Giving Compass' Take:

• Brookings highlights a new report that assesses the global financial system, emphasizing the need to create a systems change to address the most pressing challenges.

• How can nonprofits and international aid organizations play a role in this effort? Which collaborations would best address environmental sustainability, growing poverty and other problems?

• Here are five steps for contributing to complex systems change.

The report of the G-20 Eminent Persons Group (EPG) on Global Financial Governance, chaired by Singapore’s Deputy Prime Minister Tharman Shanmugaratnam, released this week at the Annual Meetings of the IMF and World Bank in Bali, offers consequential ideas for making the global financial system work for all. The report covers development finance as well as reforms for global financial resilience. This post summarizes the content of the development finance portion.

The EPG report makes three basic points on development finance:

  1. The world needs a better system to achieve development impact through promoting economic stability and sustainable growth, and it needs it now.
  2. This requires global development finance institutions to work together as a system, rather than as separate entities.
  3. A new governance structure should provide coherence across key institutions to ensure that the system works well across all its component parts.

Each of these points represents a fresh perspective on the global economy. Together, they could result in radical change.

Read the full article about systems thinking in global finance governance by Amar Bhattacharya and Homi Kharas at Brookings.