Sustainable Finance: when finance becomes a strategic lever for a sustainable future

In recent years, sustainable finance has become an increasingly central topic in economic and social debate, not only in academia but also among businesses, investors, and policymakers. This is not just a passing fad or a green label to be applied to traditional activities: sustainable finance is now one of the key tools for guiding the transition to a fairer, more resilient, and environmentally friendly economy. At the same time, it represents both a collective responsibility and a concrete opportunity to create value in the medium to long term. 

But what does sustainable finance really mean? How are Italian companies addressing this transformation? And what role do corporate purpose and training in specialised skills play in this scenario?
We discussed this with Giancarlo Giudici, Director of the Professional Certificate in ESG Analysis & Investing and the Executive Course in Corporate Finance: Capital Raising and  Securities Market Operations.

What is meant by sustainable finance and what corporate initiatives and actions that fall under this concept today? What practices should be considered?

The concept of sustainable finance is quite simple in its formulation, but extremely profound in its practical implications: it involves consideration in financial decisions – by both firms seeking capital, and by investors, who make that capital available – not only of traditional metrics, such as risk, return, and cash flow, but also of sustainability criteria. It is thus a form of finance that integrates ESG parameters – Environmental, Social, and Governance – into resource allocation strategies and risk and opportunity assessments.

At the policy level, one of the most important references to this concept is the 2018 European Action Plan on Sustainable Finance, a real turning point that defined the European agenda on the subject, dividing it into ten strategic actions. This plan has laid the foundations for major EU legislative initiatives in this area and provided a strong impetus to businesses and financial operators to move towards greater transparency, accountability and consistency with sustainability objectives.

One of the most important corporate actions in this regard is non-financial reporting. Today, in addition to traditional economic and financial reports, businesses must provide clear, comparable, and auditable data on their ESG performance. This allows investors to assess and compare companies not only in terms of profitability, but also in terms of environmental, social and governance impact. Reporting is also crucial for monitoring progress over time, assessing whether and how much businesses are improving with respect to their sustainable goals.

A second pillar concerns the orientation of investment towards the ecological and social transition. Achieving the goals of the Paris Agreement or the UN’s 2030 Agenda, for example, is not possible without significant investment. Switching to renewables, reducing emissions, closing the gender pay gap or investing in worker safety and training requires capital. In this sense, finance plays a key role in supporting projects that have a concrete positive impact.

Another key aspect is regulation: Europe has introduced specific rules to oblige banks, investment funds, and financial advisors to be transparent about how they integrate ESG criteria into their decisions. This is to counter the risk of greenwashing, i.e. the tendency to attribute a sustainable image to practices that are not, in fact, sustainable.

Finally, it is important to underline the evolution of investors, who are increasingly active in this scenario: they do not just monitor sustainability metrics but are intervening directly to guide corporate strategies. We’re talking about engagement and stewardship, approaches where investors engage with their investee companies, propose improvement measures, and – if necessary – vote at shareholders’ meetings against decisions that do not reflect sustainability principles, such as excessive compensation for directors. In this sense, they too become real agents of change.

How advanced is the Italian business landscape today in implementing concrete sustainable finance initiatives? And to what extent do these actions generate value – economic, social and environmental – for the companies that implement them?

The Italian landscape is still quite heterogeneous. Large companies, especially listed ones, are generally more advanced. They have direct access to the capital market, engage with institutional investors, and are often subject to stringent regulatory requirements. For them, adopting sustainable finance practices is also a way of enhancing their reputation, attracting investment, and meeting the expectations of increasingly informed stakeholders.

The situation changes when we look at the majority of Italian companies, which are small and medium-sized, unlisted, and heavily dependent on bank credit. In these cases, the relationship with sustainable finance is more indirect, but it is becoming increasingly relevant. This is partly due to the role of banks, which – under European regulations and the requirements imposed by the ECB – are now required to integrate ESG criteria into their risk assessment models and credit decisions. In this sense, a company that demonstrates a positive impact in terms of sustainability can obtain financing more easily and, in some cases, on more favourable terms.

Implementing sustainable practices, therefore, is not just a matter of compliance or reputation, but a real lever for improving access to capital. And this translates into value. While costs may appear higher in the short term – think of investments in energy efficiency, renewables, training, or safety – in the medium to long term, the benefits are clear. Sustainable businesses attract more talent, enjoy greater trust from customers and investors, and are better able to manage risk and ensure greater resilience.

From a financial point of view, there is no evidence that sustainability implies a penalty in terms of return. On the contrary, many studies show that firms with strong ESG profiles can generate similar or even superior performance compared to less sustainable ones. This means that for an investor, choosing sustainable companies does not mean sacrificing profitability, but can actually be an effective long-term strategy.

In this scenario, how important is it to have a defined Purpose to undertake effective sustainable finance initiatives, and how can we train competent professionals in this area? What are POLIMI Graduate School of Management’s approach and educational offer in this regard?

Having a clear Purpose is the starting point. It defines why an organisation does what it does, beyond profit generation. It is an  element of identity, but also an operational one: it guides strategies, directs decisions, and inspires action. A solid Purpose makes a commitment to sustainability more credible and consistent. Without a genuine and shared vision, initiatives risk being fragmented or, worse still, perceived as opportunistic.

Alongside Purpose, however, we need skills. Sustainable finance requires specialised training that combines economic and financial knowledge with environmental, social and regulatory sensitivity. At POLIMI Graduate School of Management, we have developed two separate programmes to meet this training need.

The first is the Professional Certificate in ESG Analysis & Investing, developed in collaboration with the CFA Society Italy. It is a highly regarded programme, one of the most popular at our School, aimed primarily at financial analysts, fund managers, consultants, and asset management professionals. It is structured in 15 modules and accredited by the EFPA (European Financial Planning Association): those who complete it can take the exam to become an ESG Advisor, a role increasingly in demand in the market.

The second is the Executive Programme in Finance, designed for managers and professionals who do not come from the world of finance but who have to make financial decisions within their organisations. It is divided into eight modules, plus two optional ones, and offers a comprehensive overview of topics such as financial planning, corporate finance, securities issuance and extraordinary transactions, with a concrete and operational focus.