Mapping climate‑related metrics in the financial sector

3. Assessing financial institutions’ net-zero commitments

3.1. Assessing existing targets and net-zero commitments

Financial institutions’ GHG emission reduction targets vary in terms of their comprehensiveness, ambition, and feasibility. These factors are relevant to assessing the credibility and effectiveness of a financial institution’s climate-related commitment.

To gauge ambition and enable comparisons between companies, annual reduction metrics encompass key target-specific data. The annual reduction is calculated by dividing the rate of emissions change by the time span between the base year and the target year. Considering all the data gaps, it is only possible to calculate annual targeted reduction rates for a limited number of financial institutions.

On average, listed financial institutions aim to reduce their scope 3 GHG emissions at an annual rate of 4.3% globally (Figure 3.1). Europe leads with the most ambitious emission reduction targets of scope 3 GHG emissions, with financial institutions pursuing an average annual reduction rate of 5%. The higher average may be partly explained by the small size of the sample. In addition, while short-term targets may be high, long-term targets may tend to lower the level of ambition, due to a decrease in the company’s carbon budget. Availability and data quality are crucial elements to assess net-zero commitments of financial institutions.

Figure 3.1 measures the average annual reduction of GHG emissions based on data collected from Bloomberg after applying quality checks (see Annex A for further details on the methodology used). The analysis considers only scope 3 GHG emission targets, integrating total GHG emission targets when the company’s scope 3 GHG emissions account for at least 80% or higher percentage of the total GHG emissions.

Figure 3.1.  The average annual GHG emission reduction rate of scope 3 GHG emissions, 2024

Note: The average annual reduction rate of absolute emissions is calculated based on 164 listed financial institutions that disclosed reduction targets for scope 3 GHG emissions. The inclusion of only one country and two regions is due to a lack of data availability.

Source: OECD Corporate Sustainability dataset, Bloomberg. See Annex A for details.

International organisations and initiatives often set 2030 and 2050 as target years to coordinate global efforts towards sustainable development. For example, the United Nations has set 2030 as the target year to achieve the 17 Sustainable Development Goals, while some international climate agreements, such as the Paris Climate Agreement, have set 2050 as the target year for achieving net-zero carbon emissions globally.

Globally, among the listed financial institutions that have disclosed their GHG emission reduction target, 86% disclosed the target year. Half of them have set their reduction target year as 2030 (28%) or 2050 (27%), accounting for 64% of total assets owned and managed (Figure 3.2). Only a small portion by number of companies disclosed targets between 2030 and 2050 (12%) and after 2050 (3%). Less than 17% of the target years were set before 2030.

Figure 3.2.  Target year of the existing GHG emission reduction targets, 2024

Note: The analysis includes information from 783 listed financial institutions disclosing the target year. The “Before 2030” category includes financial institutions that set the target year between 2024 and 2029. The “2030 – 2050” category includes financial institutions that set the target year between 2031 and 2049. The “After 2050” category includes financial institutions that set their target year from 2051 onwards.

Source: OECD Corporate Sustainability dataset, MSCI, LSEG, Bloomberg. See Annex A for details.

Comprehensiveness reflects the extent to which a company’s targets address its total emissions. A company may set multiple targets, each covering different portions of its emissions. By comparing the baseline emissions with the company’s GHG emissions at the time of the target setting, the comprehensiveness of its strategy can be evaluated. On a global scale, the emission reduction targets of scope 3 GHG emissions set by listed financial institutions cover 55% of the total reported GHG emissions among the institutions that have disclosed a GHG emission reduction target (Figure 3.3). Emissions reduction targets of scope 3 GHG emissions are most comprehensive in Europe and the United States, where listed financial institutions, on average, cover 65% and 61% of their reported scope 3 GHG emissions within their reduction goals, respectively. Emerging and Developing Asia excl. China (51%) and Middle East and Africa (49%) follow.

Figure 3.3.  Reported scope 3 GHG emissions covered by financial institutions’ targets on scope 3 GHG emissions, 2024

Note: The disclosure of the coverage of GHG emission reduction targets is based on available information from 197 listed financial institutions that disclosed GHG emission targets. China and other economies are not represented in the figure due to the limited number of financial institutions disclosing reduction targets for financed emissions.

