Apr 29, 2020

Nudging the Financial System: A Network Analysis Approach

Nudging the Financial System: A Network Analysis Approach

Published: UNEP Inquiry and FC4S

Author: Marcos Mancini

This paper is a first attempt to improve the understanding of the sustainable finance ecosystem, its partnerships, actors and emerging network characteristics related to the implementation of the 2030 Agenda for Sustainable Development and its 17 Sustainable Development Goals (SDGs).

Network analyses of these diverse arrays of sustainable finance partnerships are deemed relevant for the alignment and cascading of sustainable finance into the wider financial system. The current sustainable finance network is composed of 115 different “partnerships”,

5,181 constituent members and more than 10,000 connections. Based on network analytics, this paper shows that 74.6% of the network is connected to only one partnership and only 13.3% of the network constituents are connected to three or more other partnerships. This means that a small number of constituents have a high number of connections to the different partnerships and a high number of constituents have a low number of connections.

The analysis also shows that the network is rather small, as the length of the path from any two different network participants is 3.67 on average, any constituent in the network is at less than four degrees of separation from anyone else. This just highlights the role that international organizations with a broad geographic presence such as UNDP or multilateral development banks can play to convene and connect, facilitate and scale up the reach and impact of the current sustainable finance network.