There have been numerous calls to reform global financial networks.
Global financial networks are “deeply” implicated in the production and financing of climate heating, biodiversity loss, and poverty [1]. Debt is a critical part – money that could be used for mitigation and adaption is being diverted into interest and repayments [2]. And global shocks like COVID and the Ukraine War are delaying progress on a clean transition.
Voices for reform contend that we are now in polycrisis – interconnected crises of debt, climate, ecology, and inequality – and that globally integrated, stronger responses to these crises are desperately needed.
Are these calls new? And what changes can we see in reality?
Reform is an Endless Conversation
Calls to reform global financial networks are old.
After the “Asian financial crisis” of 1997, G7 Finance Ministers called for strengthening the resilience of the international financial architecture. Proposed reforms to the International Monetary Fund (IMF) were set out in 2010 – essentially, for developing countries to get a much greater say in how the IMF operates and greater flexibility for IMF in how it lends money [3]. By 2015, the Addis Ababa Action Agenda urged “earliest ratification” and implementation of those reforms [4].
Speed onto 2023, civil society organizations were still saying that “the current architecture is not fit for purpose… doesn’t respond to issues with the speed and skill required…digital tax – we don’t even have physical systems to tax those systems… (what does) reform look like without including care (work)? And (can we continue) to use GDP when it does not count these forms of work?” [5]
By late 2024, the idea that private finance could genuinely support climate response and achievement of Sustainable Development Goals was called a “fantasy” by a Chief Economist at World Bank [6]. Regardless, the Fourth International Conference on Financing for Development in 2025 explicitly promoted private finance and an “enabling” environment for business. The European Union’s Global Gateway strategy, for instance, encouraged use of donor aid to leverage private finance to undertake infrastructure projects supporting European geopolitical priorities [7].
Calls for reform are an endless conversation so have these voices been heard?
Change? Yes but No
Yes, there have been changes.
For instance [8], discussions under the so-called 2022 Bridgetown Initiative have increased country ability to pay their debts in the short term through a Resilience and Sustainability Trust at the IMF and Special Drawing Rights (IMF and G20). An international Loss & Damage Fund was launched at COP28. Multilateral Development Banks have increased support for climate-for-debt swaps. Official lenders such as World Bank are including natural disaster clauses across a range of new and existing loan agreements [8].
In private finance, there has been rapid acceleration of Climate Related Financial Disclosures for public listed companies. Officially mandated disclosures, as well as investor demands, are driving the explosion of ESG data creation, collation, and analytics. These are mostly risk focused – focusing on risk of nature’s impact on the portfolio and largely ignoring the portfolio’s impact on nature.
Ethical finance is “here to stay…(because) it is affecting corporate behaviour in a beneficial way, and it is encouraging a greener economy (and)…encouraging more concern over how the lives of people are affected by corporate behaviour” [9]. Investing for human dignity and ecological sustainability is changing Modern Portfolio Theory (MPT), but MPT is strongly embedded in human behaviour and by extension, machine thinking, so will persist.
No, some things have not changed.
Unheard in these discussions is explicit acknowledgement of the horrifying ecological cost of digital connectivity that powers global finance. There are some life cycle assessments of ecological damage caused by digital based on energy consumption but much more is needed. For instance, what is the ecological cost of ESG data gathering and reporting (footprint) compared to the social and ecological benefits claimed for ESG (handprint)?
The emergence of artificial intelligence is causing a boom in carbon emissions (for example at Microsoft); Big Tech are seeking planning permission to build private nuclear power-plants to fuel their unending slurp for energy; mining for rare earth minerals essential for digitization is now diving into the sea floor. Plastic devices to connect humans to digital networks are oil-industry dependent and generating massive levels of bulk waste [10]. At the same time, it’s clear that digital is implicated in generating and perpetuating social inequalities and no platform can guarantee data security.
Digitalization is a material-intensive process – without these materials there cannot be digitalization [10]. With increasing digitization of day-to-day life, monetization and pursuit of volume, the mindset of linear consumption of more stuff is perpetuated.
Despite this, we constantly hear the greenwashed claim from UN organizations, Big Tech companies, academic researchers, as well as international donors and philanthropists that digital will accelerate a ‘green transition’.
Option B: A Health-Centric Economy
Are these responses ‘enough’?
Clearly not. They are rather like bandaging the bleeding leg of patient on a trolley in the corridor of an overloaded hospital, while ignoring the fact that she is having a heart attack. How could we respond?
