bonds) was estimated to rise by 59 percent in 2021 to reach $850 billion, accounting for eight to 10 percent of global debt issuance according to Moody’s.

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