The sustainable finance market has witnessed exponential growth, expanding from $5,487.20 billion in 2023 to $6,718.20 billion in 2024, achieving a CAGR of 22.4%. This surge is driven by increasing investor demand, the proliferation of corporate social responsibility initiatives, regulatory support, a growing focus on sustainable supply chains, and rising investments in renewable energy. The market is expected to reach $15,313.29 billion by 2028, with a CAGR of 22.9%. Future growth will be propelled by a heightened focus on reducing carbon footprints, increasing demand for sustainable investments, and greater access to green bonds, supported by advancements in AI and green technologies.
Major Driver In The Sustainable Finance Market
The sustainable finance market is poised for growth due to the rising emphasis on corporate social responsibility (CSR) initiatives. CSR represents businesses’ commitment to contributing positively to society and the environment, beyond mere profit maximization. This trend is motivated by ethical considerations, enhanced brand image, and evolving consumer expectations. For instance, Takeda Pharmaceutical Company Limited's $19.5 million commitment to CSR in 2022, raising its total investment to $39.5 million, exemplifies this shift. As CSR initiatives become more prevalent, they are expected to drive the sustainable finance market, which is anticipated to grow from $4 billion in 2023 to $5 billion in 2024, reaching $7 billion by 2028.
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Sustainable Finance Market Competitive Landscape
AXA Group, Bank of America Corporation, Citigroup Inc., The Hongkong and Shanghai Banking Corporation, BNP Paribas, Morgan Stanley Dean Witter Discover & Co., Internationale Nederlanden Group, Mitsubishi UFJ Financial Group, UBS Group AG, Goldman Sachs Group Inc., Barclays plc, Sumitomo Mitsui Financial Group Inc., Aviva plc, Credit Suisse Group AG, BlackRock Inc., Standard Chartered plc, Nomura Holdings Inc., Natixis SA, Northern Trust Corporation, Amundi SA, Macquarie Group Limited, Legal & General Group plc, State Street Global Advisors, Robeco
Key Sustainable Finance Market Trend
Major players in the sustainable finance market are focusing on adopting innovative practices to achieve a competitive advantage. Sustainable finance innovation encompasses developing new financial products and strategies that prioritize environmental, social, and governance (ESG) criteria. In April 2024, Ernst & Young Global Limited established a Sustainable Finance Innovation Hub in Dublin, aimed at assisting financial institutions globally to navigate the complexities of ESG compliance and enhance their sustainable finance strategies.
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Sustainable Finance Market Segmentation
The sustainable finance market covered in this report is segmented –
1) By Investment Type: Equity, Fixed Income, Mixed Allocation, Other Investment Types
2) By Transaction Type: Green Bond, Social Bond, Mixed-Sustainability Bond, Environmental, Social And Governance (ESG) Integrated Investment Funds, Other Transaction Types
3) By Investor Type: Institutional Investors, Retail Investors
4) By Industry Vertical: Utilities, Transport And Logistics, Chemicals, Food And Beverage, Government, Other Industry Verticals
By Geography:The regions covered in the sustainable finance market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.
North America was the largest region in the sustainable finance market in 2023. Asia-Pacific is expected to be the fastest-growing region in the forecast period.
The Sustainable Finance Global Market Report 2024 furnishes information about the global sustainable finance market, encompassing details like market size, projections for growth, segmentation across various sectors and regions, and an overview of competitors, including their revenues, profiles, and market shares. Furthermore, the report pinpoints potential opportunities and strategic directions derived from market trends and the strategies adopted by key competitors. The report also offers an assessment of how the COVID-19 pandemic, the Russia-Ukraine conflict, and increasing inflation have affected both global and regional markets, furnishing valuable strategic insights for businesses.