Source: OECD Corporate Sustainability dataset, Bloomberg. See Annex A for details.

The feasibility of GHG emission targets can be assessed by determining whether a company has met its past targets and whether it is on track to meet its current stated targets. To measure this progress, reported scope 3 GHG emissions in 2024 are compared against the projected pathway of each financial institution’s GHG emission reduction.

There is an inherent trade-off between the feasibility of emission reduction targets and their comprehensiveness and ambition. Financial institutions may struggle to meet their targets if those targets are overly ambitious and all-encompassing.

Globally, among the financial institutions that have set emission reduction targets of scope 3 GHG emissions, 65% have not met their targets, and only 35% have met the committed targets, assuming that there is a linear reduction path (Figure 3.4)

In all regions except Latin America, over 60% of financial institutions that have set emission reduction targets of scope 3 GHG emissions are not on track to meet them, suggesting that the targets may have been too ambitious or that decarbonisation efforts have fallen short.

Latin America demonstrates the highest feasibility for meeting scope 3 emission reduction targets among listed financial institutions. Almost half of these institutions have successfully met their targets of scope 3 GHG emissions.

Figure 3.4.  Progress of listed financial institutions in reaching the scope 3 reduction target, 2024

Note: The disclosure of the progress of listed financial institutions in reaching the emission reduction target is based on available information from 505 listed financial institutions that disclosed both reduction targets of scope 3 emissions and GHG emissions in 2024. To measure this progress, the company’s GHG emissions in the current reporting year of the target are compared with the projected value following a linear pathway between the base year emissions and target year emissions. Targets must be set in years beyond 2024. In the figure, China is excluded from the analysis due to a lack of data.

Source: OECD Corporate Sustainability dataset, Bloomberg. See Annex A for details.

In Figure 3.5, GHG emission projection without targets considers the 2024 reported GHG emissions and assumes a business-as-usual default 0.7% annual growth in absolute emissions. This rate was the annual growth rate in the GHG emissions associated with combustion of fossil fuels from 2012 to 2022 globally (IEA, 2024[15]). Conversely, GHG emission projection with targets is the company's projected GHG emissions in tons of CO₂e for the specific year, taking any considered climate target at face value. These emissions are projected by taking into account the reported GHG emissions of 2024 and the company's pledged climate targets to reduce GHG emissions, if available (see Box 3.1 and Annex for further details on the methodology used).

Overall, the projected emissions with targets show a rapid decline in the short term (Figure 3.5). By 2050, the projected GHG emissions with targets for scope 1, scope 2, and scope 3 are estimated to represent 10%, 25%, and 22%, respectively, of the 2024 emission levels.

The reduction rates for the projected GHG emissions with targets are more ambitious from 2024 to 2030 than from 2030 to 2050. Projected pathways progression after 2030 slows down because, for some financial institutions, targets are only available up to 2030 and complementary ones in the longer term are not. Between 2024 and 2030, the annual reduction rates are expected to be 6% for scope 1, 10% for scope 2, and 7% for scope 3. From 2030 to 2050, these rates increase to 9% for scope 1, but decrease to 3% and 5% for scope 2 and scope 3, respectively.

Figure 3.5.  Projected pathway of GHG emissions of listed financial institutions, 2023-50

Note: The disclosure of the emission projected pathways is based on available information from 1 135 and 38 listed financial institutions for which scope 1 and 2 projections and scope 3 projections are available, respectively.

Source: OECD Corporate Sustainability dataset, Bloomberg. See Annex A for details.

Box 3.1. Projection of the GHG emissions

Projection of GHG emissions with targets

Figure 2.5 presents a forward-looking projection of GHG emissions based on the emission reduction targets disclosed by listed financial institutions. In 2024, the institutions’ most recent reported GHG emissions are used. For the years 2025 to 2050, emissions are estimated based on the disclosed targets. Any gaps between the reported 2024 emissions and the targeted emissions in the specified target years are bridged using a linear interpolation model.

Projection of GHG emissions without targets

To provide a comparative analysis of forward-looking GHG emissions, Figure 2.5 also models a scenario where companies with disclosed reduction targets do not pursue any emissions reduction commitments. This projection without targets illustrates a business-as-usual pathway, assuming no actions are taken to achieve low-carbon goals. In this scenario, a default annual growth rate of 0.7% in absolute emissions is applied, reflecting the global average increase in GHG emissions from fossil fuel combustion between 2012 and 2022 (IEA, 2024[15]).

