One third of all assets under management by institutional and finance professionals today is in the field of Environmental, Social and Governance, otherwise known as ESG. This represents a 42% jump in just two years, a very significant leap that will likely continue to accelerate over the coming years.
The European Union is already moving quickly towards passing a green deal that is expected to become law in another year. Essentially, it will result in companies signing up to be net zero by 2050 and to commit to being halfway there by 2030 or 2035.
Many firms now require a game plan to achieve that target – a process that will involve them first becoming carbon neutral and then net zero. The impact of this legislation means a manufacturing company will not only need to be net zero itself, but any vendor it works with, will have to be net zero too.
This legislation will likely lead to a huge amount of activity in the demand for technology and science, whether hydrogen, nuclear power, or through battery technology. This in turn will create a major transition and a huge marketplace, and offers a significant opportunity for investment.
Through our own operations, Bank of America is committed to improving the environment in how we approach our global business strategy, work with partners, make our operations more sustainable, support our employees, manage risk and govern our activities. This includes working with His Royal Highness, The Prince of Wales, through his Sustainable Markets Initiative to accelerate the transition to a net-zero future. The bank has also committed an investment of more than $445 billion by 2030 to accelerate the transition to a more sustainable, low-carbon economy.