by The global green bond market offers funding for environmentally friendly projects through fixed-income securities. Green bonds serve various sectors including renewable energy, energy efficiency, pollution prevention, environmentally sustainable management of living natural resources and land use, terrestrial and aquatic biodiversity conservation, and clean transportation. Investors are increasingly demanding green investments that positively impact climate change and environmental degradation.
The Global Green Bond Market size is estimated to be valued at US$ 552.5 Mn in 2024 and is expected to exhibit a CAGR of 8.5% over the forecast period 2024 To 2031.
Key Takeaways
Key players operating in the green bond market are Zimmer Biomet, Smith & Nephew, Stryker, DePuy Synthes, Orthofix, Bioventus LLC, DJO Global, Braun, Medtronic, and Globus Medical. These companies are actively funding environmental projects through issuance of green bonds.
The growing demand for sustainable investments is fueling the growth of the green bond market. Various organizations and investors are keen to allocate their funds in initiatives aimed at reducing carbon footprint. This rising interest in eco-friendly projects is encouraging more issuances of green bonds.
The global green bond market is also expanding significantly. While Western economies historically dominated the market, green bond issuances are increasing rapidly in developing nations as well. China has emerged as a major market for green bonds in recent years. Overall, the expanding global appeal of impact investing is supporting the worldwide growth of this sector.
Market Key Trends
One of the major trends in the green bond market is the issuance of sustainable debt linked to the UN Sustainable Development Goals (SDGs). A growing number of issuers are aligning their green bonds with specific SDGs like affordable and clean energy, climate action, life on land and below water to name a few. This allows investors to financing projects that directly support important global sustainability initiatives.
Porter’s Analysis
Threat of new entrants: Low barriers to entry due to not requiring extensive manufacturing facilities. However, established players hold large market shares.
Bargaining power of buyers: Large institutional investors have significant bargaining power due to the size of their investments.
Bargaining power of suppliers: Issuing entities and underwriters hold a degree of bargaining power due to their expertise in issuing and underwriting green bonds.
Threat of new substitutes: Potential threat from emerging investment instruments focused on sustainability outcomes.
Competitive rivalry: Intense competition among established players to attract large investments from institutional investors.
Geographical regions:
The US and China are currently the largest markets for green bonds in terms of value, together accounting for over 50% of total green bond issuance globally. China has seen the fastest growth recently driven by government policies supporting renewable energy development.
The Asia Pacific region excluding Japan and China is emerging as the fastest growing geographical market for green bonds. Countries like India are seeing increased issuance to fund renewable energy, green buildings, and other climate-related projects. Rapid urbanization and economic growth are increasing investments towards sustainability goals in the region.
*Note:
- Source: Coherent Market Insights, Public Source, Desk Research
- We have leveraged AI tools to mine information and compile it
About Author - Money Singh
Money Singh is a seasoned content writer with over four years of experience in the market research sector. Her expertise spans various industries, including food and beverages, biotechnology, chemicals and materials, defense and aerospace, consumer goods, etc. LinkedIn Profile
