To reach the carbon neutrality objective by 2050, global clean energy spending has to increase to $4.5 trillion per year by 2030, with nearly half of this being dedicated to emerging markets. To support investments in clean energy infrastructure and technologies, the Inflation Reduction Act in the US and the Green Deal Industrial Plan in the EU aim to mobilise $400 billion in incentives and €300 billion in tax credits, respectively.
Sustainability issues will impact the economy, and our economic activities impact sustainability matters. Investors therefore need to address the investment context in a holistic manner to be profitable in the long run. While financial markets bear a higher level of complexity and uncertainty due to both the recent geopolitical and repeated extreme weather events, at Amundi we stand firm in our conviction that responsible investment delivers long-term value to our end-savers.
Despite challenging market conditions, responsible investment flows have continued to increase (see graph below) and there are several favourable numbers and trends that should support its future development:
- 67% of global asset owners are convinced of the materiality of ESG factors.
- Thematic and impact strategies are expected to dominate the market in 2024 and onwards (a shift driven by investors who not only prioritise financial returns but also measurable environmental and social impact).
At the same time, the successful, long-term decarbonisation of the economy will bring significant social challenges. Social, climate and biodiversity issues cannot be considered in isolation. For example, around 78 million jobs are estimated to disappear due to the transition to a low-carbon economy, replaced by 103 million jobs that workers must be trained for. Companies will increasingly be asked to prove their commitment to a just energy transition for all stakeholders: workers, suppliers, communities and consumers.
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