Capital with Conscience #2: Matthew Reddy, Global Environment Facility (GEF)

Capital with Conscience is a series that aims to provide in-depth conversations with leaders at the forefront of sustainable finance. Through these discussions, we explore the evolving landscape of impact investing, climate finance, and the policies shaping the transition to a low-carbon economy.

From all the way in Washington, D.C., we spoke with Matthew Reddy, Senior Private Sector Specialist at the Global Environment Facility (GEF), about the evolving role of businesses in sustainability, the intersection of climate finance and corporate strategy, and the challenges of ensuring meaningful private sector engagement in environmental markets.

GEF is a multilateral organization that provides funding to address global environmental challenges. Working across biodiversity, climate change, land degradation, chemicals, and international waters, GEF plays a critical role in financing sustainable development projects worldwide. It collaborates with governments, civil society, and the private sector to catalyze environmental action and strengthen resilience against climate risks.

From the Sydney Green Games to Global Sustainability Leadership

Brendan: Can you share more about your journey in the climate space and how you ended up where you are today?

Matthew: My career in sustainability and the environment started about 25 years ago. I had just returned from Japan, where I had been working and studying, and I began working in media—radio, television, and a bit of print. Around the year 2000, I had the opportunity to work with a Japanese company at the Sydney Green Games, which showcased groundbreaking sustainability efforts at the time.

I was amazed by the technologies on display—waste-wise event management, even a hydrogen fuel cell car, which was revolutionary 25 years ago. The entire event was offset, albeit through a rudimentary approach, but it sparked my interest in environmental sustainability.

At that time, sustainability wasn’t widely embraced by the business community. The dominant concept was corporate social responsibility (CSR), and climate finance was virtually non-existent. I joined Landcare, Australia’s largest environmental organisation, which uniquely brings together government, private sector, farmers, and conservationists. That experience propelled me into working with businesses—oil and gas, fast-moving consumer goods, and technology—on environmental initiatives.

As emissions trading schemes began emerging globally, I helped develop business models that financed ecosystem restoration through compliance markets, starting with the NSW Greenhouse Gas Abatement Scheme in 2004. From there, my work expanded into climate finance and environmental markets, eventually taking me to Switzerland with the World Business Council for Sustainable Development and now to Washington, D.C., with the GEF. Throughout my career, my focus has remained on forging partnerships between businesses, NGOs, and governments to drive sustainability outcomes.

The Evolving Role of Business in Sustainability

Brendan: Given your experience, how have you seen private sector engagement in sustainability evolve over time?

Matthew: In the early days, sustainability was often housed within health, safety, and environment (HSE) departments in industrial companies. It was primarily about risk mitigation and legal compliance, rather than a strategic business imperative. Sustainability reports back then often just stated, “We comply with all environmental laws,” which, frankly, is like saying you follow traffic laws—it’s the bare minimum.

Over time, several forces drove a shift:

• Investor demand for transparency—understanding physical and reputational risks in their portfolios.

• The rise of clean technology—creating new, profitable business opportunities.

• Government regulation—which played a key role in shaping industry behaviour.

  
  

Today, many companies integrate sustainability into their core business strategy. Some industries, like energy, chemicals, and manufacturing, have undergone major shifts—moving from fossil fuels to renewables or adopting circular economy principles. In Singapore, you can see this transformation in the work of Temasek and sovereign wealth funds, which are investing heavily in green technologies.

Businesses are no longer outsourcing sustainability to external consultants. Instead, Chief Sustainability Officers (CSOs) are joining executive leadership teams, and sustainability is becoming a lens through which companies view their entire operations. The private sector has become a driving force behind the sustainability agenda, often ahead of government regulations.

Brendan: While we’re seeing more corporate engagement in climate action, biodiversity and ecosystem restoration remain harder to fund. What are some of the key challenges you face in convincing private sector partners to invest in these areas?

Matthew: That’s a great point. One of the biggest hurdles is that businesses need a clear, quantifiable business case for investing in biodiversity. Unlike carbon markets, where the return on investment is more straightforward through emissions reductions and offset sales, biodiversity benefits are often less tangible and harder to monetise.