3.2. Country cases: Financial authorities’ role in monitoring GHG emission targets

Although some financial authorities may not be explicitly mandated to track net-zero commitments, they may monitor financial institutions’ performance against their net-zero commitments for at least three reasons. First, they may recognise that financial institutions that align their activities and investments with global climate goals may better manage their transition risks since their portfolios will be steered to investee companies with smaller carbon footprints. Second, financial authorities may understand that financial institutions have a role in incentivising non-financial companies to phase out high-emitting activities and invest further in low-carbon technologies, reducing climate change risks for the financial markets and the economy more broadly. Third, specifically in the case of financial institutions that pledge to be in line with global climate goals, financial authorities may decide to monitor the truthfulness of such a pledge to protect the interests of the clients for whom environmental matters are important when choosing the services of a financial institution. The following analysis benefited from the contributions of volunteer jurisdictions.

3.2.1. European Union

National central banks in the European Union are part of the European banking supervision system under the Single Supervisory Mechanism (SSM), which includes the European Central Bank (ECB) and the national supervisory authorities of member countries. The ECB focuses on the Significant Institutions (SIs) by regularly assessing their financial situation, verifying their compliance with prudential requirements, taking any necessary supervisory measures, and performing stress tests. Less Significant Institutions (LSIs) are supervised directly by the national central banks, which provide harmonised supervision guided by the general policies and instructions issued by the ECB. In 2022, SIs of the member countries participated in the ECB Thematic Review on institutions’ climate-related and environmental risk strategies, as well as their governance and risk management frameworks and processes. The ECB Thematic Review was conducted by the ECB and 21 national competent authorities and covered 186 banks. In 2023, the ECB reviewed practices and trends of climate-related and environmental risk disclosure of 103 SIs and 28 LSIs in the Eurozone. The assessment covered the existence, substantiation and soundness of disclosures across key areas of the supervision expectations, including materiality assessment, business model and strategy, governance, risk management, and metrics and targets. The information typically considered in the assessment included: annual reports, non-financial reports, sustainability reports and EBA Pillar 3 reports. For consistency with other supervisory exercises performed in 2022, the ECB also considered the documents submitted by the institutions in the context of its 2022 ECB Thematic Review on climate-related and environmental risks and the 2022 climate risk stress test.

Since 2025, the ECB’s remit includes the supervision of transition plans developed by European banks in the context of the implementation of the Basel reforms. Under the new prudential framework, European banks will be required to submit their transition plans, which will include specific objectives and targets for the transition to a sustainable economy.

In parallel, European banks and financial intermediaries are subject to disclosing ESG information in the EBA Pillar 3 templates, as well as under the TCFD principles and recommendations. In 2023, large institutions with listed securities published the first set of annual disclosures on ESG risks under EBA’s Pillar 3 disclosure requirements. Notably, the European Banking Authority (EBA) requires banks to disclose exposures to carbon-intensive activities and assets that may experience physical risk as a result of climate change, financed emissions data and alignment of metrics with 2050 net-zero goals.

In the scope of the European Commission’s Renewed Sustainable Finance Strategy, the EBA conducts the one-off Fit-for-55 climate risk scenario analysis in collaboration with the other European Supervisory Authorities (ESAs), the ECB and the European Systemic Risk Board (ESRB). The exercise aims at assessing the resilience of the financial sector in line with the Fit-for-55 package, and to gain insights into the capacity of the financial system to support the transition to a lower carbon economy under conditions of stress. In November 2025, the EBA published the Guidelines on environmental scenario analysis on the management of ESG risks. The Guidelines aim to support institutions in developing their internal capabilities and skills necessary for setting and using scenarios, primarily to test the shock-absorbing capacity of their capital and liquidity reserves as well as the resilience of their business model over the medium to long-term (European Banking Authority, 2025[16]).

