Countries ‘must change short-termism mindset’

27 Apr 18

Countries should look to long-term investments for sustainable development and change their mindset from “short-termism”, United Nation officials have said.

The UN will also support countries’ path to sustainable development by brokering partnerships, pursuing innovative finance, leveraging resources and building capacity, the officials said on Monday, at the development financing forum in New York.

Deputy secretary-general Amina Mohammed called for a global economic environment more supportive of long-term investments.

She said: “Short-termism is a persistent threat to successful poverty eradication efforts.

“This mindset needs to change.”

She also called for the international community to find ways to unlock resources and access to finance for countries with “urgent needs”, such as those affected by crisis or disaster.

Secretary-general said at the forum: “Above all, sustainable, inclusive development, deeply rooted in respect for all human rights – economic, social, cultural, civil and political – is the world’s best preventive tool against violent conflict and instability.

“I will count on world leaders and all of you to invest in a sustainable and prosperous future for all.”

To achieve the universal access to clean water and sanitation, there is a need to triple the amount spent to around $113bn per year, Mohammed said. 

General assembly president Miroslav Lajčák said that the investment gap in developing countries alone is some $2.5trn per year for major SDG sectors.

He said: “But we cannot aim to just throw money at the problem. Instead we must have a strategic and targeted approach.”

Marie Chatardová, United Nations Economic and Social Council president, said one of the greatest challenge policymakers face in raising resources for sustainable development is excessive short-term decision-making in the private sector as managers’ compensation is often tied to short-term performance measures and benchmarks.

But “an increasing number of asset managers and owners have committed to integrate ESG criteria in their capital allocation process,” she said, referring to environmental, social and governance indicators that have a material impact on returns.

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