Sustainability In Motion

In Episode 21 of Sustainability in Motion, Matt Orsagh and Maria Maisuradze speak with Jo Paisley, President of the GARP Risk Institute, about the evolving landscape of sustainability risk in the financial sector. With deep experience from the Bank of England to HSBC, Jo brings a unique lens on how financial professionals can better prepare for climate and nature-related challenges.

We cover:

• Jo's journey from economist and regulator to sustainability thought leader
• What GARP and the GARP Risk Institute are doing to advance risk literacy in sustainability
• Key findings from their Nature Risk Management surveys—what's shifting in how institutions assess and respond to nature-based risks
• Common misconceptions in the industry around sustainability risks and how to bridge the knowledge gap
• The most pressing sustainability risks on the horizon for the financial sector—and how to manage them effectively

At ED4S, we believe that understanding and managing sustainability risks is no longer optional—it's essential. That's why we design company- and role-specific sustainability training programs that are efficient, relevant, and outcome-driven. Our goal is to close critical knowledge gaps and empower professionals to take meaningful action—without wasting time on generic content.

About ED4S

ED4S delivers customizable sustainability workforce training, simulation-based learning, and corporate sustainability programs tailored for financial institutions. Our practical, scalable solutions ensure teams can act confidently on sustainability insights while reducing operational and reputational risk.

Services Include:

• Role-specific eLearning modules

• Simulation-based training for client-facing teams

• Technology and Green AI training

• Live workshops and toolkits

• Continuous content updates and compliance assurance

ED4S empowers organizations to embed sustainability across their workforce and transform sustainability literacy into measurable business value.

To learn more, visit https://www.ed4s.org/

In this eye-opening episode, we unpack the quiet crisis in corporate governance: how boardrooms are often shaped by personal networks over real skills, leaving major ESG blind spots at the top. Guest Matt Moscardi, Co-founder of Free Float Analytics, joins us to explore signals that companies send by backtracking on their commitment and why treating investment stewardship as a cost center may be a costly mistake. We dive into the DEI backlash, flip-flopping climate commitments, and how surface-level sustainability reports (complete with curated optics) reveal more about a company's culture than they realize. Plus, what makes a great sustainability analyst? It's not just the data—it's the curiosity, context, and ability to challenge the narrative. Perfect for anyone building ESG skills, delivering corporate sustainability training, or decoding the signals behind the statements.

About ED4S

ED4S delivers customizable sustainability workforce training, simulation-based learning, and corporate sustainability programs tailored for financial institutions. Our practical, scalable solutions ensure teams can act confidently on sustainability insights while reducing operational and reputational risk.

Services Include:

• Role-specific eLearning modules

• Simulation-based training for client-facing teams

• Technology and Green AI training

• Live workshops and toolkits

• Continuous content updates and compliance assurance

ED4S empowers organizations to embed sustainability across their workforce and transform sustainability literacy into measurable business value.

To learn more, visit https://www.ed4s.org/

We talk with Victoria Hurth, a Pracademic (practitioner and academic) to help define and describe a well-being economy. We discuss how to get to a wellbeing economy from our current state, and what companies and investors need to do to move in that direction.

About ED4S

ED4S delivers customizable sustainability workforce training, simulation-based learning, and corporate sustainability programs tailored for financial institutions. Our practical, scalable solutions ensure teams can act confidently on sustainability insights while reducing operational and reputational risk.

Services Include:

• Role-specific eLearning modules

• Simulation-based training for client-facing teams

• Technology and Green AI training

• Live workshops and toolkits

• Continuous content updates and compliance assurance

ED4S empowers organizations to embed sustainability across their workforce and transform sustainability literacy into measurable business value.

To learn more, visit https://www.ed4s.org/

We talk about the issue of income inequality and why understanding income inequality is important for investors. We discuss the causes of inequality, the ways that inequality impacts our economy and investments. Listeners can learn ways to measure income inequality, and how to integrate inequality analysis and analysis of other systemic issues into the investment process.

About ED4S

ED4S delivers customizable sustainability workforce training, simulation-based learning, and corporate sustainability programs tailored for financial institutions. Our practical, scalable solutions ensure teams can act confidently on sustainability insights while reducing operational and reputational risk.

Services Include:

• Role-specific eLearning modules

• Simulation-based training for client-facing teams

• Technology and Green AI training

• Live workshops and toolkits

• Continuous content updates and compliance assurance

ED4S empowers organizations to embed sustainability across their workforce and transform sustainability literacy into measurable business value.

To learn more, visit https://www.ed4s.org/

In this episode, Matt, Maria, and Nawar reflect on their 2024 sustainability predictions and look ahead to what's coming in 2025. They discuss the ESG backlash, evolving sustainability regulations, and key trends shaping the future. Tune in as they analyze past forecasts and make bold predictions for the year ahead! 🎙️🌍

About ED4S

ED4S delivers customizable sustainability workforce training, simulation-based learning, and corporate sustainability programs tailored for financial institutions. Our practical, scalable solutions ensure teams can act confidently on sustainability insights while reducing operational and reputational risk.

