A Mandate...
COP27 President called for:
"a transformation of the financial system and its structures and processes"
Facing up to the Polycrisis
Addressing today’s crises requires major change. Finance holds a unique power to direct resources, attention, and energy. However, the systems driving finance often reflect deeply ingrained values and assumptions that go unchallenged. These systems contribute to today’s challenges and hinder the allocation of resources at the scale needed for solutions. To address this, FEST is accelerating the development of the field of Financing Systemic Transformation (FST).
To create real change, transformation agents must tackle four key elements:
- Complexity: Systems involve many interconnected parts.
- Long-term Vision: Transformations require at least a decade.
- Scale: Reaching vast geographies and multiple stakeholders.
- Internal Change: Shifting mindsets and mental models.
FEST focuses on enabling finance to support large-scale systems change. This requires transforming both the investors and those using capital to reflect new values and relationships. Over time, this could reshape the broader finance system.
The Current State of The Field of FST
The field of FST is fragmented, with many small-scale efforts led by charismatic leaders using diverse terms. There are huge funding shortfalls, and efforts in many cases are being undermined by the tranditional finance institutions and structures. Nonetheless, the islands of hope and activitiy exist.
Looking at the innovation-adoption curve (below), FEST is moving the field from innovators and early adopters to the early majority—those who will embrace change, if it’s made simple. This transition requires crossing the "chasm" by developing shared language and easily implemented actions. Innovators and early adopters must embrace a larger vision.
It is clear that the current financial system is not designed to carry out the changes that are necessary. Adhoc innovations, such as carbon credits, blue/nature bonds, impact investing, measurements, tech platforms, and social stock markets, require a whole system approach and in many cases a transformational reorientation if they are to be successful in their efforts.
This is the work of FEST.
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