Distinguished Ladies and Gentlemen—as we typically say to start UN convenings to acknowledge the various time zones—good morning, good afternoon and good evening.

First and foremost, let me extend a note of thanks to the Yale School of Management’s Program on Social Enterprise for this extraordinary opportunity to address all of you today. I want to extend a particular note of thanks to Tony Sheldon, not only for this opportunity but for being such a wonderful colleague of mine over the years.

Let me also extend my appreciation to all of you in attendance, notably the stakeholders who are driven by the desire to make capital work for humanity and not the other way around. For the last few years, we have all heard the conversation around the paradigm shift from shareholder capitalism to stakeholder capitalism. Of course, one announcement or one declaration is far from enough. It takes many conversations that result in collaboration, which leads to planning, which ends in execution and results. So, I thank all of you for displaying the resilience that is required to enact this paradigm shift. It is not an easy task but it is a worthy one. And all of you display exemplary leadership in carrying it forward.

As for all of the students in attendance today, I would like to extend an important message, one that you have probably heard repeatedly: This world needs you—all of you. The scale and complexity of the world’s challenges requires the inventiveness, the savvy, and the moral compass that all of you possess. My hope is that all of you will respond to this call, in one way or another. I also hope that after hearing my remarks, you will experience a sense of optimism and confidence in your ability to support transformative change in our time. And selfishly, I hope that many of you will look to start your impactful careers with the United Nations generally and the UN Capital Development Fund in particular.

I would also like to take a moment to express my gratitude and my awe for receiving this alumni award. Attending and graduating from Yale School of Management was more than a stop on my professional journey. It was an absolute inflection point. It was where I discovered my personal and professional mission to help guide the world on a path where capital is supporting humanity and not the other way around. But discovering this mission only took me so far. I would need to acquire the skills, develop the networks, and outline the path to embark on this personal and professional mission. In this regard, the School of Management played a fundamental role in equipping me for the mission I chose to embark upon. There is still plenty of work left to do, but this work still drives my passion and efforts. So, once again, thank you for this remarkable honor.

To begin my remarks, I would like to start by discussing two business stories. One you are probably aware of. The other, probably less so.

I am sure that many of you read a piece that recently appeared in The Wall Street Journal bearing the remarkable title: The SPAC Ship Is Sinking. Investors Want Their Money Back. The title of the piece tells the story. At one point, SPACs or special purpose acquisition companies were among the hottest investments in capital markets, namely because of their capability to raise prospective financing for companies in similar fashion to IPOs while bypassing the typical IPO process and disclosures. What was once an extremely hot ticket item is now substantially less so. New oversight measures are making SPACs less attractive as an investment.

Let me offer another example involving a separate company UNCDF is supporting with capital financing. This story involves a company named Mwezi. Mwezi is a last-mile solar energy solutions distributor targeting rural Kenya. The company leverages a Pay-As-You-Go or PayGo model to make it easier for low-income households in rural sub-Saharan Africa to afford Mwezi’s clean energy products. Last year, through our third-party managed impact investment fund, Mwezi received a 500,000 dollar working capital facility that it will use to drive its expansion into solar productive products and solar agri-business products in Kenya, as well as neighboring LDCs, including Uganda, Ethiopia and Rwanda. Said simply, one 500,000 dollar investment is going to support the expansion of clean energy access and financial inclusion in the markets where these needs are significant.

While this is a great story for Mwezi; for our investment partner, Bamboo Capital Partners; and for UNCDF; it is not a great story for the global financial architecture. If I can reduce the demonstrable challenges of the global financial architecture to a simple problem statement it would be this: The chances are remarkably higher that a SPAC, or an NFT, or a stock buyback can generate 50 million or 500 million in the capital markets than they are for an Mwezi acquiring the frankly small sum of 500,000 dollars.

In fact, when it comes to investments in the markets UNCDF is primarily focused on—the world’s 46 least developed countries, which represent the frontier and growth markets of the future—the cost of achieving scale for these countries typically ranges from 250,000 dollars to 2 million dollars. An absolute pittance when considering the total value of global assets is approaching 500 trillion dollars and may reach a quadrillion-dollars by the year 2025; on top of private equity assets currently in the range of 4 trillion dollars.

