ESG Finance - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts (2024 - 2029)
The ESG Finance Market size is estimated at USD 7.02 trillion in 2024, and is expected to reach USD 11.33 trillion by 2029, growing at a CAGR of 10.04% during the forecast period (2024-2029).
Investment in sustainable firms is rising due to the increasing demand for financial professionals specializing in sustainable finance. Not only does sustainable finance reduce risk exposure and improve returns, but it also reduces costs and mitigates risk. However, market growth is limited by challenging diversification challenges and high operating expenses. Despite this, the market for sustainable finance has a lot of potential for profitability as industries become more conscious of the environment.
The ESG finance market is growing due to an increase in investment in sustainable businesses. Investors increasingly know the need to tackle environmental and social issues and are looking for sustainable investment opportunities.
The market is expected to grow as people become more aware and concerned about the environment and social problems, including climate change, depletion of resources, and social injustice. This increased awareness has led to an increase in the need for sustainable financial solutions as people, companies, and institutions want to make sure their investments are in line with their beliefs and help make the world a better place. Regulatory frameworks and government policies also play an important role in the market's growth.
Sustainable finance comes in many forms. Institutional investors and funds are now embracing a variety of ESG investing strategies. This shift has been driven by changes in demand across the financial system, driven by both a desire for better long-term financial value and a desire to align with values. For instance, one of the most notable developments in ESG finance in the current year is the phenomenal growth of green issuance, compared to significant declines in issuance in the United States and Asia.
ESG Finance Market Trends
Rising Investments in Green Bonds
Green bond transactions have gained the most market share in the sustainability finance market. There is a growing awareness and urgency around environmental issues, including climate change and sustainability. Investors and institutions are looking for investment opportunities that are in line with their environmental goals.
Green bonds provide issuers with a clear and straightforward route to raising capital for projects that have a positive impact on the environment. These projects are typically focused on renewable energy, improving energy efficiency, and clean transportation, among other projects for greenhouse gas (GHG) emissions reductions and support sustainable development. Third, investors are increasingly prioritizing sustainable investments. As a result, there is a surge in demand for green bonds, driving the market’s growth.
Green bond transactions have captured the largest share of the global sustainable finance market due to the increasing awareness of environmental issues among investors and the support of regulatory measures. As the demand for sustainable investments increases, green bonds will continue to play an important and effective role in funding socially responsible projects to combat environmental issues.
Europe is Dominating the ESG Finance Market
The European sustainable finance market accounts for a significant revenue share. The market will continue to grow in Europe due to strong government and regulatory support for sustainable initiatives, growing investor demand for responsible investment, and the region’s focus on environmental and climate objectives. For example, the European Union’s Sustainable Finance Action Plan seeks to redirect capital flows towards sustainable projects and bring financial markets in line with sustainability objectives. The EU’s Taxonomy Regulation also provides a standardized framework to classify sustainable economic activities, increasing transparency and credibility in Europe’s sustainable finance practices.
In addition, one of the reasons for Europe’s market dominance is the increasing adoption of sustainability fintech. Sustainable fintech platforms allow people and businesses to make ethical investment choices by incorporating ESG factors into financial products and services.
ESG Finance Industry Overview
The ESG Finance Market is moderately fragmented. The key players often merge, form strategic partnerships, and collaborate to increase their market share and expand their services. With a strong emphasis on sustainability and responsible investing, these companies aim to capture a large share of the market and become leaders in sustainable finance. As the need for sustainable finance increases, these companies will continue to dominate the market and play an important role in the future of global sustainable finance. Some of the leading players in global sustainable finance include BlackRock, Inc., State Street Corporation, Morgan Stanley, UBS, and JPMorgan Chase & Co.
Additional Benefits:
The market estimate (ME) sheet in Excel format
3 months of analyst support
Investment in sustainable firms is rising due to the increasing demand for financial professionals specializing in sustainable finance. Not only does sustainable finance reduce risk exposure and improve returns, but it also reduces costs and mitigates risk. However, market growth is limited by challenging diversification challenges and high operating expenses. Despite this, the market for sustainable finance has a lot of potential for profitability as industries become more conscious of the environment.
The ESG finance market is growing due to an increase in investment in sustainable businesses. Investors increasingly know the need to tackle environmental and social issues and are looking for sustainable investment opportunities.
The market is expected to grow as people become more aware and concerned about the environment and social problems, including climate change, depletion of resources, and social injustice. This increased awareness has led to an increase in the need for sustainable financial solutions as people, companies, and institutions want to make sure their investments are in line with their beliefs and help make the world a better place. Regulatory frameworks and government policies also play an important role in the market's growth.