One alternative is a Well Being Economy.
The purpose of a Well Being economy [11] is exclusively to deliver human and ecological wellbeing.
Governments would measure the growth of human well-being and ecological health. An example is Bhutan’s Gross National Happiness Index. Bhutan has used this index since the 1970s to intentionally prioritize overall well-being and happiness over solely monetary goals. It has shaped Bhutan’s development policy ever since.
Economic activity would change from chain to donut thinking, circular by default.
Wealth wouldn’t be generated and then distributed rather pre-distributed – through policies to directly address inequality (e.g., creating and raising minimum wage or living wage rates).
Prevention would be prioritized – identifying the upstream or root causes and tackling those first not last.
And includes a greater push for people power – who gets a say when budgets are designed, economic strategies are written, and policies decided?
Transformational change such as a Wellbeing Economy is a democratic innovation. The democratic paradigm aims to transform power relations by means of socially-just, people-centered innovation. Rather than accepting existing power relations as given, a Wellbeing Economy turns its attention onto the system generating injustices and overtly seeks to change these.
The politics of actually transforming to a Wellbeing Economy though, aren’t raised. In all innovations there are winners and losers. For example, what would happen to human and ecological health if all health budgets focused solely on prevention activities like ending the high use of cancer producing pesticides in food production? What would happen to individual, public and corporate medical revenues if significantly less patients were presenting for prescriptions, tests, and surgical procedures? Potential losers with significant investments in the status quo can reject and actively prevent change.
But many ideas and policies of a Wellbeing Economy are being pursued in Europe and tested in other places. New Zealand, for instance, has already experimented with a Wellbeing Budget between 2019 and 2024.
The Wellbeing Economy, and options like it, appear to offer the reformers what they really want – an integrated and strong global response to interconnected crises.
And so…
When thinking of global finance as networks it becomes clearer that no single stakeholder has total control. IMF or World Bank, for instance, do not control all development finance flows nor any one investment firm all private finance flow. All stakeholders have influence that is limited. Within their limited ability to influence, then, some stakeholders have made changes. Whether these are ‘reforms’ may ultimately be in the eyes of the beholder since the word reform implies a positive change.
But transformative change is yet to be truly implemented.
References
[1] Newell P (2024) Towards A More Transformative Approach To Climate Finance University of Sussex https://hdl.handle.net/10779/uos.26180326.v1
[2] Hurley et al (2024) Breaking the Cycle of Debt in Small Island Developing States London: ODI
[3] IMF (2010) 2010 Year of IMF Reform https://www.imf.org/en/Blogs/Articles/2010/12/28/2010-the-year-of-imf-reform
[4] Fernandes C (2024) Lost Call for the International Financial Architecture Reform https://www.brettonwoodsproject.org/2024/10/the-lost-call-for-international-financial-architecture-reform-in-the-g20/
[5] Civil Society Forum (2023) African Perspectives on the Reforms of the International Financial Architecture https://www.brettonwoodsproject.org/2023/10/african-perspectives-on-the-reforms-of-the-international-financial-architecture/
[6] Gill I (2024) For Developing Economies, The Finance Landscape Has Become A Wasteland https://blogs.worldbank.org/en/voices/for-developing-economies-the-finance-landscape-has-become-a-wasteland
[7] Romero M (2025) Time to Push Back Against the Private Finance Bandwagon https://www.eurodad.org/time_to_push_back_against_the_private_finance_bandwagon_why_the_roles_of_public_and_private_finance_need_to_be_rebalanced_in_sevilla
[8] Saldhana J (2025) Ffd4: A Beacon Of Hope For International Financial Architecture Reform In 2025 https://www.eurodad.org/ffd4_a_beacon_of_hope_for_international_financial_architecture_reform_in_2025
[9] Battistella P (2022) ESG Here to Stay as the New Investment Theory https://www.fow.com/insights/3698393-esg-here-to-stay-as-the-new-investment-theory-domini
[10] UNCTAD (2024) Digitalization Trends and the Material Footprint https://unctad.org/system/files/official-document/der2024_ch02_en.pdf
[11] Edinburgh Futures Institute (2023) Why A Compassionate Economy Is A Wellbeing Economy And A Why A Wellbeing Economy Is A Compassionate One https://efi.ed.ac.uk/why-a-compassionate-economy-is-a-wellbeing-economy-and-a-why-a-wellbeing-economy-is-a-compassionate-one/