Given the audience we have here in attendance, I can safely say that all of us here know precisely what global financial architecture we have. It is an architecture that finances environmental degradation over nature conservation; income inequality over economic resilience; and corporate consolidation over the proliferation and successful global value chain integration of SMEs.

But much more importantly, and this is a point that cannot be overstated, it is an architecture that facilitates the demise of the necessary elements of sustainable capitalism, much less sustainable development—natural resources, resilient local economies, and, said simply, workers and customers with the income to spend.

To the point, we have a global financial architecture that is very good at financing market failures versus starving market failures. And for the purposes of my remarks today, I am using the term “market failure” in the way that it was introduced roughly 65 years ago by the Harvard University professor and White House Economist Francis Michael Bator. He defined the term as QUOTE “the failure of a more or less idealized system of price-market institutions to sustain ‘desirable’ activities or to stop ‘undesirable’ activities.” UNQUOTE

Perhaps one of the most disturbing aspects of the current architecture is that a new kind of market failure is taking shape—what all of us would refer to as greenwashing—where investments marketed to finance ESG or SDG friendly investments also end up supporting the very ventures that contradict the most basic elements of development finance.

The reality is that there is a gargantuan misperception at the core of the current global financial architecture. It is the misperception of commercial return-driven investment being classified as standard, institutional, traditional investment. More specifically, investments that are, at the very least, development-agnostic are widely considered as—remarkably—mainstream.

Conversely, investment that is primarily focused, though not necessarily entirely focused, on development impact, are seen as non-mainstream or alternative. Perhaps the clearest evidence is in the terminology we use. Commercial investments, for the most part, do not rely on qualifiers for descriptive purposes. But in the impact world, the qualifiers are all around us—development finance as opposed to finance; impact investment as opposed to investment; and when you want an investment that delivers commercial and development returns, the outcome is described as the double bottom line, the second return being the non-commercial one, of course.

To be fair, there are promising examples of the kind of investment tools that truly deliver on development. We have GAVI vaccine bonds, which converts official development assistance into vaccine bonds on capital markets. Impact bonds that have financed the education of young girls in underdeveloped areas as well as the preservation of endangered species, namely rhinos. And, of course, UNCDF has a whole suite of investment tools that are delivering finance to projects that have commercial and development potential—including our blended finance investment funds—which I will share later on in my remarks. But, unfortunately, many of these tools have yet to reach global scale. And the misperception challenge continues to exist.

And the reason this powerful misperception exists is because of the significant structural challenges that are tied to the very nature of the global finance architecture:

Namely, the inability of capital markets to reflect the true price of externalities; whether it is pricing down the negative externalities of environmental degradation or socioeconomic harm, or pricing up the positive externalities like climate adaptation, financial inclusion or women’s economic empowerment.

Or, the lack of a financial regulatory architecture where companies would have to report on their positive and negative SDG or ESG impacts in the same way that they have to report their audited income and cash flows.

Or, the lack of innovative capital markets for development, which can raise financing for projects that deliver on both SDG achievement and commercial return on investment, notably to capitalize promising, innovative SMEs.

The end result? Market failure finance is mainstream. Sustainable development finance is alternative, or dare I say, radical. And because market failure finance is considered mainstream, all of its associated market failures are then used by many as an indictment against capitalism as a whole.

So, if I can repurpose a well-worn and well-known concept, what we are witnessing is nothing short than the Defining Down of Capitalism, at least in the eyes of so many people in the world today.

This is particularly dangerous considering the necessity of private capital to fill the SDG financing gap. Consider that we just witnessed a record high for global Official Development Assistance deployed, which was a little over $161 billion dollars. This is, of course, a fraction of the global SDG financing gap of $3 to $5 trillion dollars.

Hence, the dilemma we are facing. The existance of a global financial architecture that finances market failures, resulting in the Defining Down of Capitalism. But there is no path to achieving sustainable development without the private capital that can be best mobilized by capitalism itself through the global financial architecture.

Ultimately, if capitalism has been defined down, then the question is, how can we Define Capital Up? Much more importantly, how can we arrive at a global financial architecture that will serve as the critical agent for sustainable development, versus a significant hindrance. And, given the position I hold, what is the role that the UN can play in this regard?

