Submission of a Partnership Academic Research Project

Proposal for Fundamental and Applied Research Project

Sustainable Finance in Service of Impact Projects: Governance and Regulation Facing the Potentials of Entrepreneurial Support for a Balanced Ecological Transition.

Nota Bene: This Fundamental and Applied Research project does not concern the applied research project related to the creation and deployment of the agile impact project evaluation tool, which is the subject of another academic initiative presented elsewhere.

The research project presented below is part of a broader research framework, within which this evaluation tool should also fit.

Context and Justification

As part of the transition to a low-carbon economy, sustainable finance plays a key role in achieving the Sustainable Development Goals (SDGs) and fulfilling the commitments of the Paris Agreement. However, current regulations struggle to align investments with social and environmental imperatives. Sustainable finance aims to channel capital toward projects with high environmental impact while ensuring sufficient financial returns to attract investors (Impact Finance).

The project is inspired by the work of the Geneva For Future Foundation project, launched in 2018. This Foundation’s mission is to bring together various actors from the public and private sectors to promote sustainable finance solutions through international events such as the Geneva Forum and ongoing collaborations between investors, governments, and businesses. Efforts focus on designing new financial instruments aligned with ESG (Environmental, Social, Governance) criteria.

[(All these proposals revolve around a key concept: linking the standards of finance professionals with those of professionals in entrepreneurial support for impact projects.)]

1. How can financial systems accelerate the transition to a low-carbon economy?
2. What governance mechanisms ensure responsible investment?
3. The role of legal and political frameworks in promoting sustainable investments.
4. The growing demand for green financial products aligns well with the project’s goal of exploring how finance can better serve ecological objectives.

Research Issues and Questions

The main research questions are as follows:

1. How to adapt current legal frameworks to encourage sustainable finance while ensuring attractive returns?
2. What regulatory barriers prevent the mobilization of private capital in green projects?
3. What governance mechanisms can strengthen the alignment of investments with long-term sustainability goals?

Research Hypotheses

1. Hypothesis 1: Current regulations lack flexibility to effectively integrate sustainable investments, hindering the adoption of ESG practices by institutional investors.
2. Hypothesis 2: The adoption of financial instruments such as green bonds and ESG loans would enhance investor confidence and allow better allocation of financial resources toward sustainable projects.
3. Hypothesis 3: Harmonization of international regulations and the integration of ESG criteria into national policies would reduce current barriers to sustainable finance.

Actors and Partners

The Geneva Foundation for the Future project, launched in 2018, is an international platform dedicated to aligning financial flows with global sustainability goals, particularly the Sustainable Development Goals (SDGs) and the Paris Agreement. Each year, during its high-level workshop organized at the Geneva Forum, the project brings together actors from finance, the private sector, governments, and civil society to discuss best practices for directing investments towards ecologically and socially responsible projects. The platform emphasizes innovative financial instruments such as green bonds, nature finance, and transition finance, aimed at supporting large-scale initiatives for ecosystem restoration while generating financial returns.

The initiative places particular importance on integrating ESG (Environmental, Social, and Governance) criteria into investment strategies, as well as on financial inclusion, a crucial issue for reducing global economic inequalities. In parallel, the Geneva Foundation for the Future proposes directing its stakeholders towards blended finance solutions, combining public and private funds to meet the challenges of the ecological transition. Inclusive finance also plays a central role by facilitating access to capital for underserved populations and promoting inclusive and equitable financial solutions.

The workshops, discussions, and training sessions offered by the Geneva Forum and the Geneva Foundation for the Future are designed to encourage dialogue between different actors. They provide exchange platforms on topics such as natural capital management and impact investment mechanisms. These events aim to bridge the gap between Finance and Impact Project stakeholders to design concrete and sustainable solutions to global financial challenges.

The Geneva Foundation for the Future also highlights the issue of transition finance, which is essential for enabling developing countries to carry out climate resilience projects. This mechanism requires not only increased financial support but also international cooperation to fill the funding gaps for green initiatives in these countries. Thus, the platform calls for a stronger role for the private sector in supporting ecological transition policies, while encouraging the adoption of coherent policy frameworks to ensure the success of sustainable investments.

