How Mandatory ESG Reporting is Fueling a New Market

Emergence of the transition finance market

The corporate world is undergoing a seismic shift as environmental, social and governance (ESG) reporting becomes mandatory across major economies. What was once a voluntary effort to enhance corporate sustainability is now a core business imperative with wide-ranging impacts. At the forefront of this transformation is the rapid emergence of the transition finance market.

Photo by Stephen Dawson on Unsplash

Transition finance refers to the financing of entities in carbon-intensive sectors as they pivot their business models and operations to align with a low-carbon economy. Its rise is being propelled by the new ESG disclosure rules which are compelling companies to thoroughly measure, report and reduce their carbon emissions and environmental footprints.