This is where we need to acknowledge an important and uplifting reality—that we have actually seen this before. We have seen instances where the global financial architecture has delivered on the development needs of the world—instances where the UN played a significant and irreplaceable role. And we would see capitalism defined up in the process. To bring this point to life, I would like to share three narratives—three narratives about how the UN has played this role, and will continue to play this role of defining capitalism up.

The first narrative starts with the rise of the global rules-based order, which was spawned after the end of World War II. In this case, it is important to remember what global markets looked like before the rise of this new order.

Global market actions were determined by nations, with companies acting as proxies. Nations used global commerce to participate in a zero-sum race for capital, resources and land. This pursuit for global commerce was undergirded by beggar-thy-neighbor policies around trade that was nothing short of economic nihilism in the guise of domestic protectionism. It was a capitalism that undervalued human capital, natural capital, and development capital in favor of financial capital, political capital, and global capital. And it supported precisely the conditions that spurred great power wars—so much so that great power wars were simply accepted as a consequence of global politics.

We should all remember that we are less than 100 years from a global financial architecture that could be described in one harrowing way—mercantilist.

But after World War II, there was the recognition that such a system was simply not sustainable—politically, economically or humanistically. We needed a trade architecture that allowed for both the free flow of goods and the cooperation of nations. We needed a financial architecture that supported global markets and not global empires. And we needed a convening architecture that could unite all nations and market actors behind a set of overarching global values, specifically so that those common values could prevent economic skirmishes from becoming catastrophic conflicts. That convening architecture is represented in the United Nations itself.

The United Nations was an irreplaceable driver of the rules-based order that manifested a new global financial architecture. One that spawned the greatest expansion of global wealth, innovation and political stability in human history. The world was called upon to define capitalism up. And it did. The UN was right at the center of it and we are still reaping the benefits to this day.

The second narrative is a bit more recent. And they revolve around the Millennium Development Goals, or the MDGs, which were launched in 2000.

The vision of the MDGs was to provide a development blueprint and agenda that would unite all of the nations of the world, and by extension other development and civil society actors. Many of you are probably aware of the signature achievement of the MDGs: that the global population living in extreme poverty would be reduced by more than half, and this was achieved well ahead of the MDGs deadline of 2015. But I would like to touch on several achievements that I believe were more impactful, if overlooked—all of them taking place in the world’s least developed countries.

One remarkable achievement was in the area of infant mortality. The infant mortality rate for the LDCs dropped significantly between 2000 and 2015, from roughly 85 per 1,000 births to 50 per 1,000 births. And the figure of 50 pales in comparison to the figure from 1990 of 107 per 1,000 in 1990.

Another achievement of the MDGs tied to the LDCs involved GDP per capita, which more than tripled during the period of the MDGs, from roughly USD 327 to USD 1,013.

Finally, there is access to the internet. In 2000, the ratio of people in the LDCs with access to the internet was practically 0 per 100. Let me repeat, the ratio was practically 0 per 100 people. By 2015, that figure became 21 per 100 people, which in raw numbers does not sound like much but in actuality represents a rise of over 2,000%. And of course, any successes that we see today in terms of digital financial inclusion rests of the shoulders of these early gains.

Now, you could also say that all of these gains were the inevitable byproduct of globalization. But the fact is the MDGs put development on the map, forcing development to be a top priority within the global community, while uniting a wealth of stakeholders around a common agenda that would ultimately impact decision making among the critical actors of global civil society. The MDGs insured that globalization would not be an entirely development agnostic exercise. And the UN was at the center of it.

This leads to the third narrative I would like to share. This regards the future—the future of the UN’s role in defining capitalism up. And for the purposes of this narrative, I would like to focus on what my organization—the United Nations Capital Development Fund—is doing in its own right to Define Capitalism Up.

And I am happy to say that our vision for defining capitalism up is codified in our Strategic Framework, which we just submitted to our Executive Board at UNDP. In fact, I would be remiss if I did not point out that today represents my first public remarks since UNCDF submitted its four-year Strategic Framework to our Executive Board. So, today represents the first public forum where I am sharing the vision and mission of the organization under my leadership.

If you read our Strategic Framework, you will find the vision of the organization—“for the world’s least developed countries to be able to access and leverage the development impact of capital to enable sustainable and inclusive economic growth and achieve the Sustainable Development Goals.” Specifically I would focus on this clause—“leverage the development impact of capital”—that is the lynchpin of UNCDF’s capabilities to define capitalism up.

