Challenges and Solutions of AB-SFC Methodology for ESG Sustainable Social Security Systems

The construction of an efficient financial-investment model for social security system is of paramount importance for ensuring the well-being and social stability of the population. In this regard, the AB-SFC modeling method presents promising opportunities for analyzing and assessing the dynamics of social security systems. This research investigates the possibilities of utilizing the AB-SFC modeling method to develop an efficient financial-investment model for addressing poverty and income inequality in social security provision. By employing the AB-SFC approach, which combines agent-based modeling (ABM) with stock-flow-consistent (SFC) modeling, this study aims to enhance the accuracy and realism of financial simulations in social security systems. Through an analysis of poverty and income inequality within the population, this research examines how the AB-SFC modeling method can contribute to understanding and mitigating these socioeconomic challenges. This study investigates the capabilities of the AB-SFC modeling method in capturing the key features of social security, including contributions, benefits, investments, and demographic factors, while accounting for the dynamic interactions among households, government entities, and financial institutions. This study provides valuable insights into the strengths and limitations of AB-SFC modeling and offers recommendations for policymakers to design effective strategies for reducing poverty and income inequality within the context of social security. The findings highlight the value of the AB-SFC modeling method in constructing an efficient financial-investment model for social security and provide insights into its potential applications in enhancing the ESG sustainability and effectiveness of social security systems.