Investors Continue to Back Sustainability, Reports Confirm
Despite geopolitical uncertainty and shifting regulatory landscapes, institutional investors remain firmly committed to sustainability, according to recent insights from BNP Paribas and J.P. Morgan. Their 2025 reports highlight how ESG investing is evolving, from strategy to execution, and how capital continues to flow toward decarbonization and climate innovation.
BNP Paribas Institutional Investor ESG Survey
A recent BNP Paribas survey of 420 institutional investors across 29 countries representing $34tr in AUM found that investors are continuing to pursue sustainable investment despite the ongoing political backlash. An overwhelming 87% of respondents said their ESG goals remain unchanged, 74% said they prioritize portfolio decarbonization and social issues equally, and fewer than 3% said they plan to scale back on their ESG commitments. However, many also noted that they have adopted a more discreet approach – nearly half of the group retaining their commitments said they had become less vocal about their plans due to reputational concerns.
The survey highlights a shift from broad ESG frameworks to more targeted thematic strategies, such as climate resilience, biodiversity and social equity. Notably, 49% of investors reported plans to increase allocations to energy transition assets and 46% said they will invest in low-carbon assets and divest from high-carbon assets. The survey also reports that private capital managers are increasingly supporting ESG and sustainability.
J.P. Morgan Sustainability - The Long View Report
Meanwhile J.P. Morgan Equity Research reports a massive opportunity for European asset managers in sustainable investment. Their recent Sustainability – The Long View Report highlights a $11.7 trillion opportunity for European asset managers to align with asset owners’ growing demand for sustainable investing.
The report emphasises that asset managers who embed sustainability in their investment processes are best positioned to capture this capital shift. Recent examples of firms making this shift include The People’s Pension (TPP) which redirected £28 billion from State Street to Amundi and Invesco on account of their alignment with its climate priorities as well as CalSTRS which awarded $450 million to Nordea and $150 million to Ninety One, also based on their sustainability commitments.
JP Morgan’s Sustainability – The Long View Report also highlights asset owners who are actively reassessing their sustainability allocations including New York City Pension Funds ($279bn AUM), PGGM ($280bn AUM), PME ($65bn AUM), and AP7 ($110bn AUM).
Finally the report notes that the US backlash could be a positive for European asset managers and suggests that regulations such as SFDR 2.0 could help to drive the European sustainable finance market, which it believes will become more targeted, thematic, and performance-driven.
Conclusion
Together the reports highlight a similar trend defined by a deepening of understanding around sustainable investment, and not so much a shift away from ESG and sustainability amongst investors, but instead a more mature approach that defies the so-called backlash and focuses on more specific strategies such as climate technology, energy transition, and nature.
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