Among the flurry of announcements from last year’s COP28, delegates launched the Capacity-building Alliance of Sustainable Investment (CASI), an international organisation aimed at providing training programmes and e-learning products on sustainable finance to emerging markets.
As part of the launch announcement, CASI said it will “develop and consolidate educational content” in collaboration with its members, tailor them to be more relevant to developing country contexts and deliver them to a larger audience through its network.
PA Future spoke to Paul Moody, managing director of global partnerships and client solutions at the CFA Institute, one of CASI’s founding members, to find out more.
Could you introduce CASI: Why does it exist, and what are its objectives?
CFA Institute is a global organisation, and one of our biggest markets is China. For several years, our team has been working with a gentleman called Dr. Ma Jun, who was the co-chair of the G20 sustainable finance working group. He identified a gap in the market based on the fact there’s a huge amount of money going into green finance and green projects focused in OECD countries and China, but not a lot going to projects based in the countries that experience the biggest detrimental impact of climate change.
One of the biggest challenges, though, is there isn’t enough knowledge or expertise to grow these markets; they don’t have the same financial resources or capabilities. So, Dr. Ma Jun convened a group of leading asset managers, from a sustainability perspective – people like HSBC, Standard Chartered and Neuberger Berman – to found CASI, alongside some non-profit organisations and organisations with regulatory expertise. The group now has over 40 members, and the aim is to make their expertise available to share with emerging markets and developing economies via webinars and in-person events, acting as a global aggregator and distributor of sustainable finance knowledge.
Why do you think those learning gaps exist, and what is CASI’s role in supporting the creation of a level playing field in this regard?
It’s likely because the money hasn’t been there. Developed markets are where a lot of asset managers focus most of their funding on green projects, but NGOs and certainly some of the regulators would highlight how finance can make a huge impact in those developing markets that lack the commercial aspect. So, it’s a bit of a vicious circle, and what we’re trying to do is turn that into a more virtuous circle, whereby we combine all of that expertise, we can identify projects, the investment goes in and it has this continuous benefit.
So, would you describe CASI as a ‘just transition’ initiative then?
Well, I would say that it’s trying to encourage a fairer transition, but it doesn’t have a specific objective in its mission to look at the social impact; it’s not something we’re explicit about. It’s more about developing the expertise to attract more money into green projects and allow greater participation. That should sustainably benefit those countries, and as a result, create a just transition, but one that’s more implicit rather than explicit.
How do you engage with firms to increase your membership base?
Well, like Principles for Responsible Investment (PRI) before us, I think those firms that are sustainability leaders or the more pioneering companies already recognise the value of participating. Once we’ve hit a certain degree of momentum, I think it’ll become the norm to ask why firms are not participating. We’re definitely on our way to that now with 42 members, but I expect us to grow to between 80 and 100 over the next 12 months, including many more large-name asset managers with a focus on Asia, Africa, the Middle East and Latin America.
CASI hasn’t been in operation for very long, but what have you learned since working on CASI, and how is that shaping the organisation going forward?
I suppose CFA Institute has a unique role within CASI, as we’re the only member that’s an educational provider. We’ve previously developed an ESG Investing Certificate, as well as a Climate Risk, Valuation, and Investing Certificate, and we’re sharing bitesize components of those courses and certificates to support that learning process. So, it covers things like taxonomy, disclosure, transition finance, biodiversity, engagement, ESG ratings, those types of things.
The challenge we have going into these developing markets is regulators want to adopt a taxonomy, but the European regulations have set the standard for that, and it’s a massive endeavour to try and replicate because it’s so huge and time-consuming. So, what Dr. Ma Jun has been able to do in markets like, for example, Pakistan is to work with regulators to develop a more simplified, easier-to-apply, less bureaucratic version, reducing the complexity so that it’s probably less than 20% of the European version, while maintaining both a high-standard and consistent approach globally. Chiefly, it’s about adapting all the great things about the European taxonomy to make it more manageable for an economy that doesn’t necessarily have the resources to roll out something on the same scale.
How do you see CASI evolving over time?
I think it’s going to gather more and more momentum. Over time, we hope to build on the various bite-sized education programmes we offer, and that collectively they will become a recognised qualification. There’s been a real demand for expertise in this area, particularly because of the EU’s Sustainable Finance Disclosure Regulation and the Taskforce for Climate-related Financial Disclosures, and I think the talent and expertise we’re fostering will get recognition in home markets and on a more global scale. Between the various founding members, there’s a huge amount of credibility in what we’re offering because of the names involved, and because of the advocacy from people like Dr. Ma Jun, and I expect CASI to become a household name for our industry in the years to come, in the same way as PRI is.
Working on CASI is probably one of the most inspiring things I’ve had the privilege to be involved in because it allows me to keep affecting positive change around financial education on a global scale. If we manage to create a level playing field for emerging markets and developing economies, helping them to truly participate in the global economy, then I think that’s the ultimate measure of success.