Another issue is that many corporations make strong commitments to sustainability, but the implementation and action plans don’t always keep pace. Companies announce bold environmental goals, but translating those into actual investments requires policy certainty, risk-sharing mechanisms, and clear pathways to profitability.

The Political Landscape and Its Impact on Sustainability

Brendan: With shifting political priorities—especially in the U.S.—how has private sector engagement been affected?

Matthew: Politics will always fluctuate, but the constant in all of this is business. Governments may pull back from climate commitments, but companies recognise that sustainability is key to long-term profitability. Even as some initiatives, like the Net Zero Banking Alliance, have faced challenges, we’ve seen record business participation in global climate events. At COP16 in Cali, Colombia, there was more private sector engagement than in all previous biodiversity conferences combined. The UN’s recent land and water management discussions in Saudi Arabia also saw unprecedented corporate interest.

Yes, we’ve seen political shifts but in reality, the private sector remains steadfast. Many global businesses are deeply embedded in sustainability strategies that transcend government cycles. What really matters is business leadership and investor engagement, which continue to drive change despite short-term political shifts.

The Role of Local Communities in Climate Finance

Brendan: We’ve talked a lot about the private sector and governments, but one thing we have yet to cover is the role of local communities. At the start of our conversation, we discussed how climate finance should flow to those who need it most. How do we ensure that local communities play a bigger part in determining how climate finance flows? How do we incentivize them to protect biodiversity-rich regions when financial support often doesn’t reach them directly? And from your experience at GEF, are there any good case studies that showcase how this can work effectively?

Matthew: Many local communities and Indigenous peoples are the true stewards of land and water. They are actively managing natural resources on a daily basis, yet they are often left out of climate finance discussions. If we genuinely want transformation, we need to ensure that climate finance reaches these communities directly and is structured in a way that supports their leadership in conservation efforts.

We often talk about climate finance, but for these communities, it’s not just about emissions reductions—it’s about livelihood finance, resilience finance, and production finance. Climate finance needs to align with their economic and social needs. A smallholder farmer, for example, isn’t thinking in terms of “carbon finance”—they are thinking about how to feed their family, sustain their land, and secure stable income.

A great example is in Northern Australia, where Indigenous communities have long practiced controlled burning to prevent catastrophic wildfires. Their approach reduces emissions, and this activity is now formally recognised within Australia’s carbon markets. Companies can purchase carbon credits from these communities, ensuring that they are compensated for their traditional land management practices. We’re now working to replicate this model in Southern Africa, where similar traditional fire management approaches can be integrated into climate finance mechanisms.

In the agriculture and forestry sectors, commodity certification programs—such as the Better Cotton Initiative, Sustainable Rice Platform, and the Roundtable on Sustainable Palm Oil (RSPO)—have successfully channeled climate finance into local communities. These programs set sustainability standards, provide smallholder farmers with better market access, and incentivise sustainable land management practices.

However, we need to move beyond isolated projects. The focus should be on integrated, long-term financing structures that support local communities not just for one season, but for generations. This is where public-private partnerships, blended finance models, and policy coherence are essential. Governments need to harmonise their policies to ensure that businesses and investors have a clear framework for supporting sustainable, community-driven projects.

We also need stronger safeguards to ensure that climate finance doesn’t just flow to large corporate-led projects but genuinely benefits local communities. This means designing participatory governance structures, ensuring transparent benefit-sharing agreements, and leveraging technological innovations like digital finance platforms to get funds directly into the hands of community leaders.

Ultimately, the shift we need to see is one where local communities aren’t just beneficiaries of climate finance, but active decision-makers in how it’s deployed. The more we integrate their perspectives, the more effective and equitable our sustainability solutions will be.

A Wish for 2025

Brendan: If you had one wish for 2025—either for climate finance in general or your work with GEF—what would it be?

Matthew: I’d like to see more focus on non-financial collaboration under Article 6.8 of the Paris Agreement. There’s a lot of excitement around market-based mechanisms like carbon trading, but long-term sustainability depends on partnerships, knowledge-sharing, and structural reforms. Businesses, governments, and communities need to work together beyond financial transactions to achieve real impact.