Investors See Growth In ESG And Climate Strategies

Nearly 85% of global investors expect the assets managed under environmental, social, and governance (ESG) strategies to grow over the next two years. This shows that sustainable investing is becoming more important, despite political debates and market uncertainties. Bloomberg Intelligence’s latest ESG Investor Survey, which included 252 investment professionals from North America, Europe, Asia-Pacific, Central America, and South America, revealed this trend. All participants had at least eight years of experience, offering insights from long-term involvement in financial markets.

The survey shows that ESG is no longer just about compliance or reputation. Instead, it's seen as a way to boost competitiveness, innovation, and revenue growth. Almost half of those surveyed said that by 2027, more than 15% of their portfolios will focus on ESG investments. A similar number expect to allocate the same portion to climate-focused products. This suggests that despite political scrutiny and concerns about “greenwashing,” sustainable finance is gaining real momentum.

Eric Kane, Director of ESG Research at Bloomberg Intelligence, and Melanie Rua, Senior Associate Analyst, said institutional investors still see ESG strategies as important for better decision-making and managing risks. “Our findings show that despite recent controversies, institutional investors continue to assign long-term value to ESG strategies,” they said. The survey highlights that ESG is moving from a niche area to a mainstream investment approach with growing market importance.

One key finding is the strong focus on climate strategies. Nearly 90% of respondents said they actively check the carbon footprint of their portfolios, showing that climate factors are now a big part of investment decisions. Investors believe companies with solid energy transition plans are better placed to gain market share and stay competitive. According to the survey, 71% expect these companies to improve their market position, and 59% see potential for increased revenue from being ready for the energy transition. This shows climate adaptation and reducing emissions are now seen as not just ethical needs but real business opportunities.

However, there are still challenges. Almost two-thirds of investors pointed out major gaps in the availability and quality of climate-related data. Important areas like scenario analysis, Scope 3 emissions reporting, and physical risk assessments are not well developed, making it harder to fully understand risks and opportunities. The lack of standard methods and the complexity of global reporting rules add to the problem. These data issues make it difficult for investors to fully include climate factors, causing frustration. Still, the demand for better disclosures means companies, regulators, and data providers will likely face more pressure to improve transparency.

Besides climate, the survey also highlights new areas of ESG focus that could shape future investments. Artificial intelligence (AI) and cybersecurity are quickly rising on the ESG agenda. Over 45% of investors see AI as the next big theme, with cybersecurity close behind at 39%, and water issues at 25%. This shows investors are broadening their view of ESG beyond climate and governance to include tech and systemic risks.

AI is seen as both a big opportunity and a risk, making it a top priority for 2025. Investors want to see how AI can improve ESG analysis and decisions while being careful about ethical concerns, governance, and possible negative effects. Cybersecurity is also gaining attention as a key part of a company’s resilience, since breaches can harm financial results, reputation, and trust.

The survey, done by research platform Attest between March 26 and May 7, 2025, shows ESG is changing. On one side, investment in ESG is growing, climate strategies are viewed as a way to compete, and new themes like AI are getting more focus. On the other side, problems with data quality and standards still need fixing.

The results also show a bigger trend: sustainable finance is becoming part of the global capital markets, not just a separate category. For investors, the question isn’t whether ESG matters, but how to improve the tools, data, and strategies to make the most of it. The focus on carbon footprints, transition plans, and new areas like AI and cybersecurity means ESG investing is getting smarter and more connected to bigger tech and economic changes.

Looking ahead, the survey suggests ESG will stay important, not just for ethics or rules, but for its potential to give companies a competitive edge and deliver long-term returns. While data challenges remain, the growing focus on climate readiness and new technologies shows that ESG is becoming a lasting and growing part of global investment strategies.