Now, I will share with you the concrete ways that UNCDF will leverage the development impact of capital so that we can define capitalism up.

First, we will promote digital economies that are truly inclusive. There has always been a tremendous amount of hope and a tremendous amount of consternation around digital and how it can be the bridge to finance for those who have been traditionally underserved or financially excluded. But one of the powerful lessons of digital is that there is nothing inherently inclusive about it. Digital can, indeed, be a force of financial inclusion. But it can, almost as easily, be a force of financial exclusion. Digital is neutral. How we harness its power will determine how inclusive a force it will be.

This is what guides our strategy of promoting inclusive digital economies, where financial inclusion is not the end itself, but the means to an end—an end where people and communities are empowered to use innovative digital services in their daily lives while also contributing to the achievement of the SDGs.

Our approach is not merely about ensuring that people have access to a digital wallet. But rather that they operate in an environment conducive to financial inclusion and financial health—which is why we focus on market development. Namely, through an approach to develop the ideal market ecosystem for inclusive digital economies, which touches on four areas: (a) policy changes; (b) modern digital infrastructure and open payments systems; (c) private sector innovation; and (d) development of skills for the digital era.

And it is this approach that will help UNCDF achieve the goal of supporting 25 countries on their path to inclusive digital transformation, directly reaching 14 million people, by the year 2025.

Second, we will become a partner with municipal and subnational governments to support local transformative finance. One of the most overlooked realities is that local governments are indispensable and irreplaceable agents of SDG achievement. The vast majority of service delivery, whether in developed or developing markets, are carried out by subnational governments. But despite this reality, the flows of public and private finance that ultimately reach the local level, including finance relating to confronting the impacts of climate change, remain remarkably scarce.

UNCDF will serve as a technical and financial partner for local and regional governments to support the development of strong local capital markets, local fixed-capital formation, and expanded local fiscal space. All the while, we will guide our local government clients through three reinforcing transitions—the Green Transition, the Urban Transition, and the Productive Transition.

By supporting local governments on a path towards local transformation, we will look to catalyze at least USD 1 billion through third-party investment for local infrastructure projects, while supporting fiscal decentralization and public finance management in at least 20 countries within the next four years.

Third, we will look to catalyze the flows of capital in favor of investments in last mile settings, primarily in the LDCs, which will support achievement of the SDGs—investments in projects that have the potential for both commercial return on investment and sustainable development dividends. At the center of this work is our efforts to provide strategic investments and facilitate creditworthiness for projects across the investment continuum—from early stage to more mature enterprises and projects. Through our programmatic work, our partnerships and our boots-on-the ground presence, we will source investment opportunities and we will provide pre and post-investment advisory support to improve bankability and business development.

In the specific area of capital deployment, we will use our own financing in the form of grants, concessional loans and guarantees to finance early stage projects. And for those projects and businesses in the development finance gap that I mentioned earlier, we will provide catalytic concessional loans and guarantees from our own balance sheet as growth capital and to help build an investment record—specifically in the interest of liberating promising firms out of this gap in order to better access larger capital providers.

And we will also provide financial advisory services that support project origination, structuring, due diligence and development of new innovative financial instruments, notably SDG-oriented ETFs, nature performance bonds and blended finance vehicles.

Finally, and just as importantly, there is our advocacy and thought leadership. At the same time that there is an SDG finance gap, and a development finance gap, there is a thought leadership gap. And it is a gap relating to precisely where I began my remarks. There is a need for solutions-based thought leadership. A thought leadership that serves both a practical and a rhetorical level.

On the practical level, UNCDF has been a leader in leveraging thought leadership in order to demonstrate the effectiveness of innovative finance solutions—from our work with the OECD on the importance of blended finance to mobilize private capital for development; to our partnership with the UN Development Programme on how to best work with Big Fintech to support sustainable development; to our collaboration with global investors around harnessing global capital markets to scale sustainable finance. In almost every conversation I have with stakeholders, I can detect a profound desire for solutions. UNCDF plans to be an important provider of the solutions that are needed and sought after—solutions that not only apply to the LDCs but to developing and developed markets as well.

