Financing sustainable city goals in Sweden: preliminary findings

The document reports that while Swedish cities are actively pursuing climate neutrality and social sustainability, there is a lack of national coordination, leading to varied levels of ambition and format in sustainability plans. External financing is not considered a bottleneck for achieving these goals due to low interest rates and the ability to borrow for capital expenditure. Green bonds have been issued primarily for non-financial reasons, such as marketing or avoiding political criticism, rather than financial necessity. Conversely, there is low interest in social bonds and social impact bonds, which are perceived as too small-scale, complex, or difficult to measure. The brief also notes a 'silo effect' where sustainability projects are disconnected from finance departments, and highlights that political changes can lead to the abolition of sustainability goals.

• Swedish municipalities and regions lack national coordination or recommended frameworks for sustainability, resulting in a wide range of ambition; some use visions while others employ integrated programmes with targets for 2030 and 2050.
• External financing is not a primary obstacle to meeting Agenda 2030 goals because municipalities can borrow for capital expenditure at low interest rates.
• The issuance of green bonds by Swedish cities is driven largely by non-financial motives, including marketing opportunities and the desire to protect health budgets from being used for green investments.
• There is minimal interest in social bonds due to difficulties in measuring the impact of social assets and the fact that social activities often require operational expenditure (OPEX), which cannot be funded through debt.
• Social impact bonds (SIBs) are viewed as an unattractive financing option because they are considered too complicated and the funding levels are too small to be viable.
• A 'silo effect' exists in some municipalities where the teams implementing sustainability technologies or projects have little to no contact with the finance departments that could fund them.
• Sustainability goals in municipalities are vulnerable to political shifts; in one instance, a change in administration led to the abolition of 20 sustainability-related goals.

APA

Sjöström, E., Waltré, N., Nilsson, A., Carrion, A. R., Eriksson, A., Agerström, M., & Vanhuyse, F. (2020). Financing sustainable city goals in Sweden: preliminary findings. Stockholm Environment Institute. https://www.sei.org/wp-content/uploads/2020/03/discussion-brief-oct-2020-financing-sustainable-city-goals-in-sweden.pdf

Chicago

Sjöström, Emma, Nina Waltré, Astrid Nilsson, Alicia Requena Carrion, Aina Eriksson, Magnus Agerström, and Fedra Vanhuyse. Financing sustainable city goals in Sweden: preliminary findings. Stockholm Environment Institute, 2020. https://www.sei.org/wp-content/uploads/2020/03/discussion-brief-oct-2020-financing-sustainable-city-goals-in-sweden.pdf.

Wikipedia

{{cite report |last1=Sjöström |first1=Emma |last2=Waltré |first2=Nina |last3=Nilsson |first3=Astrid |last4=Carrion |first4=Alicia Requena |last5=Eriksson |first5=Aina |last6=Agerström |first6=Magnus |last7=Vanhuyse |first7=Fedra |title=Financing sustainable city goals in Sweden: preliminary findings |publisher=Stockholm Environment Institute |date=October 2020 |url=https://www.sei.org/wp-content/uploads/2020/03/discussion-brief-oct-2020-financing-sustainable-city-goals-in-sweden.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{sjstrm2020financing, author = {Sjöström, Emma and Waltré, Nina and Nilsson, Astrid and Carrion, Alicia Requena and Eriksson, Aina and Agerström, Magnus and Vanhuyse, Fedra}, title = {{Financing sustainable city goals in Sweden: preliminary findings}}, institution = {Stockholm Environment Institute}, year = {2020}, month = oct, url = {https://www.sei.org/wp-content/uploads/2020/03/discussion-brief-oct-2020-financing-sustainable-city-goals-in-sweden.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }