ESG Club feature – Sustainable debt


SUSTAINABLE DEBT: CLEAN MONEY


With the energy transition needing debt to succeed, how are institutional investors ensuring that their capital is being used to create a sustainable future? Mark Dunne reports.


Debt makes the world go round. It has built civilisations, funded technological and medical breakthroughs and kept armies stocked with the armaments that have changed the course of history. Indeed, today the world’s debt pile stands at $307trn (£251trn), a figure which jumped by $10trn in the first half of this year. Lending money to corporates and governments has for centu- ries been used to change the world. And it is needed once


32 | portfolio institutional | October 2023 | Issue 127


again, but this time to fund the most ambitious project we have ever faced – shifting the world off oil and gas and into cleaner alternatives, while trying to make the world fairer. It’s not an easy task. Especially, when you read headlines claim- ing that it is too hot for solar panels to work or there’s not enough wind in the North Sea to drive the turbines. “Fixed-income markets are critical to funding the transition, as most of the funding will come from the debt markets, both


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