We will also be an advocate for our leading clients and partners, the world’s LDCs, a term that does not capture their true value or potential in the slightest. These markets represent an enormous and untapped opportunity for inclusive growth and human development that can be harnessed with the right types of support.

With their young population of more than one billion people – representing some 14% of the world population - LDCs are frontier markets and the growth markets of the future, which are ripe for investment and expansion. Technology and digital solutions, local infrastructure development, a new generation of dynamic entrepreneurs, and increased focus on South-South trade, are additional triggers that can allow LDCs to leapfrog towards greater prosperity.

Ask yourself this question—if you were an investor and you wanted to invest in the Asian Tigers of tomorrow, where would you look? Chances are you would look to the markets we support. And more to the point, we will remind the world of an unassailable fact—that the LDCs, the frontier and growth markets of the future, also represent the very crucible of the success of the SDG agenda.

On the rhetorical level, we need to push our thought leadership to advance a powerful reminder—not just that capital must serve humanity, but that capital can serve humanity. The market failure tendencies of the existing global financial architecture should be not be used as a cudgel against capital or capitalism as a whole. Capital is neutral. It’s the global financial architecture—the institutions and the people that command this architecture—that will determine how capitalism is defined.

Will it be defined down, where finance flows to dirty energy, wealth consolidation and a lack of access to finance for the traditionally underserved, leading to a lost decade of development? Or will it be defined up, where finance flows to clean energy and supports climate change, inclusive economic growth and an expansion of opportunity and access to finance, and the successful achievement of the SDG agenda by the 2030 deadline?

With a global financial architecture approaching a quadrillion in total assets, nearly 5 trillion in private equity, and the greatest level of innovation the world has ever seen in practically every area of human life. Whether capitalism is defined down or up will be our choice to make. And only our choice.

This leads to my closing and my call to action. I started my remarks with a discussion around the topic of SPACs. I want to be absolutely clear. I am not anti-SPAC. Show me a SPAC, or an NFT, or crypto-currency, or a collateralized debt obligation or a credit default swap that can be used to support sustainable development, and I will be happy to deploy it. Innovative financial instruments, like digital and like capital itself, is neutral. They can be used to mobilize the robust levels of finance that we need to fill the SDG finance gap and accelerate SDG achievement—if we choose to use them that way.

And this leads to my call to action. We have often hear the call to the private sector to draw a line in the sand and become an active, intentional and robust agent for sustainable development. To finally and fully embrace the path of stakeholder capitalism. This of course remains the case.

But my call to action today is specifically directed at the stakeholders who do not comprise the private sector—governments at the local, regional and central level; non-governmental organizations; philanthropic organizations; international finance institutions; development finance institutions; and, yes; the United Nations.

If we are going to continue asking the private sector to increase its appetite for promising projects in often overlooked or riskier markets, then the actors outside of the private sector need to increase its appetite for embracing the risk and innovation that comes with embracing innovative financial solutions. Even if we do not have the agility of the private sector, we can still possess the openness to new instruments, new capabilities, and an even greater willingness to play a significant role in acting as a de-risking partner for the private sector; whether through concessional finance, technical assistance or engagement with local and central governments.

Because the simple fact of the matter is the responsibility of delivering the right global financial architecture, and by extension to define capitalism up, relies on all of us. But if we deliver now and over the next decade, we would witness a global financial architecture that can do more than support sustainable development. It would support—in precisely the way the development economist Amartya Sen meant it when he wrote his seminal work Democracy as Freedom—freedom and agency itself.

This is the promise I can make to all of you as Executive Secretary. All of us at UNCDF are well aware that innovating, achieving results at scale and mobilizing resources to achieve sustainable development requires strong partnerships with a range of actors at global, regional and country levels. For those individuals, companies and institutions looking to explore every possible pathway to make capital work for humanity, and not the other way around, I promise that UNCDF will be your partner. We will take it upon ourselves to be as innovative, risk-taking and complementary as needed and as possible.

Let me close by invoking someone I have always admired personally; Sadhguru. He often discusses the idea that to understand the immensity of being human is to realize that to simply be human is to be super in and of itself. As remarkably humbling as the problems of the world can be, let us remember that there are plenty of examples of our human capacity to solve them in super fashion, when we make the decision to do so. Let us animate ourselves in this spirit as we move ahead with the hard and important work ahead of us.

Thank you.