Services Include:

• Role-specific eLearning modules

• Simulation-based training for client-facing teams

• Technology and Green AI training

• Live workshops and toolkits

• Continuous content updates and compliance assurance

ED4S empowers organizations to embed sustainability across their workforce and transform sustainability literacy into measurable business value.

To learn more, visit https://www.ed4s.org/

In this episode of the Sustainability in Motion podcast, hosts Matt Orsagh and Maria Maisuradze engage in an insightful discussion with William Burckart, CEO of the Investment Integration Project (TIIP), which helps investors integrate systems thinking in the investment process. The conversation explores the transformative concept of systems-level investing, a forward-thinking approach that integrates financial, social, environmental, and economic systems to address systemic risks such as climate change, inequality, and resource scarcity.

Key highlights include:

• Introduction to Systems-Level Thinking: Bill explains the shift from traditional investment strategies to a holistic approach aimed at mitigating root causes of systemic risks rather than their symptoms.
• Practical Applications: Examples such as large-scale infrastructure projects and innovative asset allocation strategies that address interconnected societal and environmental challenges.
• Bridging Theory and Practice: How tools, techniques, and collaboration across sectors can help investors influence broader systemic change.
• Building Executive Buy-In: Practical advice for sustainability professionals on initiating and sustaining meaningful organizational change through systemic thinking.

The episode underscores the importance of aligning financial investments with long-term sustainability goals, making it a must-listen for anyone interested in advancing responsible investing and fostering resilience across global systems.

About ED4S

ED4S delivers customizable sustainability workforce training, simulation-based learning, and corporate sustainability programs tailored for financial institutions. Our practical, scalable solutions ensure teams can act confidently on sustainability insights while reducing operational and reputational risk.

Services Include:

• Role-specific eLearning modules

• Simulation-based training for client-facing teams

• Technology and Green AI training

• Live workshops and toolkits

• Continuous content updates and compliance assurance

ED4S empowers organizations to embed sustainability across their workforce and transform sustainability literacy into measurable business value.

To learn more, visit https://www.ed4s.org/

Episode Overview: In this episode, Matt Orsagh and Nawar Alsaadi of ED4S sit down with Jon Lukomnik, a leading figure in sustainable finance and co-author of Moving Beyond Modern Portfolio Theory. Jon explores the limitations of Modern Portfolio Theory (MPT) in addressing long-term, systemic risks like climate change, highlighting the evolution toward "system-level investing."

Key Takeaways:

1. Limitations of MPT:

   • MPT is designed for idiosyncratic risk (individual asset variance) but fails to account for systemic risks, which cannot be diversified away. Lukomnik notes that while MPT focuses on market-relative risk, it overlooks larger economic and environmental factors that affect the entire market.

2. System-Level Investing:

   • Lukomnik advocates for a shift towards system-level investing, where investors engage in strategies to mitigate systemic risks like climate change, inequality, and biodiversity loss. This approach involves collaborative stewardship and policy engagement to reduce overall portfolio risk.

3. Collaboration and Collective Action:

   • Collaborative efforts, such as Climate Action 100+, enhance the impact of investors on global issues. Though the free-rider problem exists, Lukomnik observes that collective initiatives are crucial in addressing systemic challenges.

4. Practical Approaches:

   • Practical tools for system-level investors include investment enhancements (e.g., climate-aligned private equity and infrastructure projects), stewardship, policy advocacy, and setting clear boundaries for ESG targets. Engaging with policymakers and stakeholders strengthens the collective response to systemic risks.

5. The Role of Policy:

   • Effective systemic risk mitigation requires a synergy between investors, policy, and NGOs. Policy is critical in shaping sustainable practices, yet investor engagement and capital flow remain vital in driving actionable change.

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Transcript:

Hello, everyone! Welcome to the Sustainability in Motion podcast, brought to you by ED4S. Our focus is on the fast-moving world of sustainability, helping the business community better understand and navigate the environmental and sustainability challenges we face. I'm Matt Orsagh, Chief Content Officer at ED4S.

And I'm Nawar Alsaadi, Founder and CEO of Kanata Advisors and Senior Advisor to ED4S. Today, we're excited to bring you a thought-provoking conversation with someone we've been fortunate to know for many years: Jon Lukomnik.

Jon has had a distinguished career in the financial world. He's a former investment advisor for New York City's pension fund, co-founder of the International Corporate Governance Network (ICGN), and an adjunct professor and Brennenmeyer Fellow at Columbia University. He's also the co-author of several books on corporate governance and finance, including his latest: Moving Beyond Modern Portfolio Theory, which we'll dive into today.

Jon, welcome to the podcast!

