Transformation Capital: The Challenge of Designing and Testing a New Investment Logic for the Sustainable Development Goals

The most tangible and pressing problems of the 21^st century are complex systemic issues. Addressing them requires deep structural changes within the socio-technical systems that constitute modern civilization. As financial capital is an important lever of change in such systems, the way in which we deploy capital affects our ability to accomplish the UN’s Sustainable Development Goals. The problem is that today’s capital markets operate under a set of axioms, paradigms, and structures that make them ill-suited to fuel systemic transformations. There is thus a need for an investment logic that deploys capital with a different intent and mindset and with different methodologies, structures, capabilities, and decision-making frameworks. Residing at the intersection of systems thinking and financepractice, Transformation Capital is such a logic. This article introduces Transformation Capital and discusses how it can be tested through real-world prototyping.