Partnerships with major financial institutions, large private banks, and leading companies in the sector encourage these organizations to integrate sustainability into their investment strategies. These collaborations aim to promote investment portfolios that combine financial profitability with positive social impact. Nature finance is another aspect that the Foundation wishes to explore and bring to constructive debate, as despite the importance of valuing natural capital and creating standardized mechanisms to measure biodiversity gains and ecosystem restoration, the question arises of the anthropocentric approach to this process, which may be incompatible with a sustainable resolution of the problems generated by this anthropocentrism in the first place.

The Geneva Foundation for the Future embodies a global dynamic where financial actors and policymakers co-construct innovative solutions for a resilient, sustainable, and equitable economy, in partnership with experts in identifying and supporting impact projects. This Foundation is distinguished by its cross-sectoral approach and its ability to bring together stakeholders from around the world around a shared vision of green finance focused on direct investments in the field, without intermediary systems.

In this context, the success of the fundamental and applied research project relies on international and multisectoral collaboration with the following actors:

International financial institutions (banks, pension funds): Analysis of ESG criteria adoption and its impact.
Regulators and government agencies: Study of current regulations and identification of necessary reforms.
NGOs and international organizations such as the UN and the UNEP Finance Initiative: Facilitation of coordination between the public and private sectors.
Universities and research centers: Academic research to identify legal frameworks and propose innovative solutions.
Companies in the renewable energy sector: Testimonials on market needs for green investments.

5-Year Timeline

Year 1: Mapping of current regulations, data collection, and first phase of case studies.
Budget: €150,000 (WP1: €100,000, WP2: €50,000)

Year 2: Economic and legal modeling, initial recommendations for improving existing frameworks.
Budget: €200,000 (WP1: €80,000, WP2: €70,000, WP3: €50,000)

Year 3: Launch of pilot projects with regulators and financial partners.
Budget: €250,000 (WP3: €100,000, WP4: €100,000, WP2: €50,000)

Year 4: Empirical analysis, refinement of hypotheses, publication of interim results.
Budget: €230,000 (WP2: €80,000, WP3: €80,000, WP4: €70,000)

Year 5: Dissemination of results, organization of international conferences, publication of final recommendations.
Budget: €300,000 (WP4: €150,000, WP1: €50,000, WP3: €100,000)

Workpackages (WP)

WP1: Analysis of existing regulatory frameworks
Objective: Map national and international regulations on sustainable finance.
Methodology: Comparative case studies across multiple jurisdictions, literature review.
Budget: €230,000

WP2: Case studies on financial incentives
Objective: Study the effectiveness of financial instruments (green bonds, ESG funds) in mobilizing capital.
Methodology: Quantitative analyses and interviews with stakeholders.
Budget: €250,000

WP3: Regulatory reforms and new governance mechanisms
Objective: Propose regulatory reforms and incentive mechanisms for sustainable investments.
Methodology: Legal analysis, economic modeling.
Budget: €330,000

WP4: Stakeholder engagement and dissemination
Objective: Ensure broad dissemination of results through conferences, publications, and seminars.
Methodology: Academic publications, webinars, international events.
Budget: €320,000

Role of the university partner in fundamental research

Department Director: Responsible for overall supervision, validating research directions, and ensuring work coherence.
PhD Student: Analysis of regulatory obstacles in various jurisdictions.
Postdoctoral Fellow: Study of innovative financial instruments and modeling their impact.
4 Master’s Students: Participation in case studies and empirical data collection.

Role of the engineering school partner in applied research

The engineering school specializing in international markets will handle practical and commercial aspects:

Department Director: Supervision of market strategies and partnerships.
4 MBA students: Market studies, modeling of sustainable finance practices.

Role of the foundation partner in project implementation

The foundation will facilitate the transformation of research results into concrete actions:

Scientific Director: Supervision of scientific aspects and alignment with objectives.
Legal Officer: Analysis of legal implications of proposed reforms.
Business Development and Financial Relations Officer: Mobilization of funding and creation of partnerships.

5-Year Budget Overview

This multi-disciplinary project brings together expertise in finance, law, economics and management to propose sustainable solutions to today’s financial challenges.

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