Jon Lukomnik: Thank you! It's a pleasure to be here.

The Limitations of Modern Portfolio Theory (MPT)

Matt Orsagh: Let's start with your 2021 book, Moving Beyond Modern Portfolio Theory, co-authored with James Hawley. In it, you discuss the limitations of MPT in addressing long-term systemic risks like climate change. Could you elaborate on these limitations?

Jon Lukomnik: Certainly. While MPT is a powerful tool for constructing portfolios with the best risk-adjusted returns based on existing market data, it has critical limitations.

First, it assumes market levels are exogenous, meaning it doesn't account for the factors that influence the overall health of the market, such as systemic risks. Studies show that 75% to 94% of variability in total returns comes from the general price level of the market—something MPT doesn't address.

Second, MPT focuses on idiosyncratic risks—risks specific to individual securities or sectors—and manages them through diversification. However, it does not address systemic risks, like climate change or inequality, which affect the entire market.

Lastly, MPT's reliance on historical data and static assumptions can disconnect it from the real-world dynamics that drive long-term value and risk. As a result, it falls short in guiding investors on how to address risks and opportunities arising from systemic changes.

Introducing System-Level Investing

Nawar Alsaadi: Building on that, Jon, it seems like MPT encourages investors to focus on what they can control, even though what they can't control—systemic risks—has a far greater impact on portfolio performance. This leads us to system-level investing. How does it differ from traditional approaches, and why is it essential for tackling risks like climate change or inequality?

Jon: That's a great question. System-level investing differs fundamentally from traditional approaches in its focus. Traditional investing, as framed by MPT, focuses on relative performance—comparing investments against the market or peers. In contrast, system-level investing looks at the broader picture, aiming to improve the overall health and performance of the market by mitigating systemic risks.

For example, climate change is a systemic risk that cannot be diversified away. It creates systemic vulnerabilities that ripple through the economy and financial markets. System-level investors recognize that addressing these risks in the real world—through stewardship, policy engagement, or collaborative action—can reduce systemic risks and improve portfolio performance over the long term.

System-level investing complements MPT by first addressing the underlying health of the market and then applying MPT's tools to construct portfolios within a more stable and resilient market environment.

Practical Steps for System-Level Investing

Matt: This is fascinating. Could you share some practical steps for investors looking to incorporate systemic thinking into their portfolios? Are there specific tools or frameworks available?

Jon: Certainly. Here are some key steps and tools:

1. Enhancing Existing Practices:

   • Stewardship: Move beyond company-specific issues to engage on system-wide challenges. For instance, participate in initiatives like Climate Action 100+ to drive collective action.
   • Thematic Investments: Focus on areas like renewable energy, green infrastructure, or climate solutions that align with system-level goals.
   • Policy Engagement: Work with policymakers to support regulations that mitigate systemic risks, such as carbon pricing or sustainability disclosure requirements.

2. Setting Goals and Boundaries:

   • Define clear investment beliefs that incorporate systemic risks. For example, PGGM, a Dutch pension fund, has adopted a "3D" approach: risk, return, and impact.
   • Align compensation structures with long-term, system-wide outcomes rather than short-term

Hosts:

• Matt Orsagh, Chief Content Officer at ED4S
• Nawar Alsaadi, CEO of Kanata Advisors, Chief Advisor at ED4S

Guest:

• Natasha Chaudhary, Research Fellow at The Institute for Climate Economics (I4CE)

Episode Focus: The concept of stranded assets and a shift toward "assets at risk" to better support financial institutions in navigating climate-related financial risks.

Key Takeaways:

1. Stranded Assets Explained:

   • Traditionally associated with fossil fuels, stranded assets refer to devalued resources due to regulatory, market, or physical climate changes. Current definitions often focus on oil, gas, and coal sectors, but the concept can apply across industries.

2. Reframing to "Assets at Risk":

   • Natasha advocates shifting from "stranded assets" to "assets at risk," broadening the focus to include potential asset value losses across all sectors under transition pressures. This proactive approach allows financial institutions to better anticipate risks and guide capital toward sustainable investments.

3. Proactive Risk Management:

   • "Assets at risk" encourages financial institutions to manage risks dynamically, considering the entire value chain and transition readiness of companies, thereby supporting real-economy decarbonization rather than simply divesting from risky sectors.

4. Sectoral Examples Beyond Fossil Fuels:

   • Key sectors such as real estate, agriculture, and automotive also face significant risks. For example, the EU's building regulations for decarbonization by 2050 and the upcoming ban on internal combustion engines by 2035 present immediate risks to financial portfolios.

5. The Need for Regulatory Guidance:

   • Clear regulatory frameworks and standardized transition plans are essential to accurately assess transition readiness across sectors, helping institutions manage climate risks effectively.

Conclusion: This episode emphasizes the importance of expanding the stranded assets framework to support proactive and comprehensive risk management across sectors, highlighting the role of financial institutions in driving climate-aligned investments.

