For the past few months, the team have been working with the Global Sustainable Investment Alliance and their respective regional bodies to produce the Global Sustainable Investment Review 2022 (GSIR 2022), which you can access below.
The headline finding from the report is that there is USD $30.3 trillion invested globally in sustainable investing assets.
The Review provides a global overview of the state of sustainable investing in major financial markets. Bringing together financial data from Japan, Australia and New Zealand, USA, Canada, and Europe, the Review has revealed some encouraging trends in the world of sustainable investing, while also highlighting persistent and emerging challenges.
Our data analysis and interviews made it clear that the industry is witnessing a significant maturing, with tighter definitions of when a fund can be labelled ‘sustainable’. Several of the organisations who provide financial data for the report have made significant changes to their methodologies over the past years to reflect this ongoing raising of standards. As a result of the US SIF’s methodology change, the report finds a drop from $17tn in reported AUM in the United States in 2020 to $8.4tn in 2022.
A significant and positive trend that emerged in the Review was that investors are increasingly making use of corporate engagement and shareholder action to drive corporate change and reduce sustainability-related investment risks. This reflects a growing recognition of the twin crises of climate and biodiversity, and investors understanding of the key role they can play in addressing these crises.
Although these findings show movement in the right direction, we still have a long way to go in limiting global warming to 1.5 degrees. UNEP released their Emissions Gap Report 2023 this month, reporting once again that emissions have hit new heights, and once again countries have failed to deliver on their Paris Agreement commitments. Unsurprisingly, they have titled the report ‘Broken Record’.
On Thursday 30th November, COP28 will commence in UAE. The first Global Stocktake, a comprehensive assessment of progress since the adoption of the Paris Agreement will take place at this COP. In light of the failure to limit rising emissions, it is good to see, for the first time, policy recommendations in the Global Sustainable Investment Review. These recommendations cover the importance of creating net zero investment opportunities to unlock investment, enhancing data availability, reconciling regulatory efforts, and recognising the important role of nature and biodiversity in addressing the climate crisis.
We really enjoyed working on this report and would like to thank the contributors from each region, the GSIA team and the design team at Blush, who made this report possible.
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