(Editor's Note: The dataset for this study includes outstanding sustainable bonds rated by S&P Global Ratings and issued by financial and nonfinancial corporate entities--as well as international public finance, sovereign, and supranational entities--that have a public identifier such as an ISIN or a CUSIP. U.S. public finance bonds, agency-backed mortgage bonds [notably from Fannie Mae], and structured finance bonds have been excluded from our dataset.)
This report does not constitute a rating action.
Key Takeaways
- The sustainable debt market has sufficient liquidity, in our view, to meet near-term refinancing needs, even if issuance slows down in 2025. Rated issuance in each of the past five years was close to double the amounts scheduled to mature annually over the next five years.
- Sustainable bond maturities currently peak in 2026, at $389 billion, with medium-term debt issued in and around 2019 coming due along with recently issued shorter-term debt.
- Green bonds saw record issuance in 2024 and now represent 55% of the sustainable debt maturing through 2029. Their dominance in this market will persist.
S&P Global Ratings rates over $3.5 trillion in outstanding sustainable bonds (as of January 2025), and $1.8 trillion of that amount is scheduled to mature over the next five years (through 2029). The sustainable bond market has grown at a fast pace since 2019, and rated issuance last year was solid, at $638 billion.
The amount outstanding is likely to continue increasing for the foreseeable future, even if issuance slows down in 2025. While this year started out strong for the overall debt market (including conventional bonds), recent market turmoil and heightened uncertainty pose a risk to debt market conditions.
We believe the volume of sustainable debt with upcoming maturities is manageable, given recent issuance levels. As an increasing amount of rated sustainable debt has been reaching maturity, we expect that refinancing will add to the supply of sustainable debt. But investor demand appears to be more than sufficient to meet these needs: Rated issuance in each of the past five years was close to double the amounts scheduled to mature annually over the next five years.
About $319 billion of sustainable debt is set to mature in 2025 (as of Jan. 1, 2025), and annual maturities peak in 2026, at $389 billion--with debt issued in 2024 accounting for 7% of that amount. The peak year for maturities hasn't changed since April 2024--and 2026 maturities have increased since then. The issuance of shorter-dated debt in 2024 has contributed to higher annual near-term maturities.
Trends By Type Of Debt
Green bonds over the past year expanded their already dominant share of the sustainable bond market, and we think that dominance will persist. They represent 57% of outstanding sustainable debt--up four percentage points from April 2024, following last year's record issuance. And they represent 55% of the sustainable debt maturing through 2029, followed by sustainability bonds at 20% and social bonds at 19%.
S&P Global Ratings expects green bonds to continue to dominate sustainable debt issuance because of efforts to close the climate finance gap in lower-income countries (see Sustainability Insights: Global Sustainable Bond Issuance To Hold Steady At $1 Trillion In 2025, Feb. 5, 2025). Approximately two-thirds of the sustainable debt issued in 2024 by financial and nonfinancial corporate, public finance, sovereign, and supranational entities is rated by S&P Global Ratings.
Trends By Rating
Rated sustainable debt is overwhelmingly investment grade, which should decrease refinancing risks. Only 6% of the rated sustainable debt outstanding was speculative grade as of January 2025. Debt rated 'A-' or above accounted for 71%, and it accounted for an even higher share (77%) of the debt maturing this year and next.
Roughly one-third of speculative-grade sustainable debt was issued in 2021, and it primarily consists of sustainability-linked and green bonds issued by nonfinancial corporate entities.
Slightly more than half of the speculative-grade sustainable debt outstanding was issued between 2022 and 2024. Nonfinancial corporate entities account for most of that amount, but sovereigns--notably, in Latin America and in emerging markets in EMEA (Europe, the Middle East, and Africa)--also started to account for a meaningful share. Their portion of this debt supports efforts to close the climate finance gap in lower-income countries.
While the ratings are predominantly investment grade, the rating distributions vary sharply across the different types of bonds. Social bonds have the highest concentration of debt rated 'A-' or higher, at 91% of the outstanding debt--and 97% is investment grade. International public finance entities dominate social bond issuance, and they tend to be more highly rated.
In contrast, sustainability-linked bonds have the highest share of outstanding speculative-grade debt (28%), and investment-grade sustainability-linked bonds are predominantly in the 'BBB' rating category--the low end of investment grade. This reflects the high representation of nonfinancial corporate issuers--notably, European utilities--in the sustainability-linked pool (90% of the outstanding debt).
Trends By Issuer Region And Type
Much of the rated sustainable debt that's outstanding--48%--comes from European entities. However, this figure would be higher if it included issuance by the European Union (the rated entity); that issuance is considered supranational debt. Supranational entities are the second-largest regional category we track, accounting for 19% of the rated sustainable debt outstanding--much of it from development banks.
International public finance entities, including supranational entities, issued 37% of the sustainable debt maturing over the next five years, down two percentage points from April 2024 (see Green, Social, And Sustainable Debt Maturities Approach $1.2 Trillion Through 2028, July 17, 2024). The share of nonfinancial corporate debt increased over the same period.