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Transcript:

Welcome to the Sustainability in Motion Podcast!

Hello, everyone! Welcome to the Sustainability in Motion podcast, brought to you by ED4S. Here, we focus on the rapidly evolving world of sustainability, helping the business community navigate environmental challenges and opportunities. I'm Matt Orsagh, Chief Content Officer at ED4S.

And I'm Nawar Alsaadi, Founder and CEO of Kanata Advisors and Senior Advisor to ED4S. Today, we're thrilled to be speaking with Natasha Chaudhary, a Research Fellow at the Institute for Climate Economics, also known as I4CE.

Natasha recently authored the paper From Stranded Assets to Assets at Risk: Reframing the Narrative for European Private Financial Institutions. This paper takes a deep dive into the concept of stranded assets, a topic many of us have encountered but might not fully understand. Welcome to the podcast, Natasha!

Natasha Chaudhary: Thank you for having me!

Matt Orsagh: Let's start by level-setting. Most of our audience has likely heard of stranded assets, but could you explain the concept as it's used today? Where does it come from, and how is it applied?

Understanding Stranded Assets

Natasha: Certainly! Theoretically, the idea of stranded assets has been around for quite some time. However, it gained practical traction about a decade ago, particularly between 2012 and 2014, when pioneering research at the University of Oxford began to spotlight the issue.

The concept became especially relevant due to its link with the fossil fuel industry and global warming. Essentially, stranded assets are resources—such as oil, gas, or coal reserves—that can no longer be extracted, used, or sold due to external changes. These changes might be regulatory, such as a ban on fossil fuel extraction, or economic, driven by market shifts.

One critical idea underpinning this is the "carbon bubble," which suggests that a significant portion of fossil fuel reserves currently listed as assets by oil and gas companies may lose their value as we transition to a low-carbon economy. The issue arises because these risks are often not fully reflected in current valuations, creating a bubble.

Organizations like the Carbon Tracker Initiative have explored these risks extensively, categorizing them into three types:

1. Regulatory stranding – driven by strict policies or bans.
2. Physical stranding – resulting from climate events like floods or droughts.
3. Economic stranding – caused by market changes, such as declining demand or cost inefficiencies.

Expanding the Lens: Assets at Risk

Nawar Alsaadi: In your paper, you argue that the concept of stranded assets is too narrow, particularly when applied to financial institutions. You propose a broader framework—assets at risk. Could you elaborate on this and explain why you think it's a better framing?

Natasha: Of course. The traditional understanding of stranded assets is heavily tied to the fossil fuel sector and focuses on quantifying losses. While this is important, it misses the broader picture. Stranding risk isn't exclusive to fossil fuels; it can affect any sector undergoing significant decarbonization pressures.

The concept of assets at risk broadens this perspective. It acknowledges transition-driven risks across various sectors, supply chains, and financial portfolios. Instead of being reactive, it promotes proactive engagement. Financial institutions can anticipate potential risks, identify assets at risk within their portfolios, and work collaboratively with entities to mitigate these risks.

This approach shifts the focus from risk avoidance to opportunity creation. By enabling financial institutions to engage with businesses and governments, they can drive the transition from "brown to green" through strategic financing and innovation.

Proactive Risk Management in Practice

Matt: You touched on this earlier, but could you delve into what a proactive, dynamic approach to managing assets at risk looks like in practice? Do financial institutions have the capacity to implement this today?

Natasha: Great question. Financial institutions already have many tools at their disposal, such as sectoral financing policies and climate-related stress testing. However, these tools need to be more comprehensive and inclusive of non-project-based financing, which represents a significant portion of financial portfolios.

Proactive risk management involves:

1. Broadening sectoral policies – ensuring they encompass all financing activities, not just project-related ones.
2. Enhanced risk assessments – evaluating the financial soundness and transition readiness of counterparties.
3. Whole-of-economy lens – assessing risks across all sectors, supply chains, and transition timelines.

For example, in the real estate sector, energy performance certificates (EPCs) provide insight into building efficiency and potential stranding risks. In agriculture, outdated infrastructure may become stranded as regulatory pressures grow.

By identifying assets at risk early, financial institutions can actively work with stakeholders to retrofit, repurpose, or retire assets in a managed and efficient way.

Quantifying the Magnitude and Timelines

Nawar: What's the scale of this problem beyond oil and gas? Do we have any sense of its magnitude, and are we looking at near-term or long-term impacts?

Natasha: Quantifying the magnitude is challenging due to uncertainties and varying methodologies. Even within the fossil fuel sector, estimates of stranded assets range from $1 trillion to $185 trillion, depending on assumptions about transition speed and policy actions.

However, we can gain insights from related metrics. For instance, the European Central Bank's stress test revealed that 40% of Euro-area bank loan portfolios are exposed to energy-intensive sectors, highlighting the scale of potential risks.