At the funds level, the European Insurance and Occupational Pensions Authority (EIOPA) published an opinion on sustainability claims alongside its final report on greenwashing in April 2024. The opinion, setting out a series of principles applicable at product- and entity-level, requires providers to substantiate claims related to longer-term sustainability objectives, such as transition plans or commitments, with detailed plans, interim targets and regular reporting on the implementation status of their plans. The EIOPA plans to monitor supervisory actions taken by competent authorities starting in 2026.

The European Securities and Markets Authority (ESMA) published a similar report in June 2024. The report examines the current supervisory framework for monitoring greenwashing risks and sets out an agenda for ESMA and national competent authorities to follow going forward. Specifically, ESMA committed to fostering supervisory convergence by introducing common strategic supervisory priorities and actions focusing on sustainability-related disclosures. Further, ESMA plans to develop indicators to monitor greenwashing risk, support the deployment of supervisory tools, and provide additional guidance in high-risk greenwashing areas.

Box 3.2. The ECB review on climate-related and environmental risks

2022 ECB Thematic Review on climate-related and environmental risks

The results of the review show that some leading institutions have started to use transition planning tools, along with targeted client engagement to enhance the resilience of their business model over longer time horizons. Such intermediaries usually use scientific pathways to assess their portfolio’s alignment with the Paris Climate Agreement and set concrete intermediate targets showing how portfolios have to evolve over time to meet longer-term objectives, such as reaching net-zero emissions by 2050. Transition planning policies, processes and actions are integrated into these institutions’ organisational framework.

However, a wait-and-see approach in strategy-setting is still prevalent in most institutions. In particular, long-term strategic commitments are not supported by intermediate targets, limits and thresholds, or these are set such that there is negligible immediate impact on the institution’s exposure profile. Moreover, it is still rare for institutions to test their strategies against various pathways.

The majority of institutions have also started to determine the impact of climate-related risks on their business strategy and established an initial set of key performance indicators (KPIs) for their strategic response. However, in most cases this is an initial approach at an early stage of development. An example of such an initial approach could be that an institution has communicated its goal to achieve net-zero GHG emissions, including from its financing activities by 2050 or earlier, and even set intermediate objectives. Often KPIs are not formulated in a way that allows for effective implementation and monitoring of progress.

Several leading institutions employ forward-looking tools to determine the impact of climate-related risks on their business strategy and use the results as a basis for concrete strategic actions. Some institutions use scientific pathways in their strategy-setting process to set concrete intermediate targets, typically using portfolio alignment methodologies, to pursue longer-term strategic objectives. The more advanced institutions demonstrate awareness of the need to use up-to-date scientific pathways to set targets that are sufficiently ambitious. These targets show how the institution’s portfolios have to evolve over time in order to meet the longer-term objectives. In addition, these institutions have adjusted their product offering to achieve their targets and established policies and procedures to follow up on misalignments in their portfolios.

2023 ECB review of climate-related and environmental risks disclosure practices and trends

The disclosure review is based on a supervisory assessment of institutions’ publicly available disclosures end 2021 as a reference date, or a later date where available. According to the supervision expectations, institutions are expected to disclose the KPIs and key risk indicators (KRIs) used for the purposes of their strategy-setting and risk management, as well as their current performance against these metrics. Alignment metrics can be an important tool for banks to measure their progress towards the Paris Climate Agreement objectives applied to their portfolio.

Financed emissions are one of the key elements in approaches to climate risk identification, measurement and management. There are still heterogeneities around the disclosed data and supporting information, such as the non-disclosure of scope 3 financed emissions, disclosure for parts of portfolios only, and the lack of clarity regarding banks’ measurement approaches.

For effective target-setting, material portfolios need to be identified. Credit portfolios in key risk sectors can be identified using the NACE sector classification. However, only a few institutions provided a breakdown of all exposures by NACE code. Around one-third of the institutions in scope have carried out a Paris Agreement Capital Transition Assessment (PACTA) analysis. PACTA methodology allows banks to take a forward-looking approach to assessing portfolios in key risk sectors for alignment using different scenarios. However, the observed outcomes of the analyses were often not in-depth.

In general, the International Energy Agency (IEA) scenarios predominated for target-setting. Several institutions have not only published a description and the sector coverage for each scenario but also provided further granularity down to the regional level. For example, the IEA Sustainable Development Scenarios (SDS) benchmarks for the EU are much more restrictive in specific areas (e.g. power, oil and gas, automotive and coal) than those for non-EU OECD member countries or global scenarios. However, most banks use global benchmarks for their alignment analysis. Institutions publish their targets and respective alignments for each sector. These include both the trajectories for the invested portfolio and the targets under the selected scenarios.