Sustainable finance comes in many forms. Institutional investors and funds are now embracing a variety of ESG investing strategies. This shift has been driven by changes in demand across the financial system, driven by both a desire for better long-term financial value and a desire to align with values. For instance, one of the most notable developments in ESG finance in the current year is the phenomenal growth of green issuance, compared to significant declines in issuance in the United States and Asia.
ESG Finance Market Trends
Rising Investments in Green Bonds
Green bond transactions have gained the most market share in the sustainability finance market. There is a growing awareness and urgency around environmental issues, including climate change and sustainability. Investors and institutions are looking for investment opportunities that are in line with their environmental goals.
Green bonds provide issuers with a clear and straightforward route to raising capital for projects that have a positive impact on the environment. These projects are typically focused on renewable energy, improving energy efficiency, and clean transportation, among other projects for greenhouse gas (GHG) emissions reductions and support sustainable development. Third, investors are increasingly prioritizing sustainable investments. As a result, there is a surge in demand for green bonds, driving the market’s growth.
Green bond transactions have captured the largest share of the global sustainable finance market due to the increasing awareness of environmental issues among investors and the support of regulatory measures. As the demand for sustainable investments increases, green bonds will continue to play an important and effective role in funding socially responsible projects to combat environmental issues.
Europe is Dominating the ESG Finance Market
The European sustainable finance market accounts for a significant revenue share. The market will continue to grow in Europe due to strong government and regulatory support for sustainable initiatives, growing investor demand for responsible investment, and the region’s focus on environmental and climate objectives. For example, the European Union’s Sustainable Finance Action Plan seeks to redirect capital flows towards sustainable projects and bring financial markets in line with sustainability objectives. The EU’s Taxonomy Regulation also provides a standardized framework to classify sustainable economic activities, increasing transparency and credibility in Europe’s sustainable finance practices.
In addition, one of the reasons for Europe’s market dominance is the increasing adoption of sustainability fintech. Sustainable fintech platforms allow people and businesses to make ethical investment choices by incorporating ESG factors into financial products and services.
ESG Finance Industry Overview
The ESG Finance Market is moderately fragmented. The key players often merge, form strategic partnerships, and collaborate to increase their market share and expand their services. With a strong emphasis on sustainability and responsible investing, these companies aim to capture a large share of the market and become leaders in sustainable finance. As the need for sustainable finance increases, these companies will continue to dominate the market and play an important role in the future of global sustainable finance. Some of the leading players in global sustainable finance include BlackRock, Inc., State Street Corporation, Morgan Stanley, UBS, and JPMorgan Chase & Co.
Additional Benefits:
The market estimate (ME) sheet in Excel format
3 months of analyst support
1 INTRODUCTION
1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
2 RESEARCH METHODOLOGY
3 EXECUTIVE SUMMARY
4 MARKET DYNAMICS
4.1 Market Overview
4.2 Market Drivers
4.2.1 Rise in Investment in Businesses with Sustainable Practices is a Driving Force Behind the Growth of The Sustainable Finance Market
4.2.2 Increasing Government Initiative Towards Sustainability
4.3 Market Restraints
4.3.1 Lack of Agreement on ESG Data and The Availability of These Data Points.
4.3.2 Mobilization and Incentivisation of Private Companies, Especially Small to Medium Enterprises, to Share Their ESG Data.
