The $10 Trillion Sustainability Centric Market How ready are you to capture the opportunity?
In recent years, there has been a trend in the emergence of sustainability-centric businesses in the market given the dwindling environmental conditions. With a major flow of VC funding and customer sentiments, the new-age startups and businesses are relentlessly pursuing the idea to build services/products in line with the ideas of sustainable development. Here’s an overview of what’s happening and why.
Sustainable Development is defined as the development that meets the needs of the present without compromising the ability of future generations to meet their own needs.
The climate change picture is grim: To limit the temperature increase below 2°C as per the Paris Agreement, there is a need to decarbonise at a rate of around 13% a year, over eight times the rate historically achieved since 2000.
Around 80% of consumers have been found to change their purchasing behaviour based on standards of sustainability.
For the past five years, there has been a 71% rise in online searches for sustainable goods globally.
Sustainability-centric market possesses a whopping $10 Trillion business opportunity
The funding scenario is ever-booming: Investment in European Sustainability Startups increased to €8.8 billion in 2021 from €4.7 billion in 2020
Venture Capitalists are heavily investing in ESG; 200% year-over-year (YoY) growth has been seen for climate-tech investment levels.
The Green Bonds (Debt Instrument to exclusively finance green Projects) Market accounted for $270 Billion at the end of 2020, marking the highest since its market inception in 2007.
Under the pressure to act on climate change, businesses and investors are readily pivoting towards sustainable development practices.
Large international conglomerates and fossil fuel enterprises are investing capital in green technology and solutions: Nestle runs an accelerator for sustainable food companies; P&G is a limited partner in Circulate Capital, a climate-driven VC fund; 12 companies representing 30% of global operated oil and gas production runs Oil and Gas Climate Initiative (OGCI) to invest in companies focussed on reducing carbon footprint.
With higher consumer interests and major initiatives, existing businesses and novel ones should be considering a strategic shift toward sustainable development solutions
Reach out to us to discuss the approach of your business in this sphere.
Source : UN World Commission on Environment and Development, EIU, Future of Nature and Business Report, State of European Tech 2021, Climate Bonds Initiative, PwC.