In practice and on a portfolio level, target-setting initiatives and portfolio alignment approaches of banks do not describe how portfolio emission reductions are achieved. For example, where a portfolio has become more climate-aligned between two dates, no explanation of what drove that specific improvement is given (e.g. whether the portfolio emissions were reduced through portfolio reallocation or disinvestment, or whether the underlying counterparty managed to decarbonise its processes or production).

Source: European Central Bank, (2022[17]), Walking the talk. Banks gearing up to manage risks from climate change and environmental degradation, https://www.bankingsupervision.europa.eu/ecb/pub/pdf/ssm.thematicreviewcerreport112022~2eb322a79c.en.pdf; Bank of Italy, (2023[18]), Action plans for the integration of climate-related and environmental risks into non-bank intermediaries’ business processes: main findings and good practices, https://www.bancaditalia.it/focus/sostenibilita/vigilanza-sostenibilita/01_Piani_di_azione_LSI_EN.pdf. European Central Bank, (2023[19]), The importance of being transparent. A review of climate-related and environmental risks disclosures practices and trends, https://www.bankingsupervision.europa.eu/ecb/pub/pdf/ssm.theimportanceofbeingtransparent042023~1f0f816b85.en.pdf

3.2.2. Greece

For LSIs directly supervised by the Bank of Greece, initiatives are implemented in line with actions taken at the EU level. The Central Bank has undertaken specific actions to test the level of awareness of Greek banks about the strategic relevance of climate-related and environmental risks for the sustainability of their business models. Notably, all LSIs have submitted action plans outlining concrete actions and timelines for conducting their own materiality assessments. These plans consider climate-related and environmental risks in relation to their operating environment, business model, risk profile, and governance structures, regardless of the institution's size. A proportionate and gradual approach is being followed, considering the complexity of banks’ business model and their significance from a financial stability perspective.

3.2.3. Ireland

The Central Bank of Ireland does not currently formally track institutions' performance against their net-zero commitments. However, several supervisory mechanisms are ongoing to ensure financial institutions are meeting supervisory expectations in managing climate-related risks.

Data challenges arise when approaching retail banks' performance against net-zero commitments. Banks often lack reliable data on their current GHG emissions as their carbon footprint is largely driven by the loan portfolio. This is primarily because many of their counterparties do not report GHG emissions data. The Central Bank of Ireland has developed analytics which currently, or will in the future, enable supervisors to better assess the general alignment or trajectory of banks’ loan portfolios with their GHG emissions-related commitments. These analytics include assessing banks’ loan book profiles and tracking changes over time, focusing on the climate policy relevant Climate Policy Relevant Sectors (CPRS) and lending to the top 25 global emitters; developing proxies for banks’ emission profile and intensity, for example using Eurostat emissions and emissions intensity data for the sectors and countries of the bank’s loan counterparties or by using information on publicly quoted loan counterparties GHG emissions from third-party information providers.

Performance against net-zero commitments is not tracked for the insurance sector, mainly due to the nascent status of net-zero commitments and the lack of data.

Concerning investment funds’ supervision, the Central Bank of Ireland monitors GHG emissions in many ways, from underlying portfolio level upward, within Irish-authorised investment funds and firms. These metrics are calculated quarterly, allowing for historical oversight of trends and developments within investment firms and products. Some examples include the assessment of absolute emissions and the measurement of emission intensity, both per revenue and energy use. Additionally, the Central Bank has implemented an assessment of implied temperature impact via the TCFD guidelines for the evaluation of companies’ path to net zero. Additionally, data on the presence and types of reduction targets deployed by companies are collected and stored.

Similarly, the Central Bank maintains detailed data on portfolio activities regarding regulatory alignment, such as the ability to assess all criteria for the Paris Aligned Benchmark (PAB) and Climate Transition Benchmark (CTB) EU Regulations. These processes are in place for all investment products, totalling around EUR 4.5 trillion in net asset value across 6 800 products.

