The Rise of ESG Investing: Global Trends and Opportunities in the Indian Market

Environmental, Social, and Governance (ESG) investing has emerged as a transformative trend in global financial markets. As the world grows more conscious of sustainability, investors are moving away from traditional profit-driven strategies towards investments that align with broader social and environmental values.

Introduction

Environmental, Social, and Governance (ESG) investing has emerged as a transformative trend in global financial markets. As the world grows more conscious of sustainability, investors are moving away from traditional profit-driven strategies towards investments that align with broader social and environmental values. This shift has impacted global financial systems and is gaining traction in emerging markets like India. With its expanding economy and increased awareness of sustainability issues, India is poised to play a significant role in ESG investing. This article explores global trends, ESG's growth in India, and the challenges and opportunities ahead.

Global Trends in ESG Investing

Exponential Growth in ESG Assets As of 2023, the Global Sustainable Investment Alliance (GSIA) reported that global sustainable investment assets had grown to $42 trillion, accounting for approximately 38% of all professionally managed assets. This growth highlights the increasing focus among investors on their investments' environmental and social impact. Europe remains a leader in ESG investments, with nearly half of all managed assets being sustainable. North America, too, continues to grow, with sustainable assets reaching $21.6 trillion in 2022, reflecting a 50% increase from 2020.