As for timelines, risks are both near-term and long-term. For instance, the EU's Energy Performance of Buildings Directive targets a fully decarbonized building stock by 2050, with significant milestones along the way. Similarly, the automobile sector faces a 2035 deadline for phasing out internal combustion engine vehicles.

Final Thoughts: Regulatory Reform

Matt: If you had a magic wand to propose one regulatory reform to address assets at risk, what would it be?

Natasha: It would be establishing clear regulatory guidelines for assessing the transition readiness of counterparties. This would standardize how financial institutions evaluate risks and align their portfolios with decarbonization goals.

By providing clear parameters and expectations, regulators could help banks better assess transition risks and identify opportunities to support a just and efficient transition.

Matt: Natasha, this has been a fantastic conversation. Your paper is a must-read for anyone in the financial sector.

Nawar: Agreed. Thank you for joining us, Natasha. For our listeners, you can find more about ED4S at ed4s.org. If you'd like to connect with Natasha, Matt, or me, we're all active on LinkedIn. Thanks for tuning in!

About ED4S

ED4S delivers customizable sustainability workforce training, simulation-based learning, and corporate sustainability programs tailored for financial institutions. Our practical, scalable solutions ensure teams can act confidently on sustainability insights while reducing operational and reputational risk.

Services Include:

• Role-specific eLearning modules

• Simulation-based training for client-facing teams

• Technology and Green AI training

• Live workshops and toolkits

• Continuous content updates and compliance assurance

ED4S empowers organizations to embed sustainability across their workforce and transform sustainability literacy into measurable business value.

To learn more, visit https://www.ed4s.org/

Hosts:

• Matt Orsagh, Chief Content Officer at ED4S
• Maria Maisuradze, Founder and CEO of ED4S
• Nawar Alsaadi, CEO of Kanata Advisors, Senior Advisor to ED4S

Episode Focus: A discussion on ED4S's new paper, "Operationalizing Sustainability: Eight Key Roles in Finance," which offers practical guidance for embedding sustainability in financial roles.

Key Takeaways:

1. Purpose of the Paper:

   • This paper addresses how financial professionals can operationalize sustainability in their day-to-day roles. As organizations mature in ESG, there is a need to integrate sustainability practices within various job functions.

2. Roles Covered:

   • The eight key roles analyzed include: Commercial Lending Representative, Communication Specialist, Financial Advisor, Investment Analyst, Portfolio Manager, Procurement Specialist, Risk Manager, and Software Developer.

3. Challenges and Insights:

   • Integrating ESG into distinct financial roles is challenging due to the varied nature of each job and the need for organization-wide cultural support. Cross-departmental collaboration is essential for ESG success, requiring buy-in from leadership.

4. Structure of Each Role Profile:

   • Each role section includes an overview, essential skills, relevant ESG resources, practical case studies, and a suggested workflow, tailored to help professionals integrate ESG seamlessly.

5. Future of ESG in Finance:

   • As ESG regulations and standards evolve, ESG integration will likely become a routine part of financial roles, reducing the need for specialized guides. Increased systems-level thinking and technology integration are expected to play critical roles in this evolution.

Conclusion: This episode highlights the importance of ESG knowledge across financial roles and the need for practical, role-specific guidance. The paper aims to equip financial professionals with actionable steps to embed sustainability in their daily responsibilities.

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To learn more about ED4S' leadership in ESG training and sustainable solutions, visit our website: https://www.ed4s.org For any inquiries, suggestions, or feedback on the "Sustainability in Motion" podcast, feel free to contact us at: [email protected] About ED4S: At ED4S, we specialize in sustainability-focused workforce training, combining technology and instructional design to deliver custom ESG training solutions tailored for corporations. Our goal is to empower organizations with the skills and knowledge needed to meet sustainability goals, adhere to ESG regulation, and succeed in a competitive business environment. _______________ Transcript:

Hello, everyone, and welcome to the Sustainability in Motion podcast, brought to you by ED4S. We focus on the rapidly evolving world of sustainability to help the business community better understand and address environmental challenges. I'm Matt Orsagh, Chief Content Officer at ED4S.

Maria Maisuradze: Hi, everyone! I'm Maria Maisuradze, Founder and CEO at ED4S.

Nawar Alsaadi: Hello, I'm Nawar Alsaadi, Founder and CEO of Kanata Advisors and Senior Advisor to ED4S.

Matt: Today, we're doing something a little different—we'll be our own guests! We're diving into our recent paper, Operational Sustainability: Eight Role Sheets in Finance. This paper explores what sustainability looks like in practice and how different roles within financial institutions can integrate ESG into their workflows.

So let's jump right in and discuss why we wrote this paper, why we believe it's essential for financial institutions to integrate ESG into traditional roles, and, most importantly, how to do that. Maria, would you like to get us started?

