BNP AM

The sustainable investor for a changing world

Trillions of dollars are needed for the UN’s Sustainable Development Goals and those of the Paris Agreement to be met – both are critical for a sound and sustainable economy. Yet existing policies are hindering the necessary flows of capital and require a reset. Enter Modern Monetary Theory (MMT).  

We believe it is clear that under the MMT, governments and central banks can have more scope to spend than previously thought, as also set out in our Investment Outlook for 2022 Shooting the rapids.  

Adopting a framework that is more relaxed about government debt levels and deficit spending, and shifting the focus of central bankers to real world issues such as (the systemic risks around) climate change, could help address the enormous challenges, while still monitoring the long-term stability of the economy and overall financial stability.

Watch this Investment Outlook video and discover why rethinking monetary and prudential policy to include long-term environmental and social targets matters to investors and the sustainability of our future.  

Disclaimer

Please note that articles may contain technical language. For this reason, they may not be suitable for readers without professional investment experience. Any views expressed here are those of the author as of the date of publication, are based on available information, and are subject to change without notice. Individual portfolio management teams may hold different views and may take different investment decisions for different clients. This document does not constitute investment advice. The value of investments and the income they generate may go down as well as up and it is possible that investors will not recover their initial outlay. Past performance is no guarantee for future returns. Investing in emerging markets, or specialised or restricted sectors is likely to be subject to a higher-than-average volatility due to a high degree of concentration, greater uncertainty because less information is available, there is less liquidity or due to greater sensitivity to changes in market conditions (social, political and economic conditions). Some emerging markets offer less security than the majority of international developed markets. For this reason, services for portfolio transactions, liquidation and conservation on behalf of funds invested in emerging markets may carry greater risk.

Related insights

Finding a third way between throttling energy demand and dirty fossil fuel
Weekly investment update – What’s the word?
Investing in influence: Investors, portfolio firms, and political giving