Feb 5, 2020, 11:06 AM ETInvestor Day, Fireside Chat

Sustainability - Goldman Sachs 2020 Investor Day

Goldman Sachs announced a $750 billion commitment over the next decade to advance sustainable economic growth, covering financing, investing, and advising activities.
The initiative is anchored on two primary pillars: climate transition and inclusive growth, described by leadership as "ambitious" yet "realistic" based on secular economic trends.
This effort is positioned not as a separate fund or label, but as a core business strategy grounded in long-term research on future market dynamics.
The firm previously deployed $2.5 billion across its philanthropic footprint over the last decade, setting a baseline for the upcoming expansion.

Sustainable finance is mobilized across all divisions, including investment banking (green bonds, SDG-linked bonds), global markets (trading clean energy instruments), and asset management.
Specific transactional examples include:
- Enel raising capital via SDG-linked bonds tied to clean energy targets.
- Ecuador issuing its first-ever social sovereign bond to fund affordable housing for 24,000 families.
- Goldman Sachs helping clients like Verizon, Pepsi, and Apple tap the green bond market.
The "One Goldman Sachs" approach is applied to Ultra-High-Net-Worth clients, allowing them to access direct private impact investments managed by the firm's investment teams.
Sustainability is described as relevant to "anyone with a pulse," driven by client needs to align balance sheet capital with diversity goals, push renewables in supply chains, and navigate new ESG regulations.

The Urban Investment Group (UIG) targets underserved communities (e.g., South Bronx, West Baltimore, South LA) with a dual mandate to generate financial returns and create social value.
UIG strategy is "place-based," arguing that geography is a primary divider of economic opportunity, noting life expectancy gaps of up to 20 years between high- and low-income neighborhoods in the U.S.
Investment scale for UIG has grown from $10–$20 million annually 20 years ago to over $1.2 billion in the last year, utilizing a mix of Goldman Sachs capital and client capital.
In Newark, New Jersey, the firm has invested nearly $1 billion using a comprehensive strategy including:
- Financing new multi-family housing and K-12 schools.
- Repurposing underutilized manufacturing buildings (e.g., housing the world's largest aeroponic farm).
- Executing $100 million in energy efficiency retrofits for public housing, creating sustainable assets for 6,000 families.
Success in distressed communities relies on a "ground game" involving deep local coalitions, including public-private partnerships with mayors, economic development authorities, and local community leaders.

The Goldman Sachs Foundation expanded the "10,000 Women" program to 50,000 women globally (targeting 100,000), adding a gender finance facility that has deployed $1.45 billion in partnership with the IFC and World Bank.
The "10,000 Small Businesses" program has served 9,100 owners in the U.S. and 1,700 in the UK, with graduates collectively generating over $12 billion in revenue and employing 175,000 people.
Philanthropic capital is deployed with "typical Goldman Sachs rigor" to bridge gaps between education and capital access, specifically targeting disadvantaged communities.

Goldman Sachs has been carbon neutral since 2015 and is the first U.S. company to join three Climate Group initiatives (EV, renewable power, clean energy).
Every business unit of the firm financed, invested in, or owned over one gigawatt of clean energy in the previous year.
Leadership acknowledged the 1MDB scandal but emphasized an intensified, ongoing focus on risk management and compliance as central to the firm's operations.
The firm is the first U.S. bank to report sustainability data using SASB (Sustainability Accounting Standards Board) standards to standardize corporate disclosure.

Corporate leaders face increasing pressure from employees, supply chains, and investors to demonstrate meaningful purpose and ESG alignment.
Leadership anticipates a secular shift where private capital becomes essential to solving socioeconomic inequality and climate change, as public sector funding alone is deemed insufficient.
A key operational priority is resolving data fragmentation in ESG; the firm aims to transition the market toward "better data on fewer things that matter more" to reduce noise for asset owners and managers.
The firm views the current moment as an "inflection point" for sustainable finance, requiring leadership to address muddled regulatory landscapes and data transparency issues.