Global Sustainable Finance Market Size to worth USD 42.1 Trillion by 2033: Market Report 2023-2033

RELEASE DATE: Feb 2025 Author: Spherical Insights
The Global Sustainable Finance Market Size is Expected to Grow from USD 5.2 Trillion in 2023 to USD 42.1 Trillion by 2033, at a CAGR of 23.26% during the forecast period 2023-2033.

Table of Contents

Historical Data, Premium Insights, Market Dynamic, Analysis and Projection, By Product, Analysis and Projection, By Application, Analysis and Projection, By End-Use, Analysis and Projection, By Regional Analysis, Competitive Landscape, Company Profiles, Market Revenue, Sale & Price Analysis


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Global Sustainable Finance Market Size to worth USD 42.1 Trillion by 2033

According to a research report published by Spherical Insights & Consulting, the Global Sustainable Finance Market Size is Expected to Grow from USD 5.2 Trillion in 2023 to USD 42.1 Trillion by 2033, at a CAGR of 23.26% during the forecast period 2023-2033.

 

Browse key industry insights spread across 210 pages with 110 Market data tables and figures & charts from the report on the Global Sustainable Finance Market Size, Share, and COVID-19 Impact Analysis, By Asset Class (Equities, Fixed-income, Multi-asset, and Alternatives), By Offerings (Equity Funds, Bond Funds, ETFs/Index Funds, and Alternatives/Hedged Funds), and By Region (North America, Europe, Asia-Pacific, Latin America, Middle East, and Africa), Analysis and Forecast 2023 – 2033.

 

Sustainable finance refers to the practice of incorporating environmental, social, and governance (ESG) factors into financial decision-making. The primary objective of sustainable finance is to promote long-term sustainable development by increasing investments in sustainable projects and economic activities. By doing so, sustainable finance helps manage sustainability risks and aligns with society's expectations for a more sustainable economy. Additionally, it facilitates the redirection of investments toward sustainability goals. The growth of the sustainable finance market is influenced by several factors. Consumers and investors are increasingly aware of the effects their financial decisions have on the environment and society. There is a growing demand for businesses to operate responsibly and sustainably, alongside delivering financial returns. Furthermore, governments are implementing policies and regulations to support sustainable finance, such as the European Union's Green Deal and the Sustainable Finance Disclosure Regulation (SFDR). Major asset managers are also promoting ESG-focused investment strategies, and advancements in financial technologies like blockchain are enhancing the tracking and reporting of ESG practices. However, the sustainable finance market also faces challenges. There is currently no globally recognized framework for sustainability, which complicates the comparison and evaluation of the sustainability performance of various companies and investments. Additionally, sustainable finance investments are often concentrated in specific sectors, such as renewable energy, clean technology, and sustainable infrastructure, making portfolios more susceptible to risks associated with those industries.

 

The equities segment is predicted to hold the largest market share through the forecast period.

Based on the asset class, the sustainable finance market is classified into equities, fixed-income, multi-asset, and alternatives. Among these, the equities segment is predicted to hold the largest market share through the forecast period. Primarily due to its historical performance and the increasing investor desire for higher returns. As stock markets keep recovering and expanding, investors are more attracted to equity investments, which generally provide greater capital appreciation compared to fixed-income assets. Additionally, the emergence of technology-driven trading platforms has made equity investments more accessible, encouraging broader participation from both retail and institutional investors. This trend is likely to maintain the prominence of equities in the market landscape.

 

The equity funds segment is anticipated to hold the highest market share during the projected timeframe.

Based on the offerings, the sustainable finance market is divided into equity funds, bond funds, ETFs/index funds, and alternatives/hedged funds. Among these, the equity funds segment is anticipated to hold the highest market share during the projected timeframe. This is driven by a blend of strong performance and investor preference for professionally managed portfolios. Equity funds, which aggregate resources to invest in a varied range of stocks, offer investors the potential for substantial returns while reducing individual investment risks. Moreover, the growing awareness of the advantages of diversification and a positive outlook on equity markets across different sectors are expected to increase demand for equity funds. As investors aim to take advantage of market opportunities, equity funds are anticipated to be essential in asset allocation strategies.

 

North America is estimated to hold the largest share of the sustainable finance market over the forecast period.

North America is estimated to hold the largest share of the sustainable finance market over the forecast period. This is largely due to its well-established financial framework and increasing regulatory support for sustainable initiatives. The financial institutions in the region are progressively incorporating environmental, social, and governance (ESG) criteria into their investment and lending practices, reflecting a wider transition towards responsible investing. Furthermore, the presence of leading asset managers and a strong commitment from corporations to adopt sustainable practices are driving considerable capital flows into sustainable finance products, establishing North America as a frontrunner in this evolving market.

 

Europe is expected to grow the fastest during the forecast period. This is driven by strict regulatory frameworks and a strong dedication to sustainability among its member states. The European Union's ambitious climate objectives and initiatives, such as the European Green Deal, are driving significant investments in green technologies and sustainable projects. Additionally, European investors are increasingly placing importance on sustainability in their investment choices, resulting in a surge in demand for green bonds and sustainable financial products. This proactive approach to sustainable finance, coupled with rising public awareness and support for environmental initiatives, positions Europe for swift growth in this sector.

 

Competitive Analysis

Major key players in the sustainable finance market BlackRock, Inc., State Street Corporation, Morgan Stanley, UBS, JPMorgan Chase & Co., Franklin Templeton Investments, Amundi US, The Bank of New York Mellon Corporation, Deutsche Bank AG, Goldman Sachs, and Others.

 

Recent Developments

  • In April 2024, Professional services firm EY has announced the launch of a new Sustainable Finance Innovation Hub to support financial institutions worldwide in meeting their ESG (Environmental, Social, and Governance) regulatory and reporting requirements. Located in Dublin, this new hub plans to add 40 specialists over the coming months, significantly increasing the size of EY Ireland's existing sustainable finance team. The expansion will more than triple the team's capacity in this area. Additionally, the hub will be enhanced by professionals with sustainability expertise from Europe, Asia-Pacific, and the United States.

 

Key Target Audience

  • Market Players
  • Investors
  • End-users
  • Government Authorities 
  • Consulting And Research Firm
  • Venture capitalists
  • Value-Added Resellers (VARs)

 

Market Segment

This study forecasts revenue at global, regional, and country levels from 2023 to 2033. Spherical Insights has segmented the sustainable finance market based on the below-mentioned segments:

 

Global Sustainable Finance Market, By Asset Class

  • Equities
  • Fixed-income
  • Multi-asset
  • Alternatives

 

Global Sustainable Finance Market, By Offerings

  • Equity Funds
  • Bond Funds
  • ETFs/Index Funds
  • Alternatives/Hedged Funds

 

Global Sustainable Finance Market, By Regional Analysis

  • North America
    • US
    • Canada
    • Mexico
  • Europe
    • Germany
    • UK
    • France
    • Italy
    • Spain
    • Russia
    • Rest of Europe
  • Asia Pacific
    • China
    • Japan
    • India
    • South Korea
    • Australia
    • Rest of Asia Pacific
  • South America
    • Brazil
    • Argentina
    • Rest of South America
  • Middle East & Africa
    • UAE
    • Saudi Arabia
    • Qatar
    • South Africa
    • Rest of the Middle East & Africa

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