4.4 Market Opportunities
4.4.1 Non-profit Organisations and Academic Institutions are Also Vital in Driving Awareness of Sustainable Finance.
4.4.2 The Promotion of Environmental and Social Consciousness and Consumerism Among People and Investors.
4.5 Value Chain / Supply Chain Analysis
4.6 Porters 5 Force Analysis
4.6.1 Threat of New Entrants
4.6.2 Bargaining Power of Buyers/Consumers
4.6.3 Bargaining Power of Suppliers
4.6.4 Threat of Substitute Products
4.6.5 Intensity of Competitive Rivalry
4.7 PESTLE Analysis
5 MARKET SEGMENTATION
5.1 By Investment Type
5.1.1 Equity, Fixed Income, Mixed Allocation
5.1.2 Fixed Income
5.1.3 Mixed Allocation
5.1.4 Other Investment Types
5.2 By Transaction Type
5.2.1 Green Bond
5.2.2 Social Bond
5.2.3 Mixed Sustainability Bond
5.2.4 ESG Integrated Investment Funds
5.2.5 Other Transaction Types
5.3 By Investor Type
5.3.1 Institutional Investors
5.3.2 Retail Investors
5.4 By Industry Vertical
5.4.1 Utilities
5.4.2 Transport & Logistics
5.4.3 Chemicals
5.4.4 Food and Beverage
5.4.5 Government
5.4.6 Other Industry Verticals
5.5 By Region
5.6 North America
5.6.1 United States
5.6.2 Canada
5.6.3 Mexico
5.6.4 Rest of North America
5.7 Europe
5.7.1 United Kingdom
5.7.2 Germany
5.7.3 France
5.7.4 Russia
5.7.5 Italy
5.7.6 Spain
5.7.7 Rest of Europe
5.8 Asia-Pacific
5.8.1 India
5.8.2 China
5.8.3 Japan
5.8.4 Australia
5.8.5 Rest of Asia-Pacific
5.9 South America
5.9.1 Brazil
5.9.2 Argentina
5.9.3 Rest of South America
5.10 Middle-East and Africa
5.10.1 United Arab Emirates
5.10.2 South Africa
5.10.3 Rest of Middle-East and Africa
6 COMPETITIVE LANDSCAPE
6.1 Vendor Market Share
6.2 Mergers & Acquisitions
6.3 Company Profiles
6.3.1 BlackRock, Inc.
6.3.2 State Street Corporation
6.3.3 Morgan Stanley
6.3.4 UBS
6.3.5 JPMorgan Chase & Co.
6.3.6 Franklin Templeton Investments
6.3.7 Amundi US
6.3.8 The Bank of New York Mellon Corporation
6.3.9 Deutsche Bank AG
6.3.10 Goldman Sachs*
7 MARKET OPPORTUNITIES AND FUTURE TRENDS
8 DISCLAIMER AND ABOUT US
1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
2 RESEARCH METHODOLOGY
3 EXECUTIVE SUMMARY
4 MARKET DYNAMICS
4.1 Market Overview
4.2 Market Drivers
4.2.1 Rise in Investment in Businesses with Sustainable Practices is a Driving Force Behind the Growth of The Sustainable Finance Market
4.2.2 Increasing Government Initiative Towards Sustainability
4.3 Market Restraints
4.3.1 Lack of Agreement on ESG Data and The Availability of These Data Points.
4.3.2 Mobilization and Incentivisation of Private Companies, Especially Small to Medium Enterprises, to Share Their ESG Data.
4.4 Market Opportunities
4.4.1 Non-profit Organisations and Academic Institutions are Also Vital in Driving Awareness of Sustainable Finance.
4.4.2 The Promotion of Environmental and Social Consciousness and Consumerism Among People and Investors.
4.5 Value Chain / Supply Chain Analysis
4.6 Porters 5 Force Analysis
4.6.1 Threat of New Entrants
4.6.2 Bargaining Power of Buyers/Consumers
4.6.3 Bargaining Power of Suppliers
4.6.4 Threat of Substitute Products
4.6.5 Intensity of Competitive Rivalry
4.7 PESTLE Analysis
5 MARKET SEGMENTATION
5.1 By Investment Type
5.1.1 Equity, Fixed Income, Mixed Allocation
5.1.2 Fixed Income
5.1.3 Mixed Allocation
5.1.4 Other Investment Types
5.2 By Transaction Type
5.2.1 Green Bond
5.2.2 Social Bond
5.2.3 Mixed Sustainability Bond
5.2.4 ESG Integrated Investment Funds
5.2.5 Other Transaction Types
5.3 By Investor Type
5.3.1 Institutional Investors
5.3.2 Retail Investors
5.4 By Industry Vertical
5.4.1 Utilities
5.4.2 Transport & Logistics
5.4.3 Chemicals
5.4.4 Food and Beverage
5.4.5 Government
5.4.6 Other Industry Verticals
5.5 By Region
5.6 North America
5.6.1 United States
5.6.2 Canada
5.6.3 Mexico
5.6.4 Rest of North America
5.7 Europe
5.7.1 United Kingdom
5.7.2 Germany
5.7.3 France
5.7.4 Russia
5.7.5 Italy
5.7.6 Spain
5.7.7 Rest of Europe
5.8 Asia-Pacific
5.8.1 India
5.8.2 China
5.8.3 Japan
5.8.4 Australia
5.8.5 Rest of Asia-Pacific
5.9 South America
5.9.1 Brazil
5.9.2 Argentina
5.9.3 Rest of South America
5.10 Middle-East and Africa
5.10.1 United Arab Emirates
5.10.2 South Africa
5.10.3 Rest of Middle-East and Africa
6 COMPETITIVE LANDSCAPE
6.1 Vendor Market Share
6.2 Mergers & Acquisitions
6.3 Company Profiles
6.3.1 BlackRock, Inc.
6.3.2 State Street Corporation
6.3.3 Morgan Stanley
6.3.4 UBS
6.3.5 JPMorgan Chase & Co.
6.3.6 Franklin Templeton Investments
6.3.7 Amundi US
6.3.8 The Bank of New York Mellon Corporation
6.3.9 Deutsche Bank AG
6.3.10 Goldman Sachs*
7 MARKET OPPORTUNITIES AND FUTURE TRENDS
8 DISCLAIMER AND ABOUT US
