Forum on Financing for Development: Risk Reduction, Local Markets

Meetings Coverage
- Economic and Social Council
Forum on Financing for Development, 7th Meeting* (AM) ECOSOC/7228

23 April 2026

Less Perceived Risk, Stronger Domestic Financing Systems, Closer Links to Local Markets Key to Unlocking Private Capital for Sustainable Development, Speakers Tell Forum

The Forum on Financing for Development continued its session today with speakers emphasizing that unlocking private capital for sustainable development will depend on reducing perceived risk, strengthening domestic financial systems and ensuring that financing reaches local economies and communities.

Held annually, this year’s Forum — which runs through 24 April — seeks to build on the momentum of the Fourth International Conference on Financing for Development in Sevilla, Spain, in 2025, where world leaders adopted the Sevilla Commitment, a wide-ranging blueprint to close the development finance gap and mobilize investment for sustainable growth.

The Forum opened with a panel discussion on private business and finance as drivers of sustainable development, with panellists highlighting the need to better align risk and reward.

Calls to Better Align Risk and Reward

Musadik Masood Malik, Minister of Climate Change of Pakistan, speaking via video link, touched on that note.  He said that in many developing economies the “perception of risk is pretty high”, even when viable investment opportunities exist.  While partners are “very happy to meet with us in Sevilla, or in New York”, he said, when discussions turn to concrete deals with big business and the private sector, “it starts to get really complicated”.  While carbon markets are performing well, they are expanding slowly and are not easily tradable.  “It’s not like the NASDAQ or the New York Stock Exchange,” he said.

He also underscored the importance of de-risking tools such as insurance and guarantees, adding that in Pakistan and much of the developing world, including Africa and South Asia, “the perception of risk needs to be lowered”.  “At the end of the day, when you’re making investments in a team, you need to have faith in that team,” he concluded.

José Viñals, Special Strategic Adviser at Standard Chartered and Co-Chair, Global Investors for Sustainable Development Alliance, noting the “multitrillion-dollar shortfall every year”, asked “what it will really take for private capital to help close the sustainable development financing gap”.  As public budgets remain under pressure, private capital is no longer peripheral but essential.  “Quality infrastructure in energy, transport, digital, water, social sectors is fundamental for the growth and development of these economies and the resilience to shocks,” he said, while noting that small and medium-sized enterprises are “the backbone of these economies” but continue to face the toughest barriers to credit.

A central obstacle, he argued, lies in misaligned regulation and policy frameworks.  “Our collective task — both private and public collaboration — is less about inventing new money, but more about steering existing capital at scale towards assets that build resilient, inclusive and sustainable economies,” he stated.

Speaking next, Silvia Carpitella, Senior Management at Citigroup, said the Sevilla Commitment had issued a critical call to action.  The Forum, she noted, underscored the importance of unlocking financial support for sustainable development projects across countries and sectors.  A better “balance of risk and reward” would benefit policymakers, institutions and the private sector alike, she said.  She further stressed the need to strengthen the capacity to manage investment risk, bring “strong local and technical expertise to the table” in structuring projects and help close persistent funding gaps.  “In the days, weeks and months ahead,” she emphasized, “cooperation must be translated into action” to mobilize greater private-sector financing for development at the local level.

Multilateral development banks are increasingly focused on how to better match global capital with development opportunities, said Anderson Caputo, Chief of Connectivity, Markets and Finance at InterAmerican Development Bank.  “The mobilization of capital is really a chain,” he said, requiring de‑risking, regulation, and a strong enabling environment.

He highlighted Ecoinvest Brazil and Reinvest Plus, which work through local banks to mobilize private capital rather than trying to channel international investment directly to projects.  Ecoinvest Brazil has already mobilized about $23 billion in investment commitments and the InterAmerican Development Bank is now working with other development banks to replicate and scale the model internationally.  “We need to look at those that are working… let’s invest in them now and let’s scale them up now.”

“Many viable investments do not fail because of a lack of funding, but because the connection between capital and local demand does not work well enough,” added Karolin Schriever, Executive Board Member of the Deutscher Sparkassen- und Giroverband, a German bank.  Capital will only have an impact if it can be channelled through institutions that are “close to the market, close to the regions and especially close to the people”.  They understand the clients, local conditions, and can “assess risks in a way that cannot be easily standardized”.  “The missing middle is getting bigger and bigger,” she said, referring to the many small and medium-sized enterprises which are economically very well sound, but do not have access to financing that matches their needs.

