(Yicai) Oct. 31 -- China should create a market-oriented stimulus mechanism and attract more private capital to enter the sustainable development area to give full play to green finance's role in driving sustainable urban development, experts said at a theme forum of World Cities Day held in Shanghai yesterday.

Building a market-oriented stimulus mechanism means building an investment and financing stimulus mechanism based on environmental, social, and governance assessment to unify the financial performance of green investment and business values, according to Ma Wenjie, head of Shanghai University of Finance and Economics' Shanghai Institute of International Finance Center. Big efforts should also be made to develop a carbon market and carbon finance system, Ma added.

China still faces challenges, such as unpolished information disclosure mechanisms and target assets appraisal systems for investors. In this regard, Ma suggested that China refers to some good overseas examples, such as Europe's regulation of greenwashing, to build an assessment system that has both international and domestic characteristics.

Moreover, China should refine its emission trading system and explore the possibility of building a carbon inclusion system, said Liu Jie, general manager at the Shanghai Environment and Energy Exchange.

Carbon inclusion means recording the behaviors of companies and the public cutting carbon emissions, and quantifying the value with disposal channels. There is still ample room for China to optimize carbon inclusion, including enriching carbon inclusion stimulus means, enhancing efforts to spread the idea of carbon inclusion, and increasing the economic benefits companies receive for participating in carbon inclusion, Liu noted.

Green investment and financing has become a key engine of China's economic growth, Zhang Xingrong, dean at the Yangtze Delta Financial Research Institute of Bank of China's Shanghai branch, said at the forum. As of June 30, the country's outstanding green loans exceeded CNY27 trillion (USD3.69 trillion), up over 38 percent from a year earlier, Zhang noted.

Editors: Dou Shicong, Futura Costaglione