WFE launches Principles for Sustainable Exchanges

Panelists at WFE AGM launch new Principles for Sustainable Exchanges. From left to right: Alex Matturri, CEO, S&P DJI; Nicky Newton-King, CEO, JSE, Laura Cha, Chair, HKEX; James Zhan, Chair, SSE; Robert Scharfe, CEO, LuxSE.

(4 October 2018) The World Federation of Exchanges has formally launched its “Principles for Sustainable Exchanges at the WFE Annual Meeting in Athens. These principles mark a major milestone in the evolution of WFE members’ engagement with sustainability. With the launch of these new principles, WFE member exchanges formally acknowledge their role in fostering and promoting the development of a sustainable financial system, making finance flows consistent with a pathway towards low greenhouse gas emissions and climate-resilient development, and promoting the transition towards an inclusive, and sustainable economy.

“As the global industry body for exchanges, the WFE’s new Principles for Sustainable Exchanges make clear that sustainability is the new ‘business as usual’ for exchanges. This is a significant step forward, from an era 10 years ago when sustainability was seen by some as ‘nice to have’ but not ‘need to have’,” said James Zhan, Director of Investment and Enterprise at UNCTAD and Chair of the SSE’s Governing Board. “Of course, the key thing is to put principles into action. The SSE will continue to work with exchanges to help them translate these principles into concrete actions.”

The principles include education of market participants, promotion of ESG disclosures, multi-stakeholder engagement for sustainable finance, provision of markets and products, and establishing effective internal governance in support of sustainability efforts. The WFE encourages all exchanges to use these principles as the baseline for the development of their market-specific initiatives.

The principles are accompanied by a list of sustainable finance initiatives, including the SSE, in order that member exchanges might know where to find information and guidance to help them adhere to the principles. The SSE has published guidance for exchanges on ESG disclosure, gender equality and green finance.   

Exchange support for the SSE was credited by the WFE as evidence of how stock exchanges have already acknowledged their role as an important vector in the sustainability transition. Launched in 2009 by the UN Secretary General, the SSE today has 78 Partner Exchanges who have made a public commitment to promote sustainability practices in their markets.

“We’re very proud of the SSE’s role over the past decade in helping to forge consensus among exchanges on sustainability issues. Now that the main industry body for exchanges has taken a clear and formal stance on this issue, we think going forward there will be a bigger role for policy makers and securities regulators in the sustainable finance space,” Mr. Zhan added.


About the Sustainable Stock Exchanges initiative

The SSE provides a peer-to-peer learning platform for exploring how exchanges—in collaboration with investors, regulators, and companies—can encourage sustainable investment and enhance corporate transparency, and ultimately performance, on ESG (environmental, social and corporate governance) issues. The SSE is a United Nations Partnership Programme convened by the UN Conference on Trade and Development (UNCTAD), the UN Global Compact, the UN Environment Finance Initiative (UNEP FI), and the Principles for Responsible Investment (PRI). For more information on specific exchanges’ sustainability efforts, how to become a Partner Stock Exchange, and further opportunities to advance the integration of sustainability within capital markets, visit www.sseinitiative.org

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