How can sustainable finance support real change?

Kate Symons - 01/04/26

Author:  Trang Do – PhD Candidate, Finance Department, University of St Andrews Business School

The Finance Department at the University of St Andrews Business School and the Centre for Responsible Banking and Finance (CRBF), in collaboration with Scotland Beyond Net Zero and with support from the St Andrews Centre for Critical Sustainabilities, hosted its Sustainable Finance Symposium on 18 March 2026 as part of the University’s Sustainability Week.

Following a keynote by Ralph De Haas (European Bank for Reconstruction and Development), the day featured research presentations from academics across the UK and Europe. The afternoon continued with a poster session showcasing early-career researchers, and concluded with a policy panel bringing together academics and practitioners.

From Commitments to Impacts: How Sustainable Finance Is Reshaping Real Decisions

What stood out to me across the research presentations was a clear shift in focus: from whether sustainable finance is growing to whether it is actually changing real economic behaviour.

Ralph De Haas set the tone by challenging the common scepticism about banks’ voluntary climate commitments. His keynote showed that these commitments are meaningfully associated with greener lending practices in emerging markets, and, importantly, that firms borrowing from such banks are more likely to undertake green investments themselves. The message was both simple and powerful: bank commitments are translating into real economic outcomes.

Firms Don’t Just React – They Reorganise

Huyen Nguyen (King’s College London) presented evidence on how firms respond to biodiversity transition risk. Firms hire less in high-risk areas, reallocate jobs geographically, and shift toward compliance and environmental roles. What I found particularly interesting is that adjustment does not happen through sharp exits, but through gradual reorganisation in response to uncertainty.

Climate Risk Is Being Repriced – But Policy Still Matters

Oliver Rehbein (WU Wien) showed that banks do reprice climate risk after disasters, but not in isolation. Where governments implement resilience measures, borrowing costs fall. This reinforced an important point for me: climate risk pricing is co-shaped by markets and policy rather than driven solely by financial markets.

When Politics Shapes Preferences

Stefano Ramelli (University of St Gallen) added a behavioural dimension by examining how political context shapes sustainable investing. When climate policy is perceived as weak, investors lean more on ethical motives; when it is supportive, financial considerations regain prominence. This was a useful reminder that investor demand for green assets does respond to the political environment.

A Common Thread: Quiet but Systemic Effects

Across the presentations, what I found most compelling was the consistent emphasis that sustainable finance works through gradual, system-wide adjustments rather than dramatic shifts. Its impact lies in quietly reshaping incentives, expectations, and decisions across market participants. As the saying goes, this is “a journey, not a destination” – a fitting reflection of how these changes unfold over time.

From Ambition to Implementation: A Practitioner’s View

The policy panel, “Making Sustainable Finance Work in Practice: A Scottish Perspective,” moderated by Dimitris Andriosopoulos (University of Strathclyde), with panellists Di Luo (University of Dundee), Stefanie O’Gorman (Ramboll), Simon Thompson, and Claire Wallace-Jones (Barclays), brought these themes into a real-world context.

Beyond the ESG Hype

A key takeaway was that sustainable finance has moved beyond its initial hype phase. As several panellists noted, the sector is now in a “hard implementation phase.” The current focus is on execution: developing transition plans, embedding climate considerations into decision-making, and directing capital toward projects with measurable impact.

Scotland: Strong Foundations, Structural Frictions

In the Scottish context, the discussion highlighted strong capabilities and a well-developed financial sector. However, what stayed with me was the emphasis that the main constraint is not capital, but the shortage of investable projects. Bridging this gap between available finance and viable projects remains a central challenge.

A System in Transition

In line with the research presentations, the panel reinforced the idea that sustainable finance is undergoing a gradual but meaningful transition. One point I found particularly insightful was the emphasis on localisation and collaboration – especially the role of universities, industry, and policymakers working together to develop solutions tailored to regional contexts.

The symposium was organised by Dr Eleonora Sfrappini (Lecturer in Finance), with support from Dr Maria Chiara Iannino and Dr Karishma Ansaram from Scotland Beyond Net Zero.