The Deep Transitions Newsletter puts one member of the Global Investors Panel in the spotlight each month. Issue #5 of our newsletter features Atanas Kolev who is Principal Advisor in the Economics Department of the European Investment Bank and coordinator and reviewer of the EIB annual investment report. He joined EIB in 2005 and has worked on a wide range of topics, including investment in the energy sector, adaptation to climate change, government investment, infrastructure investment and economic and social cohesion. We asked Atanas why he decided to join the Global Investors Panel, where he sees the biggest challenges in sustainable finance at the moment and what the success of the project would look like for him.
Why did you decide to join the Global Investors Panel?
“Over the past fifteen years, I have worked on many sustainability-related problems as an economist. I have tackled diverse issues ranging from investment in climate change mitigation and adaptation to economic and social cohesion. This has often made me think about the ways in which we can change our lives and society to ensure that we leave a better place for the next generations. Clearly today, this is not an easy task and requires many changes in fundamental systems that underpin our lives and society. The scale of such changes is so large that sometimes it all seems like science fiction to me. Joining the Global Investors Panel provided me with an opportunity to think and discuss with a diverse interdisciplinary group of experts about the pathways to a better future. All this is done in a very structured and organized fashion and with a promise that I can enrich my views. I was excited to hear how people with other backgrounds, experiences and expertise think about sustainability and societal transformation.”
What would you say are the biggest challenges in sustainable finance?
“Currently, sustainable finance is in its infancy despite impressive growth and development in recent years. The most fundamental problem that I see is that, due to the very nature of many sustainable projects, their return to society is higher than the private return that an investor might earn. As a result, not enough money goes into sustainable finance from a social point of view. That said, there are many investors, who are willing to invest in sustainable projects despite the problem with potentially lower returns. A big challenge for them is that it is not always clear which projects can be considered sustainable. There is not enough publicly available, standardized information to help investors navigate through investment opportunities. Yet another challenge is that financial intermediation, and banks, in particular, have not yet truly embraced sustainable finance. The good news is that policymakers have the tools to address these challenges and we have strong signals that, at least in Europe, they are heading in the right direction.”
What does the success of Deep Transitions Futures and the work with the Panel look like for you?
“In my view, the project is very ambitious both as an academic endeavour and as a way of informing policy and business. On the academic side, I hope it will draw more resources and spur more research. On the other side, by involving people outside of academia and reaching out to the general public, I hope that the project will raise awareness about the scale and scope of the change we need to carry out in order to make sure that our lives and those of the next generations are put on a sustainable path. On a personal level, I hope it will enrich the way I think about sustainability and societal transformation.”