From "Financial Instruments" to "Social Relationships": Prof. David A. Palmer Explores Social Resilience and a Just Transition at the CASI Sustainability Forum
On 11 September 2026, the CASI Sustainability Forum was held at The University of Hong Kong under the theme "Shaping Inclusive Transitions in Asia: Enhancing SMEs' Resilience and Adaptation to Climate Change." Professor David A. Palmer, Professor in the Department of Sociology, Faculty of Social Sciences, and Director of the Global Society and Sustainability Lab at The University of Hong Kong, was invited to deliver a special address entitled "SMEs and Social Resilience: Towards a Just Transition."
9/21/20264 min read
On 11 September 2026, the CASI Sustainability Forum was held at The University of Hong Kong under the theme "Shaping Inclusive Transitions in Asia: Enhancing SMEs' Resilience and Adaptation to Climate Change." Co-organized by the Capacity-building Alliance of Sustainable Investment (CASI), the HKMA Infrastructure Financing Facilitation Office (IFFO), the United Nations Development Programme (UNDP), the Global Society and Sustainability Lab (GSSL) under the Faculty of Social Sciences, the University of Hong Kong, and the CFA Institute. The Forum was held during the third Hong Kong Green Week and brought together more than 370 participants online and on site from the policy, financial, business, academic and development sectors to explore how sustainable finance can support SMEs in addressing climate risks and advance inclusive transitions. Professor David A. Palmer, Professor in the Department of Sociology, Faculty of Social Sciences, and Director of the Global Society and Sustainability Lab at The University of Hong Kong, was invited to deliver a special address entitled "SMEs and Social Resilience: Towards a Just Transition."
From an anthropological perspective, Prof. Palmer noted that SMEs and local communities are not "blank spaces" waiting for financial instruments to enter. In many developing regions, financing arrangements, mutual-aid networks and systems of social trust have already been established through local institutions and relationships. When financial institutions interpret local economic activities solely through the institutional frameworks and indicators with which they are familiar, they may overlook these existing social systems and the roles they play.
Using pastoral communities in Mongolia as an example, Prof. Palmer explained that financial instruments are not neutral arrangements: once introduced into a particular social context, they can reshape patterns of cooperation, relationships of interest and community structures. Where loans are linked to livestock numbers, while cashmere markets reward quantity rather than quality, pastoralists may be encouraged to increase herd sizes, thereby intensifying pressure on grassland ecosystems. This does not mean that finance inevitably undermines social structures; rather, it illustrates how financial instruments can reorganise relationships and incentive mechanisms when they enter specific social environments.
Turning to the concept of "social resilience," Prof. Palmer emphasised that a community's capacity to cope with crises is often not captured by conventional financial indicators. Drawing again on the experience of Mongolian pastoralists during extreme winters, he highlighted how families rely on kinship networks, neighbourhood cooperation and resource sharing to distribute risks. Social resilience, in this sense, is grounded in networks of trust, responsibility and mutual support. If financial or assistance mechanisms overlook these existing networks, they may unintentionally weaken social support systems that are already functioning effectively.
Prof. Palmer also introduced Mongolia's emerging model of " green herder loan," which seeks to link credit conditions to factors such as herd reduction, product quality and the ecological condition of grasslands. By changing existing competitive incentives, such mechanisms can encourage pastoralists to move from competing for resources towards collectively maintaining shared pastureland, allowing financial instruments to reinforce rather than undermine local forms of cooperation.
Building on these observations, Prof. Palmer proposed that an important question in the design of sustainable financial instruments should be: what kinds of social institutions, relationship networks and mechanisms of cooperation already exist before finance enters a community, and how might a new financial instrument reshape them? He argued that understanding these social foundations should not be treated merely as an additional risk-management consideration, but as an integral part of financial product design and investment decision-making.
During the Forum, participants also discussed a range of issues related to inclusive transition finance and climate resilience. These included how innovative transition-finance instruments, blended finance and risk-sharing mechanisms can be scaled for SMEs; how to provide more accessible and inclusive financial services to SMEs undergoing low-carbon transitions while reducing transaction and verification costs, strengthening supply-chain cooperation, and using digital and AI-enabled tools to link financing with measurable progress; and how to close the gap between adaptation policies and investable projects through clearer demand signals, stronger project preparation and better data support. Participants further explored approaches to building economy-wide and city-level climate resilience, emphasising location-specific data, coordinated governance, insurance and catalytic capital, as well as the importance of assessing whether investment reaches vulnerable communities and contributes to reducing inequality.
In concluding his remarks, Prof. Palmer emphasised that "transition begins with people, and ultimately ends with people." For sustainable finance, the key question is therefore not only where capital is directed, but also how the flow of capital affects relationships among people, local mechanisms of cooperation, and communities' capacity to respond to future change.
Since its official launch at COP28 in December 2023, CASI has grown to more than 70 member institutions and has provided training to more than 10,000 people across over 100 countries. The CASI Sustainability Forum provided an important platform for dialogue and knowledge exchange on transition finance for SMEs, climate adaptation and resilience, contributing to broader discussions on advancing inclusive transitions across Asia.
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