With the introduction of the EU Corporate Sustainability Reporting Directive (CSRD), the level of data on net-zero commitments and associated plans will improve significantly. Although the Irish Auditing and Accounting Supervisory Authority (IAASA) is the supervisory authority for the CSRD, the Central Bank of Ireland will be informed of its supervisory work.

3.2.4. Italy

The Bank of Italy does not directly monitor financial institutions’ performance regarding their net-zero commitments or their progress toward these targets.

With reference to the institutions falling under the competence of the national supervisory authorities, in early 2022, the Bank of Italy identified an initial set of supervisory expectations for the integration of climate-related and environmental risks into the corporate strategies, governance and control systems, risk management frameworks and disclosure requirements of supervised banking and financial intermediaries. The Bank of Italy participated in the ECB’s Thematic Review of significant banks with a sample of 21 LSIs and carried out a domestic thematic review on a sample of non-bank intermediaries. The survey answers were made available to the LSIs and non-bank intermediaries, urging the governing bodies of these financial institutions to adopt action plans. The main results of the analysis of the action plans prepared by LSIs and non-bank intermediaries were published, together with an update of the good practices observed.

Moreover, the Bank of Italy carried out an analysis of Pillar 3 ESG disclosures provided by significant Italian banks and a sample of 11 significant European banks, and an analysis of the information provided in the sustainability-related disclosure of 30 Italian banks that were required to provide KPIs under the EU Taxonomy. According to the Bank of Italy’s discussions with the banking industry, the availability and quality of sustainability data for borrowers or investees is one of the most critical topics for banks, especially with regard to information on the exposure to climate-related risks of small and medium-sized enterprises.

3.2.5. United Kingdom

The United Kingdom has no immediate plans to track financial institutions’ performance against their net-zero commitments. The United Kingdom has focused on improving the standard of transition plan disclosures in both the financial and real economy sectors, including by supporting the Transition Plan Taskforce (TPT).

The TPT’s disclosure framework sets out the key metrics and performance indicators that firms can disclose to track for themselves and allow others to track their performance against net-zero and transition commitments. This will enable firms to be held accountable by their shareholders, customers, and civil society for meeting their sustainability commitments.

The UK Financial Conduct Authority (FCA) has set out that it expects to consult on its approach to the ISSB standards and, as part of this process, intends to develop guidance for its expectations on transition plans that reference the TPT Disclosure Framework. The Bank of England expects to primarily be a user of information from transition plans-related disclosures to inform its work and support its objectives of economic and financial stability. Separately, the UK government is considering whether it could track and report low-carbon investment at a national and sectoral level over time. Such estimates could be compared with UK national net-zero targets. However, any tracking-exercise would not be undertaken at a firm-level.

3.3. Revenues, portfolio and underwriting activities

Assessing a financial institution’s portfolio composition and revenues enables investors and other relevant stakeholders to track changes in the institution’s investment or lending approach. Decarbonisation goals can be achieved by reducing investments in carbon-intensive assets and redirecting financial resources from these assets towards green businesses.

The share of green revenues provides an indication of where a company stands in relation to its green transition. At the same time, the portfolio analysis may provide insights into the company’s direction. By assessing the portfolio composition, investors can gauge financial institutions’ investment or lending approach to reduce their GHG emission footprint and intensity. The issuance of sustainable market instruments can reflect the operational changes that a financial institution is making to align its business with net-zero commitments.

3.3.1. Green revenues

Globally, in 2024, only 0.7% of listed financial institutions disclosed a positive green revenue share, calculated as green revenues over total revenues. Regional distribution ranges from 0.4% in Emerging and Developing Asia excl. China to 2% in Developed Asia-Pacific excl. US. When disclosed, green revenues account for an average of 12% of total revenues. (Figure 3.6).

Figure 3.6. Portfolio contribution to green and climate solutions: green revenues, 2024

Note: This figure is based on available information from 4 922 listed financial institutions. The analysis includes information from 1 770 listed financial institutions disclosing the green revenues as a percentage of the total revenues, 33 of which report a share greater than zero. The average green revenues are calculated as the mean percentage of green revenues relative to total revenues across the 33 financial institutions that disclosed positive green revenues, displayed by region. The figure displays only jurisdictions with at least 5 financial institutions disclosing green revenues. In the figure, China, Latin America, the Middle East and Africa and the United States are excluded from the analysis due to a lack of data.

