The global issuance of sustainable bonds is expected to stabilise this year, at between $800 billion and $900 billion, according to S&P Global Ratings.
S&P Global Ratings has announced a series of sustainable bond outlooks for 2026, noting that the issuance of sustainable bonds is set to consolidate, as regional trends diverge and the market matures.
“The era of rapid expansion is giving way to a period of measured growth,” commented Patrice Cochelin, managing director, sustainability methodology and research, S&P Global Ratings. “Issuers contend with rising debt maturities, shifting policy priorities, and a more competitive capital market.”
‘A key financing tool’
Sustainable bonds, which include green, social, sustainability and sustainability-linked instruments, will continue to experience ‘substantial’ issuance levels, S&P noted, as they ‘remain a key financing tool for climate and social projects worldwide’.
In Europe, issuance is expected to stabilise, maintaining the region’s position as the world’s largest sustainable bond market.
‘Strong regulatory frameworks and investor demand, combined with evolving policy standards, will help reinforce Europe’s leadership position, while providing clearer guidance for issuers and investors,’ S&P noted.
In the US, while sustainable financing for clean transportation, water infrastructure, and climate resilience initiatives is ongoing, some issuers are opting for conventional bonds to reduce reporting obligations, it added.
Asia Pacific is expected to see renewed activity as many sustainable bonds are approaching maturity, creating refinancing opportunities and prompting issuers to ‘return to the market with updated sustainability frameworks or new climate-related projects’.
Elsewhere, Latin America is projected to experience ‘modest growth’ in sustainable bond issuance, reflecting increased funding needs for renewable energy, climate adaptation, and social initiatives.
‘Strong demand for sustainable debt from governments, corporations, and investors is fuelling market activity [in Latin America], and the region is emerging as a hub for innovative sustainable debt instruments,’ S&P noted.
Finally, in the Middle East, sustainable bond issuance is expected to remain ‘resilient’, with governments integrating sustainability objectives into their broader economic diversification strategies, including large-scale investments in renewable energy, hydrogen, and sustainable infrastructure. Read more here.
