How to achieve global leadership in sustainable finance

Talent development will be one of the key pillars of the new Sustainable Finance Roadmap which has been developed by Sustainable Finance Ireland and the UN-hosted Financial Centres for Sustainability network, in collaboration with public and private stakeholders across Ireland including the Department of Finance, Skillnet Ireland and internationally.

The roadmap also envisages the establishment next year of a new international Sustainable Finance Centre of Excellence. The new centre will focus on the practical acceleration of the sustainable finance agenda at a policy, regulatory and market level. With sustainable finance activity surging globally, the centre will lead on research and development activities aimed at supporting the design, development and launch of innovative financial mechanisms to facilitate the transition to a sustainable economy.

Among the key commitments of the Sustainable Finance Roadmap is the development of the skills and knowledge of the future workforce to meet the need for sustainable finance skillsets and building a “community of practice” in the sector. The Sustainable Finance Skillnet will accelerate the design, development, launch and delivery of targeted financial services sector training.

Building capacity and ensuring best practice in reporting and disclosure is another commitment. With a huge amount of new regulations becoming law, the roadmap recognises the need to develop the capabilities to meet these new requirements.

"Skillnet Ireland is committed to supporting the development of sustainable finance talent and welcomes the launch of Ireland's first Sustainable Finance Roadmap," says Skillnet Ireland chief executive Paul Healy. "Together with our industry partners, we are working to advance the knowledge and capability of our workforce, so that Ireland's position as an internationally leading sustainable finance centre can be realised. This roadmap provides a robust talent framework to deliver on Ireland's ambition to be a sustainable finance leader by 2025 and enable Ireland's low-carbon transition."

Responsive plan

Yvonne Holmes, AIB chief sustainability officer and chair of the Sustainable Finance Skillnet committee, also welcomes the new roadmap. "The area of sustainable finance is evolving to meet the expectations of a range of stakeholders, including investors, policymakers, regulators, central banks and wider society. With that change comes the need for a plan that is responsive and can guide Ireland's sustainable finance activities to make sure industry is not just keeping pace but also setting the agenda. The sustainable finance roadmap is that guide which will be central to realising the ambition of the Ireland for Finance Action Plan and specifically in positioning Ireland as a leader in sustainable finance."

The new roadmap reinforces Ireland's leadership position in the area according to United Nations Development Programme Financial Centres for Sustainability managing director Stephen Nolan. "Cop26 reinforced the key role the financial ecosystem must play in supporting the global to national transition to net zero," he says.

"Underpinned by a rapid development of Irish-located sustainable finance talent, Ireland is taking a lead in this area," Nolan adds. "Such leadership was recently reinforced with the launch of Ireland's first national sustainable finance roadmap. Focusing on five core pillars – talent development, industry readiness, leveraging digital, enabling environment and promotion, 50 different Irish entities across policy, the market and academia worked together over seven months to develop the roadmap. Representing an international best-in-class approach, the roadmap clearly articulates Irish priorities to accelerate sustainable finance activities nationally, within Europe and further afield. Importantly it also outlines a process to monitor and track progress."

Healy describes the roadmap as part of the scaffolding around efforts to move to a low carbon economy. “The roadmap will help channel funding into that,” he says. “The financial sector and investment funds are increasingly focusing on the green agenda and are bringing private sector investment into the sustainable economy.”

Low carbon investment

He says that while activities like retrofitting and sectors like renewable energy are obvious examples of the transition to a low carbon economy, the investment and financial aspects needed to enable it are equally if not more important.

“Sustainable finance is still an emerging area,” he adds. “And knowledge and expertise is in short supply. We are looking at two things. First, we need to understand what’s required and then examine how to develop the talent required. The Government sees an opportunity for Ireland to develop a global leadership position and become an internationally recognised centre of excellence. In support of that, Skillnet Ireland is working to improve the quality and capability of those working in the sector.

“A key element of the roadmap is the provision of a talent framework to meet the Government’s ambitions for the sector in 2025,” Healy continues. “This involves a multilayered collaboration which includes Skillnet Ireland, the Department of Finance, Sustainable Finance Ireland, and a cohort of companies in the sector. We have come together to look at the development of knowledge and capability through a number of different programmes.”

The next step involves scaling. “We are already working with over 100 funds and finance firms in Ireland, and we are now looking at how to get more partners involved,” says Healy. “It’s very much about scaling and bringing more actors together. There is already a lot of very generous knowledge-sharing happening in the sector. Urgency of climate crisis is bringing about an increased willingness to collaborate. The Sustainable Finance Skillnet will be working to expand its work and grow the amount of programmes it provides each year. We see that at least doubling.”

He points out that Skillnet Ireland is in a uniquely strong position to play a key role in the achievement of the roadmap’s objectives. “Skillnet Ireland is very well-placed at the intersection between government, industry and the higher education system to make a very big contribution to sustainable finance in Ireland and help the industry achieve the global leadership position aspired to.”