1.1 Definition and presentation
ESG (Environmental, Social and Governance)finance has become increasingly essential over the years, as the IPCC's warnings to massively reduce greenhouse gas emissions to keep global warming below 1.5°C become ever more pressing.
Meanwhile, investor enthusiasm for ESG-labeled assets continues unabated, with the European Securities and Markets Authority (ESMA) producing a report in 2022 highlighting the outperformance of ESG funds, particularly those with the most stringent requirements:
- The value of impact funds grew by 4% over the decade 2010-2020;
- Other ESG strategies saw their asset values increase by 2%;
- Strategies that simply exclude certain sectors grew by 1.7%.
The ESG finance market is governed by a set of standards, proposed by international associations or state institutions. At present, these regulations are not very restrictive, but they are set to become even more so with the gradual implementation of the European Taxonomy, and the impetus it gives to financial players worldwide.
This new trend in the financial markets means new opportunities for a number of players, who will have to deploy a variety of new activities:
- ESG risk management, which is already being taken up by consulting firms;
- ESG reporting, which European companies will gradually have to comply with;
- Green bond issuance, which will become increasingly stringent and a central issue for banks.
1.2 Global market
According to the Global Sustainable Investment Alliance, the sustainable finance market was worth US$** tr illion in ****. According to Deutsche Bank, this market is expected to grow at a CAGR of +**% per year until ****, allowing us to estimate its size at US$*** trillion. These figures correspond to the capital invested in ...
1.3 Domestic market
The French ESG finance market is very dynamic, particularly in recent years. It is the leading market in Europe, with **% of European ESG funds managed in France, whereas France's share of total assets under management is only **%. In addition, over **% of French investment funds have set sustainability objectives. [***]
assessment of the ...
1.4 Weight of France and Europe in ESG bond issues
Over the years, Europe has established itself as the world leader in ESG finance. By ****, almost half of all green bond issues were in euros.
Share of global green bond issuance in euros World, ****, % (***) Source: ****
With regard to ESG bonds in general, we can draw up a table summarizing the cumulative ...
1.5 The European Union's green recovery plan in response to the Covid crisis
In response to Covid-** and the climate crisis, the European Union has drawn up a climate investment plan, directing capital from a wide range of institutions, both public and private. This massive channelling of capital into sustainable investments reassures investors about this asset class, and should drive a broad-based change in ...
2.1 A majority of French people are interested in sustainable development when it comes to their financial choices
**% of French people are aware of sustainable development issues and pay attention to them.
How important are sustainable development issues to you? France, ****, %, %, %, %, %, %, %, %, %, %, %, % Source: ****
To a lesser extent, the French are convinced that savings and finance have a role to play in these issues, with **% of them orienting their savings and ...
2.2 Security and profitability remain French investment priorities
Only *% of French people place SRI criteria at the top of their list of investment priorities. However, **% include them in their top * criteria. The top * criteria remain the security of the financial product (***).
In fact, a CSA survey commissioned by Amf shows that the choice of SRI investment is directly linked ...
2.3 Profile of ESG investment holders
The **-** age group is over-represented among ESG investors: **% of them own ESG investments, compared with **% of the rest of the population. According to a **** KPMG study, this generation is in search of meaning, which explains why **% of this age group would like to develop their knowledge of ESG investing. What's ...
3.1 Increased credit risk for vulnerable sectors
The consequence of taking ESG data into account in economic forecasts is to redirect capital away from sectors that are less compatible with sustainability requirements, towards more virtuous sectors. The sectors listed below will therefore be the first to bear the brunt of exclusion strategies adopted by investors seeking to develop ...
3.2 ESG bond issuance by type of player
In Q* ****, the quantity of sovereign green bonds issued was double that of the previous year, reaching **% of total green bond issuance. The biggest issuers in Q* **** were corporates, responsible for **% of issues. Indeed, large companies, such as those in the energy sector like Iberdrola or Enel, regularly issue bonds worth ...
3.3 Extra-financial indicators essential for evaluating a company
The following extra-financial indicators are essential for evaluating companies of all sizes: Pillars Themes Essential ESG indicators Environment Climate / Green share Green share of sales in taxonomy Resources / Water Volume of water used or recycled Resources / Energy Total energy consumption Human capital Skills development Total training budget by legal entity Workforce ...
4.1 Types of ESG financial products
Since ****, life insurance contracts have been required to include at least one SRI fund. Sustainable investments are also developing rapidly in employee savings funds, pension funds and real estate funds such as SCPIs. The governance dimension of ESG can also be found in shareholder engagement, which refers to dialogue policies within ...
4.2 ESG data providers: a multitude of offers available
ESG data and service providers have developed from players in different industries.
The sector is also undergoing consolidation. The latest acquisitions are Sustainalytics by Morningstar and RobecSAM by S&P.
We will distinguish six main categories of ESG offerings and services, identified in the Deloitte report on ESG data ...
5.1 European and French regulations defining the transparency framework for ESG information
European and French legislation has gone to great lengths to establish a transparency framework, notably to identify activities relating to fossil fuels. The European Regulation (***).
the European SFDR has been extended by Article ** of the French Energy-Climate Law.
5.2 A European framework under development: the Taxonomy and the tools to implement it
In addition to the publication of non-financial information, the European regulatory framework is based on two pillars:
The European Taxonomy
Adopted on June **, ****, the regulation is soon to be revised to include gas and nuclear, as transition technologies. This is a common classification of economic activities aimed at achieving environmental objectives, ...
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The wealth management market - France
L'étude de Businesscoot m'a permis de bien dégrossir le marché sur le plan macro, en résumant les grandes tendances, pour un coût acceptable ! Merci, cela a pu contribuer à appuyer mon projet!
Merci beaucoup Nicolas pour votre commentaire :)
The wealth management market - France
Publicado en 21/11/2022 by Sylvain Lorman - Avocode SAS
J'ai trouvé la plupart des informations recherchés. J'aurais toutefois souhaité trouver un peu plus de profondeur sur certains aspects
The wealth management market - France
Statistical study a little succinct but satisfactory and serious It lacks comparisons in terms of figures (assets, inflows, by product) between the global market (including bank-insurance) for asset management and that of the CGP CIF brokers
The mortgage brokerage market - France
Publicado en 29/04/2022 by Cédric AUBOIRON - PROLOGIA
Quickly obtained and appreciable synthetic approach. For all that, the content remains quiterelevant!