Source: OECD Corporate Sustainability dataset, Bloomberg, LSEG. See Annex A for details.

3.3.2. Sustainable bonds

Sustainable bonds provide a key financing source for financial institutions seeking to meet their sustainability objectives. Sustainable bonds fall into two main categories: “Use of Proceeds Bonds” and “Sustainability‑Linked Bonds” (SLBs). SLBs have variable financing costs based on the issuer meeting specific sustainability targets, but the proceeds do not have to be allocated to sustainable projects. Meanwhile, for “Use of Proceeds Bonds,” the proceeds are earmarked for financing or refinancing eligible green, social, or sustainable projects. This category specifically includes green, social and sustainability bonds (GSS bonds). Green bonds fund environmentally beneficial projects, including specific categories such as “blue bonds” or “climate bonds”. Social bonds target projects addressing social issues, while sustainability bonds finance a mix of both green and social projects (OECD, 2025[20]).

Over the past five years, sustainable bonds issued by the financial sector have experienced notable growth as a source of capital market financing, representing nearly half (47%) of the global issuance amount in corporate sustainable bonds over 2020-24. In 2024, the outstanding amount of sustainable bonds issued by the financial sector totalled USD 1 121 billion. The outstanding amount of sustainable bonds issued by the banking sector accounted for USD 765 billion, representing 68% of the outstanding amount of the sustainable bonds issued by financial institutions. Conversely, non-banking companies’ outstanding amount of sustainable bonds totalled USD 356 billion, which is 32% of the outstanding amount of all corporate sustainable bonds issued by financial institutions (Figure 3.7).

Figure 3.7. Global sustainable bond issuance and outstanding amount

Source: OECD Corporate Sustainability dataset, Bloomberg, LSEG. See Annex A for details.

Europe has been the most active region in the issuance of sustainable bonds market by the financial sector. From 2015 to 2024, 54% of the global amount issued by financial institutions through sustainable bonds was raised by European companies, followed by Developed Asia-Pacific excl. US (16%), China (14%), and the United States (10%).

3.3.3. Sustainable loans

Sustainable loans are an alternative source of financing that can be used to pursue sustainable goals. Similarly to sustainable bonds, sustainable loans can be classified into two main categories: loans aimed at financing projects with a positive environmental and/or social impact (green, social and sustainable loans); and the loans that link the loan contract terms to the borrower’s sustainability performance (sustainability-linked loans). In this section, only syndicated loans are analysed because information is more widely available in cases where more than one financial institution lends to the same borrower(s).

Since 2015, sustainable lending has grown significantly, with a total sustainable syndicated issuance of USD 621 billion in 2024, over 13 times higher than in 2015 (Figure 3.8). Sustainability-linked loans have dominated the issuances since 2019. In 2023, after a sharp increase in issuance in 2021 and 2022, sustainable lending showed a slight decrease. In 2024, USD 104 billion were allocated through green loans, USD 472 billion through sustainability-linked loans and USD 45 billion through other sustainable syndicated loans.

Figure 3.8.  Sustainable syndicated loans and sustainable-linked syndicated loans: issuances 2015-2024

Source: OECD Corporate Sustainability dataset, LSEG.

The financial and utilities sector received the largest proportion of sustainable loans in 2024, with USD 123 billion and USD 108 billion corresponding to 11% and 31% of each industry’s total syndicated loans, respectively (Figure 3.9). The financial industry collected 35% of the total green loans and 18% of the total sustainability-linked loans issued in 2024. One-third of green loans were allocated to the utilities industry, reaching almost USD 34 billion in 2024. Sustainable syndicated loans, other than green and sustainability-linked loans, primarily directed their proceeds to utilities (USD 29.7 billion), energy (USD 5.8 billion) and industrials (USD 3.9 billion).

Sustainability-linked syndicated loans accounted for the most used categories among sustainable syndicated loans in all industries, collecting USD 471 billion. In 2024, USD 104 billion were raised through green syndicated loans and USD 45 billion through other sustainable loans.

Figure 3.9.  Sustainable loans and sustainable-linked loans: issuances in 2024, industry distribution

Source: OECD Corporate Sustainability dataset, LSEG.