The Role of Finance in Solving Global Issues and in the Transition to a New Civilisation

Finance is one of the fundamental tools that has underpinned and shaped global civilisation, alongside agriculture and writing systems. During the past 5,000years finance has adapted and innovated to scale civilisation by funding industrial development, technological advancement and human progress generally. Given this traditional role, finance should play an essential role in supporting the solutions to the world's major challenges, including income inequality, climate change, mass migration, unsustainable resource consumption, among others. In the industrial era, finance was banker to industry, government and the military, among others, in its conquests. By the last quarter of the 21st Century, finance had become 'Big Finance' and was a major power bloc in its own right. Today, ever more sophisticated forms of finance have been highly innovative at financing itself, without directly touching an endeavour to invest in, and so streams of finance find themselves divorced from the world's challenges, rather than solving them, leading to a rise in calls for the need to reform and reinvent many of its tools and institutions. In the absence of reform from within, revolution from without has often addressed imbalances in other spheres of life and has carried with it substantial risks and costs. Looking ahead, as the world enters the information age, the internet is transforming finance into something digital, global, distributed, and disintermediated and this promises to transform it into something radically different than it is today. Current financial institutions have a choice of either being at the forefront of this transformation, launching their own reforms and revolution, to be relevant to the challenges and opportunities of the mainstream, or risking being swept away. This paper is intended to provide a high-level conceptual overview of the history, challenges and questions facing finance as the world transitions to the next world order.