IOV: from commitment to implementation

Despite ongoing uncertainty across markets, driven by geopolitical shifts, inflationary pressures and climate-related disruptions, the institutional investors we speak to at ANZ say they remain firmly committed to sustainability. And our sense is that commitment is ready to turn into action.

In our view, we expect to see a decisive shift in the environmental, social and governance landscape in 2026, from commitment to implementation, as an increasing number of businesses begin to really act on their own journeys to a low-carbon economy.

This in turn is likely to present growth opportunities and an increased focus on risk management for all businesses.

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Climate action, net-zero pathways, and impact investing will all continue to grow in importance as strategic priorities for investors and corporates, particularly in Europe and Asia.

Green bonds are expected to continue to grow in 2026 due to the critical investment required for a wide range of sectors, particularly infrastructure and energy. Cumulative lifetime issuance of green, social, sustainable and sustainability-linked debt instruments had reached close $US12 trillion by the end of September, according to Bloomberg NEF data.

In the conversations we’re having, it’s clear tangible plans for transition finance are being put in place right across the Australian business landscape, and we expect that to continue in the medium term. Companies are continuing to look to decarbonise assets and take advantage of innovative climate solutions.

We expect sustainable finance for adaptation and resilience investment to continue to gain traction. And nature will continue to grow in importance in sustainable finance consideration, as investors recognise biodiversity loss as a systemic financial risk. Climate can no longer be seen in isolation.

Bronwyn Corbet is Exec Director, Sustainable Finance at ANZ Institutional