Sustainable finance for SDG 8: Driving decent work through human capital investment

Abstract

The global shift to sustainable development has improved the strategic importance of financial instruments in the achievement of the Sustainable Development Goal (SDG) 8 which promotes decent work and economic growth. Despite the positive environmental and financial impacts of sustainable finance and Environmental, Social and Governance (ESG) integration, their potential to foster workforce development is largely unrecognized. This conceptual paper provides a framework that shows how sustainable finance and corporate ESG initiatives support decent work and economic growth through strategic human capital investments. The framework is grounded in Human Capital Theory and suggests that these sustainability mechanisms accelerate the necessary workforce initiatives that include reskilling, upskilling and Technical and Vocational Education and Training (TVET) programs. Thus, such strategic investment improves employability, aggregate productivity and sustainable economic growth. In this paper, human capital development is proposed as the key mediating bridge between sustainability and macroeconomic outcomes. A unified theoretical framework is proposed to link finance, ESG practices and workforce development to operationalize and deliver the goals of SDG 8.