Of the debt maturing through 2029, Europe accounts for 45%, up four percentage points from April 2024. The share of maturities from Asia-Pacific--the second-largest region--fell three percentage points over the same period, to 22%. The increase in share for Europe reflects its prominence last year in rated sustainable bond issuance--it accounted for 45% (excluding issuance by supranational entities from the region).
Trends By Maturity
About 20% of outstanding sustainable debt is set to mature in 2025 or 2026. This is a jump from the 7% that was to mature in the 24-month period that began April 2024.
One cause for the jump is the market's rapid growth since 2019. Second, while issuance has slowed over the past year, tenors have also shortened. This year and next will see medium-term sustainable debt issued in or around 2019 come due, along with shorter-term debt issued more recently.
About 3% (or roughly $10 billion) of the 2025 maturities was issued in 2024. Social bonds from Korean financial institutions represent more than 60% of that amount, while green bonds issued by Austria, the sovereign, make up close to a third.
About 14% of the sustainable debt maturing in 2026 and 2027 was issued in 2024. That portion of the debt has a higher concentration of bonds issued by financial services and international public finance entities, excluding supranationals. While their sustainable bonds tend to have shorter maturities than sustainable bonds more broadly, and while the concentration of bonds issued in 2024 with shorter tenors has shortened the median maturity of the total sustainable debt outstanding, tenors also vary by the type of bond.
| Annual maturities of rated sustainable debt | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (Bil. $) | 2025 | 2026 | 2027 | 2028 | 2029 | |||||||
| Green bonds | 172.2 | 218.3 | 219.5 | 187.3 | 191.5 | |||||||
| Investment grade | 163.6 | 206.4 | 206.5 | 174.1 | 177.1 | |||||||
| Speculative grade | 8.6 | 11.9 | 13.0 | 13.2 | 14.4 | |||||||
| Social bonds | 71.8 | 77.4 | 63.1 | 63.4 | 58.0 | |||||||
| Investment grade | 71.1 | 76.8 | 60.5 | 61.7 | 56.6 | |||||||
| Speculative grade | 0.7 | 0.6 | 2.6 | 1.7 | 1.4 | |||||||
| Sustainability bonds | 68.7 | 74.1 | 72.3 | 81.8 | 70.7 | |||||||
| Investment grade | 68.2 | 70.3 | 70.7 | 81.2 | 67.2 | |||||||
| Speculative grade | 0.4 | 3.9 | 1.6 | 0.5 | 3.5 | |||||||
| Sustainability-linked bonds | 6.0 | 19.2 | 18.7 | 33.4 | 29.2 | |||||||
| Investment grade | 5.4 | 11.4 | 11.4 | 22.2 | 14.8 | |||||||
| Speculative grade | 0.5 | 7.8 | 7.3 | 11.3 | 14.4 | |||||||
| Transition bonds | 0.6 | 0.3 | 0.7 | 1.7 | 2.2 | |||||||
| Investment grade | 0.6 | 0.3 | 0.7 | 1.7 | 1.0 | |||||||
| Speculative grade | 0.0 | 0.0 | 0.0 | 0.0 | 1.3 | |||||||
| Total | 319.2 | 389.3 | 374.2 | 367.6 | 351.7 | |||||||
| Data as of Jan. 1, 2025. Includes only bonds rated by S&P Global Ratings. Sources: Environmental Finance, S&P Global Market Intelligence, and S&P Global Ratings Credit Research & Insights. | ||||||||||||
Sustainable Bonds Defined
Sustainable bonds fall into two main categories:
- Sustainability-linked bonds: Any instrument for which the financial or structural characteristics can vary depending on whether the issuer achieves predefined sustainability objectives.
- Use-of-proceeds bonds: Any instrument where the net proceeds (or an equivalent amount) are exclusively used to finance or refinance, in part or in full, new or existing eligible green or social projects.
The three main subcategories of use-of-proceeds bonds are:
- Green bonds: Instruments that raise funds for projects with environmental benefits, including renewable energy, green buildings, and sustainable agriculture. They also include blue bonds, which raise funds to support the sustainable use of maritime resources and promote related sustainable economic activities.
- Social bonds: Instruments that raise funds for projects addressing a specific social issue or seeking positive social outcomes, such as improving food security and access to education, health care, and financing--especially (but not exclusively) for target populations.
- Sustainability bonds: Instruments that raise funds for projects with both environmental and social benefits.
Transition bonds can be either sustainability-linked or use-of-proceeds bonds issued specifically to support climate transition goals, geared toward issuers in hard-to-abate sectors (those with a high dependence on fossil fuels and no simple solutions for reducing emissions). Projects these bonds support may not always be "green," but they still aim to support climate transition.
Source: S&P Global Ratings (Sustainability Insights: Global Sustainable Bond Issuance To Hold Steady At $1 Trillion In 2025, Feb. 5, 2025).
| Primary Contact: | Sarah Limbach, Paris 33-14-420-6708; Sarah.Limbach@spglobal.com |
| Secondary Contacts: | Evan M Gunter, Montgomery 1-212-438-6412; evan.gunter@spglobal.com |
| Patrick Drury Byrne, Dublin 00353-1-568-0605; patrick.drurybyrne@spglobal.com | |
| Patrice Cochelin, Paris 33144207325; patrice.cochelin@spglobal.com |
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