Global Investors for Sustainable Development Alliance

Incentivizing Long-termism in Investments

The financial markets have a short-term orientation and private investors have long avoided developing markets due to impediments such as a perception of high risk, low returns, currency volatility and regulatory constraints. These long-standing market dynamics have curtailed impactful long-term investment.

To shift to long-termism within the finance sector, incentives within the investment chain need to be revised. In the below paper, the GISD Alliance has identified actions and issued recommendations that can provide impetus for long-termism across the financial sector.