Financial Capital plays an important role sustainable development, enabling natural and social capitals to be owned and traded. But unlike the other types of capital, it has no real value itself but is representative of natural, human, social or manufactured capital; e.g. shares, bonds or banknotes. Although it has no real value it has a disproportionate significance in how a corporation’s performance is measured and plays a material role in driving the behavior of business leaders.
The sustainability crisis facing the world is because the human population is consuming the planets stocks of natural and social (including human) capital faster than it is being produced if indeed it can be. Unless these capitals are effectively managed the rate current rate of consumption will result in depletion and possible extinction of vital life sustaining resource stocks in the long term.
The WBCSD’s work in the Natural and Social Capital needs to be complemented by a work program in Financial Capital which focuses on educating the managers of financial capital on the sustainability issues implicit in their decisions and to change the “rules of the game” by bringing natural and social capital into balance with financial capital allocations.