Entries for 'ESG'

After a sharp decline in Q1 2024, global ESG fund flows registered modest improvement in Q2, though U.S. ESG funds continue to experience outflows. As energy become a major national security theme for major economies, strong growth in clean energy investment is anticipated in 2024 and beyond, driven by national industrial policies such as the U.S. Inflation Act (IRA), the EU Green Deal and similar incentive schemes around the world.

The ESG debt universe topped $6.5 trillion in H1 2024, up from $5.4 trillion a year ago. ESG debt issuance was over $700 billion in H1 2024, broadly stable vs. H1 2023.

2024 is poised for strong growth in clean energy investment, with continued support from the U.S. Inflation Reduction Act (IRA), the EU Green Deal, and similar incentive schemes around the world.

The ESG debt universe topped $6.3 trillion in Q1, up from $5.1 trillion a year ago and is expected to surpass $6.5 trillion by mid-2024. While early Q2 has been slower, the first three months of 2024 saw a sharp rebound in ESG debt issuance, coming in at over $350 billion—the majority in green bonds.

Global debt rose by some $1.3 trillion to a new record high of $315 trillion in Q1 2024. Moreover, after three consecutive quarters of decline, the global debt-to-GDP resumed its upward trajectory in Q1 2024.

On Thursday, April 18, the IIF submitted a comment letter in response to a European Banking Authority (EBA) Consultation Paper on Draft Guidelines on the management of ESG risks.

In 2023, frontier market (FM) accumulated some $20 billion of new debt, bringing the total to $3.5 trillion. For the first time since 2020, the FM debt-to-GDP ratio increased, as growth and inflation subsided.

Nature and biodiversity are emerging as critical areas of market focus, attracting increasing attention from corporates, financial institutions, and policymakers.

Global climate flows surpassed $2 trillion in 2023—up from $1.4 trillion in 2022. While still well short of the estimated $8.1 trillion annual pace needed to achieve net-zero emissions by 2050, the pickup reflects the strong growth in climate finance commitments in recent years.​

Early 2024 saw a sharp surge in ESG fund flows, driven by a rally in tech shares (which are heavily weighted in ESG indices given their high ESG scores). In February, inflows to ESG fixed income funds reached their highest in over a year. Looking ahead, a synchronized series of rate cuts by major central banks could have a positive impact on ESG fund flows, particularly in the second half of 2024.

Over $15 trillion was added to the global debt mountain last year, bringing the total to a new record high of $313 trillion. The global debt-to-GDP ratio declined for a third consecutive year, largely driven by mature markets.

The ESG-labelled debt universe grew by 25% in 2023, nearing $6 trillion. However, this is still less than 2% of the global debt universe—policy support, including from the G20 Brazil Presidency, could support substantial market expansion.

Global climate flows are on track to surpass $2 trillion in 2023—up from $1.4 trillion in 2022. While still well short of the estimated $8.6 trillion annual pace needed to achieve net-zero emissions by 2050, the pickup reflects the strong growth in climate finance commitments in recent years.

Global debt reached a staggering $307 trillion in Q3 2023, with a big increase across the board in both mature markets (U.S., Japan, France, and the UK) and emerging markets (China, India, Brazil, and Mexico).

The ESG debt universe has expanded by $1.1 trillion over the past four quarters, surpassing $5.6 trillion in Q3 2023.

Rising global tensions and political divides could hinder multilateral efforts to achieve sustainable development goals. Global economic performance remains subdued, with significant regional disparities; a contributing factor has been the prolonged stagnation in global capital flows over the past 15 years amid post-financial crisis regulatory initiatives.

After reaching an all-time high of $3.5 trillion in Q1 2023, total debt in frontier markets (FM) saw a slight decline in Q2 2023.