The Journey to ESG Role Integration

Maria: Sure! This paper is part of the journey we've been on since founding ED4S in 2020. Initially, the market was less mature, and most of our focus was on onboarding organizations to the basics of sustainability. We helped financial institutions build a common understanding of what ESG is—and isn't—while exploring risks, opportunities, and investor demand.

Fast forward to today, and we've seen substantial progress. Many organizations now have a baseline understanding of sustainability. However, the question has evolved: How do individuals within various roles operationalize ESG in their day-to-day work?

That's where we saw an opportunity to empower individuals. Not everyone has the bandwidth to take on extra responsibilities, but we wanted to show how sustainability can seamlessly integrate into existing workflows. Our goal was to create actionable, accessible tools—concise role sheets rather than lengthy reports—to help financial professionals lead and grow in their careers while embedding sustainability practices.

Why This Paper is Unique

Matt: That's such a great point, Maria. I wish something like this existed 10 or 15 years ago when I first started in ESG. People often ask, "How do I apply ESG as an analyst, a portfolio manager, or even a software developer?" While there's plenty of general guidance on ESG integration, this paper takes a unique approach by linking ESG directly to the daily workflows of specific financial roles.

Nawar: Exactly. I've never seen a paper like this before. Most resources in this space focus on broad concepts, but our paper bridges the gap between high-level ESG principles and the practical, day-to-day tasks of financial professionals.

Maria: That's true. While there are some resources out there—for example, on integrating climate considerations into certain roles—they often lack the practical perspective needed for financial institutions. Having worked in finance, I could see that many of these guides were written without a deep understanding of the sector's mechanics. Our aim was to address that gap with actionable insights tailored to finance professionals.

Roles Covered in the Paper

Matt: Let's talk about the eight roles we covered and the reasoning behind them. We included:

1. Commercial Lending Representatives
2. Communication Specialists
3. Financial Advisors
4. Investment Analysts
5. Portfolio Managers
6. Procurement Specialists
7. Risk Managers
8. Software Developers

We initially considered 10 roles but decided to set aside HR and accounting for now, as those areas are more complex and require additional research.

Maria: Exactly. HR, for instance, encompasses various responsibilities—from recruitment to employee well-being to incentive structures. Similarly, accounting includes roles in reporting and reconciliation. These roles are crucial, but tackling them would have required a deeper dive, which we hope to do in the future.

Challenges in ESG Integration

Matt: One challenge we faced was the sheer diversity of roles. For example, analysts and portfolio managers share similarities, while communication specialists and software developers operate in completely different worlds. Synthesizing relevant insights without overwhelming readers was a key challenge.

Maria: Another challenge was drawing boundaries. Roles like commercial lending often intersect with others, such as compliance and risk management. Tracing these lines required tough decisions, but collaboration with industry professionals helped us navigate these complexities.

Nawar: I agree. One of the biggest challenges is ensuring this doesn't become a box-ticking exercise. Integrating ESG into workflows requires judgment, collaboration, and motivation—factors we couldn't fully capture in the paper. Additionally, institutions must invest in resources, such as data and tools, to enable their employees to succeed.

Highlighting Key Roles

Matt: Let's share some examples from the paper. I'll start with the Communication Specialist role, which stood out to me because it's often overlooked in ESG discussions.

Marketing and communication teams play a critical role in shaping a firm's ESG narrative. If they lack the necessary training, there's a risk of greenwashing—or even greenhushing. This role sheet provides practical steps for communication specialists to align messaging with ESG principles while collaborating with compliance teams to navigate regional nuances.

Maria: I'll highlight the Commercial Lending Representative role. The business case here is clear: as regulations like carbon taxes increase and clients face pressure to decarbonize, lending reps can engage clients intelligently on transition opportunities. By understanding sustainability-linked loans and subsidies, they can drive efficiency, strengthen client relationships, and create new business opportunities.

Nawar: For me, it's the Portfolio Manager role. One key skill we emphasize is systems-level thinking—understanding the interplay between portfolio components and external systemic risks. ESG integration isn't a one-step process; it's distributed across the workflow. Portfolio managers must collaborate with analysts and other stakeholders to address risks and opportunities holistically.

The Future of ESG Integration

Matt: Looking ahead, what does the future hold for ESG integration in finance?

Maria: I see deeper embedding of ESG across roles as regulations, standards, and sustainable products mature. Technology will play a bigger role, with software developers driving innovation in circular economy solutions and resource-sharing platforms. Financial institutions will increasingly act as connectors, creating value beyond transactions.

Nawar: My hope is that in five to ten years, a paper like this will be redundant because ESG will be fully integrated into all roles as a matter of course. However, the shift requires cultural alignment and the right incentives, which are still evolving.

Matt: I think systems-level thinking will become more prevalent across all roles. Financial professionals will move beyond siloed approaches to understand how their actions impact—and are impacted by—broader systems. Books like Thinking in Systems by Donella Meadows and 21st Century Investing by William Burkhart and Steve Lydenberg provide excellent frameworks for this shift.