Success Lies in Clear Standards, Practical Reporting, Nationally Anchored Financing Strategies

In the second panel, the Forum discussed how to strengthen sustainable business and finance for development, with speakers highlighting the importance of clear standards, practical reporting and nationally anchored financing strategies.

Amanda Feldman, Head of Impact Engagement of Sonen Capital, emphasized that reporting is central to mobilizing and scaling private capital, particularly at a time when investors are navigating rapid change in standards and disclosure requirements.  “Private investors are also struggling to keep up with the pace of change,” she said.  While this has not led investors to pull back, it has reinforced the need for greater clarity, consistency and interoperability across standards.  She noted that long‑term private capital — often locked in for “10 years, 15 years” — needs confidence that investments remain compliant and supportive of evolving regulation over time.

Improved standards, disclosures and regulation, she said, are helping investors “take stock of what is possible but also remain committed to the outcomes that they want to achieve”.  She stressed that reporting should be practical and decision-useful, supported by capacity-building on the ground and focused on credibility rather than complexity.

Banking Sector Supplies 90 Per Cent of Sustainable Development Financing in Global South

Several UN officials also weighed in, with Eric Usher, Head of the United Nations Environment Programme (UNEP) Finance Initiative, stating that funding of developing countries’ projects increasingly includes commercial banks.  “Roughly 90 per cent of financing in developing countries comes from the banking sector,” he said, adding that it is a benefit also that the “banking sector remains less sensitive to global risks and shocks”. He noted that an increasing number of banks are financing initiatives in the sustainable development sector.

“Sustainability integration is about prudent risk management, and the capital markets are rewarding those who are taking it seriously,” he added, emphasizing that “sustainability integration is a core aspect of prudent risk management”.  As businesses or investors, “understanding the impact their products and services have on the planet and on social factors is a compass toward what is and what is likely to become financially material over time,” he concluded.

Sustainable finance only works at the country level when it is anchored in national plans, said Marcos Marcini, Global Head of Financial Policy & Regulatory Affairs at United Nations Development Programme (UNDP).  Isolated projects “do not work”, he said.  “Countries need integrated financing approaches that connect plans, budgeting, investment, policy and risk management into a single coherent strategy,” he further stated.  Risk remains the central question.  “What is not insurable, is not bankable; what is not bankable, is not investable,” he added. Regulation, moreover, needs to be anchored with national development priorities.  “We have the frameworks, we have the principles, we now need to avoid the cost of financial fragmentation,” he stated.

Many countries still lack the capacity to fully connect taxonomies, disclosure standards, and other sustainable finance frameworks in ways that effectively mobilize private capital, noted Harald Kuppers, Programme Manager at Gesellschaft für Internationale Zusammenarbeit (GIZ).  The German development agency tackles challenges through a holistic approach to capacity-building that supports Governments, regulators and financial institutions in parallel.

Its work includes developing sustainable finance frameworks, strengthening financial-sector capacity and supporting practical instruments such as green bond issuance, he said.  A core lesson has been that credibility and adoption depend on both global alignment and local relevance.  “Our approach is guided by internationally recognized standards and principles while being tailored to specific country needs through public and private stakeholder engagement,” he said.

Adapt Global Sustainability Reporting Tools to National Circumstances, No Need to Reinvent Wheel

Ede Ijjasz-Vasquez, member of Global Reporting Initiative’s Supervisory Board, emphasized that this organization has been developing global sustainability reporting standards for more than 30 years and that over 10,000 companies now use them, representing more than 61 per cent of global market capitalization.  As Governments increasingly embed sustainability reporting into regulation, its work supports consistency, credibility and global interoperability.

“We don’t need to reinvent the wheel,” he said, noting that the tools are there to be adapted to national circumstances, and the training tools exist to foster vibrant reporting ecosystems in which all stakeholders push for better, more transparent reporting that leads to sustainable income.  The main message is that “sustainability and disclosure only work if it is transparent and credible, if it is easy to understand and if it is actionable by shareholders,” he concluded.

• The 5 th and 6 th Meetings were not covered.

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