In Defense of Sustainable Finance

I recently had a conversation about the field of sustainable finance with a friend who is also graduating this semester from SIPA. She had a background working in finance prior to SIPA whereas I certainly did not. We had been discussing our plans for finding jobs post-graduation when she noted how surprised she was that I had come around to fully embracing the idea of working in the field long-term. 

It is true that I have had a bit of a slow and growing embrace of sustainable finance. This friend and I had met in a course we both took in our first semester at SIPA. And this course was not at all related to finance, but the professor, who is in my opinion one of SIPA’s best, did regularly critique the field. She did so by forwarding an argument from Anand Giridharadas’ NYT bestselling book Winners Take All: The Elite Charade of Changing the World. 

The book critiques the global elites’ approach to philanthropy and social change more broadly, often performed through the rebranding of any and all business activities as socially responsible, and business elites as social change agents. In the logic of the book’s argument, this is all in order to maintain influence and the status quo without actually addressing root causes, which sometimes stem from the very actors perpetuating this apparent social change. 

In other words, it is a disingenuous means to launder one’s reputation. In the world of sustainable finance, we recognize similar phenomena, such as greenwashing. From afar, it is not hard to see why sustainable finance could get lumped into this kind of criticism. 

However, over the last year, I have had several engagements in the sector that have allowed me to peel back the layers and learn more about what sustainable finance really is. From someone with no background in anything to do with finance, I have gone from a naïf to someone with research experience at an international financial institution, a capstone with a multilateral development bank, a summer internship in ESG, and now this SIRI consulting project with an international, independent standards-setting organization that is a global leader in impact and sustainability reporting. 

And along the way I have met a diversity of people who have gravitated towards the field, from those dissatisfied with traditional finance’s impacts to those like me who recognize an important area to get involved and do good. Personally, I figure if finance and traditional business activity will always be around, why would a career working to make these areas capture more of their negative externalities not be a potentially high-impact career to pursue? We cannot throw the proverbial baby out with the bathwater and let skepticism slide into pessimism, or worse, regress into nihilism. 

Certainly, there are bad faith actors around, as in all things, hence the need for terms like greenwashing to begin with, but most of the people I have encountered over the last year are critical-thinking and skeptical, but also good-natured and passionate, people working in this area. 

As I come weeks away from graduating, I reflect gratefully on the opportunities SIPA, and SIRI here, provided me that allowed me not only to learn so many new things in this regard but to also grow and change as a person. What more could one ask for in their education?