Final Thoughts

Maria: I'd like to thank everyone who contributed to this paper. Their insights were invaluable in shaping a practical and impactful resource.

Nawar: Yes, a huge thank you to all the contributors—you know who you are! And for those listening, please read the paper and share your feedback. We'd love to hear how we can improve and address additional roles in the future.

Matt: You can connect with us on LinkedIn or through ed4s.org. Thanks for joining us, and we'll see you next time!

About ED4S

ED4S delivers customizable sustainability workforce training, simulation-based learning, and corporate sustainability programs tailored for financial institutions. Our practical, scalable solutions ensure teams can act confidently on sustainability insights while reducing operational and reputational risk.

Services Include:

• Role-specific eLearning modules

• Simulation-based training for client-facing teams

• Technology and Green AI training

• Live workshops and toolkits

• Continuous content updates and compliance assurance

ED4S empowers organizations to embed sustainability across their workforce and transform sustainability literacy into measurable business value.

To learn more, visit https://www.ed4s.org/

Sustainability in Motion Podcast – Episode: Sustainable Stock Exchanges Initiative

Hosts:

• Matt Orsagh, Chief Content Officer at ED4S
• Maria Maisuradze, Founder and CEO at ED4S

Guests:

• Tiffany Grabski, Head of SSE Academy
• Anthony Miller, Coordinator of the Sustainable Stock Exchange (SSE) Initiative

Episode Focus: This episode explores the Sustainable Stock Exchanges (SSE) initiative's role in advancing sustainable finance and how the SSE Academy supports education and training in sustainability for exchanges and market participants globally.

Key Takeaways:

1. Overview of SSE and SSE Academy

   • Launched in 2009 by the UN, the SSE works with over 130 stock exchanges worldwide to promote sustainable finance. The SSE Academy provides free market education to help exchanges and market participants understand and implement sustainability practices.

2. Mandatory ESG Disclosure and Reporting Trends

   • There is a global trend towards mandatory ESG disclosure, with 38 markets now requiring sustainability reporting. Many exchanges align their requirements with standards like IFRS, GRI, and the European Sustainability Reporting Standards (ESRS), streamlining ESG reporting globally.

3. Consolidation and Alignment of Standards

   • The IFRS Foundation's integration of climate and sustainability reporting standards helps companies reduce the "alphabet soup" of ESG requirements. This consolidation supports global alignment, enabling companies to navigate sustainability reporting more effectively.

4. The Role of Exchanges in Capacity Building

   • Stock exchanges are uniquely positioned to promote sustainable practices through market education. The SSE Academy has trained over 30,000 participants globally, helping exchanges meet sustainability demands without additional costs.

5. Challenges and Opportunities in Listing

   • While listing is complex and resource-intensive, exchanges provide guidance to help companies meet ESG expectations. The SSE offers tools and guidance on ESG best practices, benefiting listed and private companies that engage with listed entities.

Conclusion: The SSE initiative plays a crucial role in advancing sustainable finance by building capacity, aligning standards, and reducing barriers to ESG compliance, helping stock exchanges worldwide to promote sustainable practices effectively.

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Welcome to the Sustainability in Motion Podcast!

Matt Orsagh: Hey, everyone! Welcome to the Sustainability in Motion podcast, brought to you by ED4S. We focus on the fast-moving world of sustainability to help the business community better understand and address the environmental challenges we face. I'm Matt Orsagh, Chief Content Officer at ED4S.

Maria Maisuradze: Hi, everyone! I'm Maria Maisuradze, Founder and CEO of ED4S. It's great to be with you today.

Matt: Today, we're talking with Tiffany Grabski, Head of the SSE Academy, and Anthony Miller, Coordinator of the Sustainable Stock Exchanges (SSE) Initiative. We'll discuss the work of the SSE and its Academy in promoting sustainable development.

Tiffany, Anthony, welcome to the podcast!

Anthony Miller: Thanks for having us, Matt.

Tiffany Grabski: Great to be here!

What is the SSE and SSE Academy?

Matt: To kick things off, can you explain what the SSE and the SSE Academy are, and how they promote sustainable development?

Anthony: Sure, Matt. The Sustainable Stock Exchanges (SSE) Initiative was launched in 2009 by the UN Secretary-General. Think of it as a sibling initiative to others like the UN Global Compact, which works with companies, the Principles for Responsible Investment (PRI) with asset managers, and UNEP FI with banks and insurers. Stock exchanges didn't fit into any of these categories, so the SSE was created to fill that gap.

The SSE is a partnership program involving the Global Compact, PRI, and UNEP FI. We work with stock exchanges because they occupy a unique position in the market, sitting at the intersection of issuers, investors, regulators, and standard-setters. This gives them a powerful role in influencing market practices to promote sustainable finance and the UN's Sustainable Development Goals (SDGs).

