With all the pullbacks, declines, and regressions seen across other areas of ESG, sustainable finance offers some positive news. A new report from Moody’s indicates that issuance of green bonds hit a record high in Q2 2026. ESG Today reports on the development:
“Overall, the report found that global issuance of labelled sustainable bonds – including green, social, sustainability, sustainability-linked, and transition bonds – increased by 4% year-over-year in Q2 2026, although issuance year-to-date remains slightly below H1 2025, following a slower Q1 2026.
By region, the report found that Europe has increased its dominance in the sustainable bond market, representing 58% of issuance volume in Q2 2026, and 56% in Q1, compared with 44% and 43% in the corresponding quarters last year, respectively. The Asia Pacific region represented 20% in Q2 2026, down sharply from 32% a year ago, while North America fell to 8% of issuance from 9%.”
This is the second piece of encouraging news to come from sustainable finance in Q2 2026. Sustainability funds also reversed a years-long trend and posted net inflows in the same quarter. However, unlike sustainability funds, which are seeing growth in the U.S., the increase in green bond issuance is largely driven by the EU. The European share of the green bond market is growing, accounting for almost 60% of green bond issuance. This is no surprise given the EU’s strong focus on sustainable finance strategies and regulations. It’s encouraging that green bonds hit a record high. However, one data point does not necessarily indicate a trend. We’ll have to see if sustainable finance continues to advance in the remaining quarters of 2026.
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