Since the turnover of the White House and a new emphasis by the SEC to promote environmental social and governance and sustainable investment Wall Street has not only sought to comply but is full on embracing the movement. The street is now mobilizing trillions of dollars in investment towards clean energy investing and sustainability finance. Big banks have the room and are now piling in from advisory to, investment, to bond and credit financing instruments.
According to Refinitiv data the cumulative borrowing through green bonds, social bonds and sustainability bonds stood at $264 billion in the first quarter of this year.
JP Morgan Chase & Co. set a goal to finance $2.5 trillion in initiatives that combat climate change and advance sustainable development over the next 10 years. The bank’s commitment includes $1 trillion for projects that bolster cleaner energy sources
Citigroup said it will provide $1 trillion for financing sustainability efforts over the next nine years building on a previous commitment to finance $250 billion of sustainable activities by 2025. Half will go toward environmental projects, such as renewable energy, water conservation and sustainable agriculture.
Goldman Sachs has mobilized more than $100 billion in clean energy financing and investments, with a target to deploy $150 billion as well as underwriting over $4.5 billion in green, social and sustainability bonds.
These commitments go beyond just a nod to woke capitalism, its money simply following actionable and profitable investment trends being driven by policymakers, companies, and investors alike. The Federal government has set the tone that ESG and sustainability is now a focus through its regulators while other countries and states are setting aggressive policy goals to reduce reliance on fossil fuels and bigger than ever pushes towards renewables.
Investment banks recognize that in courting sovereign wealth funds and large private capital allocations that sustainable and green investment must now be part of the strategy.
The projected sustainable investment market size has been suggested to reach over $12 Trillion according to the European Business Review, and now Wall Street is actively advancing forward to make that market. These efforts began over a decade ago but now the acceleration is evident, and it seems more than fair to assume that the best is still yet to come.
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