As for the SSE Academy, it's our market education arm. Stock exchanges have always provided market education because being a listed company is complex—there are compliance rules, financial accounting standards, and governance requirements to follow. The Academy helps exchanges incorporate sustainability priorities into their existing education programs. With over 130 exchanges in our network, many don't have in-house expertise on every sustainability issue, particularly in emerging markets. The SSE Academy helps bridge that gap by providing universal, standardized training accessible to all members.

Growth of the SSE Initiative

Matt: That's fascinating. You mentioned the SSE started in 2009. How many exchanges were involved at first, and how has it grown?

Anthony: We began with just five founding exchanges. Growth was gradual at first but picked up momentum as exchanges recognized the importance of sustainable finance. Today, most of the world's stock exchanges are SSE members, representing over 100 markets globally.

Exchanges are uniquely positioned to respond to societal and market pressures, such as investor demand for sustainable finance products. This demand, combined with exchanges' willingness to innovate, has driven our expansion.

The Role of Stock Exchanges in Promoting ESG

Maria: I discovered the SSE Initiative last year and was struck by the critical role stock exchanges play in sustainability. Listing on a stock exchange essentially provides companies with a license to access significant capital. Some exchanges even require ESG disclosures as part of their listing criteria.

I read that 38 exchanges globally now mandate ESG disclosure. Could you share more about the types of disclosures required and any trends you've observed?

Anthony: That's a great question, Maria. We track mandatory ESG disclosure requirements across our online database, which is the most comprehensive in the world. Ten years ago, very few markets mandated ESG disclosure—today, 38 do.

The specifics vary. Earlier rules were more general, asking for sustainability reports without detailed guidelines. Over time, rules have become more precise. For example, the EU now requires disclosures aligned with the European Sustainability Reporting Standards (ESRS), which cover environmental and social issues comprehensively.

Globally, there's a trend toward adopting international standards. The three major frameworks gaining traction are GRI, IFRS S1 and S2, and ESRS. These frameworks are aligning markets worldwide, creating consistency and reducing confusion for companies.

Impact of Consolidating Standards

Matt: How does the consolidation of standards like IFRS S1 and S2 affect your work at the SSE Academy and the broader markets?

Tiffany: Consolidation is a game-changer. Many of these standards aren't new—they build on existing frameworks like GRI, TCFD, and others. By bringing them together, we're addressing the long-standing "alphabet soup" problem that left companies unsure where to start.

This alignment simplifies reporting and forces internal collaboration within organizations. Sustainability reporting is no longer siloed; it involves multiple departments working together, which enhances the quality and value of the data.

At the SSE Academy, we focus on educating market participants about these consolidated standards. This education is critical because compliance isn't just a regulatory checkbox—it's about creating real value.

Capacity Building Through the SSE Academy

Maria: Capacity building is close to our hearts at ED4S. Could you share more about the SSE Academy's training programs, the topics covered, and who participates?

Tiffany: The SSE Academy launched in 2021 in response to demand from exchanges. Our first program focused on TCFD, and since then, we've expanded to topics like IFRS S1 and S2, GRI, gender equality, and biodiversity through TNFD.

To date, we've trained over 30,000 market participants from 145 countries through 160 workshops and nearly 400 hours of training. These workshops are hosted by exchanges and are free for their stakeholders, ensuring accessibility.

Challenges for Private Companies and Capacity Building

Maria: Many companies stay private to avoid the complexities of listing, and sustainability reporting might seem like an additional burden. Do you think regulations like ESRS, which apply to private and public companies, level the playing field?

Tiffany: Absolutely. Whether listed or private, companies are part of value chains that demand sustainability data. Non-compliance could limit market opportunities.

Listing remains an excellent way to raise capital and gain protections, especially when disclosures are required by regulation. These regulations provide clarity, reduce greenwashing risks, and encourage transparency.

Other Tools Provided by the SSE

Matt: What other tools and resources does the SSE offer its members?

Anthony: We operate on three pillars: consensus building, research and normative guidance, and technical assistance.

1. Consensus Building: We host high-level CEO roundtables and multi-stakeholder meetings to align exchanges, regulators, investors, and issuers.

2. Normative Guidance: We develop best practice guides on topics like green finance, gender equality, and climate disclosure.

3. Technical Assistance: This includes model guidance templates that exchanges can adapt to their markets. For example, many exchanges start with voluntary ESG guidelines and later transition to mandatory rules.

We also track progress through benchmarking and data-driven publications. Our work is demand-driven, based on the real-world needs of exchanges.

Matt: That's incredible work. Tiffany and Anthony, thank you for joining us and sharing such valuable insights.

Tiffany: Thanks for having us!

Anthony: It was a pleasure.

Matt: To our listeners, if you'd like to connect, we're all available on LinkedIn or through ed4s.org. Thanks for tuning in, and we'll see you next time!