Sustainable finance in 2025: These are the key sectors redefining global markets

In 2025, sustainability has been overshadowed by geopolitics and election cycles dominating headlines. However, momentum around sustainable finance has not stalled.

Sustainable debt issuance topped $1 trillion in 2024 for the fifth consecutive year and private finance for nature has grown over elevenfold since 2020. This continued flow of capital reflects more than good intentions; rather, risks are becoming sharper.

Extreme weather, food insecurity and nature loss are actively reshaping economies and portfolios, making resilience a financial imperative, not a choice.

This year is about recalibrating for impact. Capital is entering food systems, nature, industry and infrastructure – embedding sustainability deeper into investment and corporate finance.

With available solutions, strengthening demand signals and increasingly measurable opportunities, the challenge now is execution. Leaders in banking, investment and policy have a narrow window to expediently scale solutions. Those who stay the course will protect portfolios and capture the first-mover advantage in the markets of tomorrow.

Investors are moving beyond broad pledges and channelling capital into real-economy sectors – food systems are rising to the top.

Food underpins the global economy, accounting for 10% of gross domestic product and 40% of jobs. Yet, it is also highly vulnerable: droughts, floods and supply chain disruptions are driving inflation and destabilizing markets.

Transformation is necessary but it is also a major opportunity, as regenerative agriculture, resilient livestock practices and deforestation-free supply chains open new markets, diversify revenue streams and strengthen portfolios.

Momentum is already visible. Climate finance for agrifood systems rose over 300% since 2019, reaching $95 billion annually, according to the Climate Policy Initiative, while blended-finance vehicles are mobilizing billions annually across emerging markets.

A growing body of case studies demonstrates how capital is already being unlocked.

From Intesa Sanpaolo’s €23 billion programme extending reduced-rate loans to 172 agri-food supply chains in Italy, to GrowBeyond’s $100 million blended vehicle supporting smallholder farmers across the Association of Southeast Asian Nation states, and Aceli Africa’s $300 million mobilized across 3,500 loans to reach 1.5 million farmers and workers.

Despite the progress, agri-food systems require $1.1 trillion annually over the next five years, yet less than 5% of that is being met today. Closing this gap is critical but the trajectory is clear.

The world’s largest asset managers now recognize “nature capital” – biodiversity, water and soil – as fundamental to long-term performance.

The World Economic Forum estimates this opportunity to be $10 trillion in annual business value and nearly 400 million jobs by 2030 through nature-positive transitions.

Realizing this requires up to $2.7 trillion annually but capital flows are accelerating with private finance for nature growing from $9.4 billion in 2020 to more than $100 billion by 2024.

With nature underpinning the global economy, investors are starting to integrate it into portfolio assessments, closing the long-standing “data gap,” while pipelines of investable opportunities are expanding across sectors – from agri-food and chemicals to mining and water – supported by emerging financing models, policy frameworks and risk-sharing mechanisms.

Regulation is also advancing: the European Union’s (EU) Corporate Sustainability Reporting Directive, the European Banking Authority’s Environmental, Social and Governance guidance and the Taskforce on Nature-related Financial Disclosures are tightening expectations for nature-related risk reporting.

Nature finance is no longer emerging; those who act early will capture returns while helping set market-defining rules.

Net zero is impossible without tackling heavy industry and transport. Steel, cement, aluminium, aviation, shipping and chemicals produce over one-third of global carbon dioxide emissions. These sectors are among the hardest to decarbonize, still tied to fossil feedstocks and energy-intensive processes.

Yet progress is lagging: only $250 billion has been mobilized against a $1.6 trillion need for low-carbon materials. Clean technologies such as green hydrogen, sustainable aviation fuel and green ammonia exist but scaling is constrained by high upfront costs, fragmented demand and thin pipelines, especially in emerging economies.

The stakes are clear: delay risks stranded assets, disrupted supply chains, and lost growth.

Momentum is building. Sweden’s HYBRIT has delivered fossil-free steel to Volvo, Maersk is sailing methanol-fueled ships and Cemex is rolling out low-carbon cement across Latin America.

Governments are also shaping markets: the European Union’s Carbon Border Adjustment Mechanism is rewriting trade rules, Japan’s GX Promotion Act is directing subsidies and India, Brazil and Australia are betting on hydrogen hubs and green iron.

Finance is catching up too, with blended-capital vehicles, aviation fuel price floors and de-risking models for shipping and industrial clusters underway. Together, these moves show how demand signals, enabling policy and innovative finance are converging to shift from pilots to full-scale industrial transformation.

The next bottleneck in the transition is not renewable capacity but the infrastructure that connects and stabilizes it. Modern grids, long-duration storage, resilient ports and digital platforms are the underfunded backbone of the energy transition, requiring $600 billion annually by 2030.

Already, grid congestion in Europe is delaying renewables, while power shortages in the Global South constrain growth and deployment. For investors, these assets combine stable, inflation-protected returns with systemic impact, making infrastructure a portfolio stabilizer and a growth opportunity.

Upgraded grids reduce losses and unlock stranded clean power. Meanwhile, storage smooths volatility and digital platforms optimize utilization, shielding portfolios from disruption. In short, infrastructure is where resilience meets return.

Achieving the UN Sustainable Development Goals by 2030 will require an additional $4 trillion annually, well beyond public budgets. At the once-a-decade International Conference on Financing for Development in Sevilla, leaders reaffirmed their commitment, backing a tripling of multilateral development banks’ lending capacity and greater use of blended finance to mobilize private capital.

For investors, this means expanding opportunities in emerging and developing economies, with development banks and finance institutions absorbing early risks. Development finance is shifting from aid to a platform for scalable, investable growth aligned with climate and sustainability goals.

The next era of finance will be defined less by headlines than by discipline. Across food, nature, industry and infrastructure, investable opportunities are emerging and capital is already flowing. The test is which institutions have the conviction to stay the course.

For financial leaders, this is about shaping markets as much as preserving them. Those that embed sustainability as a core practice, stay steady through political cycles and build the skills, data and partnerships to turn ambition into execution will secure long-term advantage.

The future will be built not on pledges but persistence. Leaders who act with patience and purpose will deliver resilient returns and help shape a financial system that is inclusive, stable and nature-positive.