ESG & Sustainability Advisory Market

ESG & Sustainability Advisory Market Outlook (2023-2033)

The global ESG (environmental, social, and governance) & sustainability advisory market is poised to reach a valuation of US$ 39.3 billion in 2023. The market is estimated to grow at a CAGR of 6.3% and jump to US$ 72.4 billion by the end of 2033.

ESG is a set of standards by which a company and its investors can measure the wider impact of its operations and long-term strategy. In 2021, ESG funds attracted investments worth over US$ 1 billion from corporates worldwide.

Topics such as sustainability, green energy, net zero company, and renewable energy, among others, have become mainstream in the last 5 to 7 years. Both individuals and corporates have started taking sustainability seriously. Companies are trying to become net zero by integrating different kinds of action plans into their operations. On the other hand, individuals are paying close attention before making a purchase choice.

Corporations are spending millions of dollars in making changes in their operations net zero. From the use of renewable energy for their offices to a fully electric fleet for transportation, corporates are investing a lot in renewable resources. Apart from their corporate social responsibility (CSR) team, now they also have their very own individual ESG & sustainability team.

In the last few years, the global ESG & sustainability consulting industry has witnessed a lot of new entrants. Earlier, the market was considered to be a niche market; however, the entry of well-established advisory firms has changed the path of the industry forever.

• The next few years are expected to be highly busy for sustainability advisory firms amid increasing corporates’ as well individuals’ interest in sustainability.
• The success of the ESG & sustainability consulting market is totally dependent upon the acceptance of green products/services by consumers if they are ready to pay a premium for green products/services.
• Government initiatives will be seen for special recognition/considerations for net zero companies, tax benefits for companies producing green products, and rebates for individuals buying sustainable products/services.

Report Attributes	Details
ESG & Sustainability Advisory Market Size (2022A)	US$ 37 Billion
Estimated Market Value (2023E)	US$ 39.3 Billion
Forecasted Market Value (2033F)	US$ 72.4 Billion
Global Market Growth Rate (2023-2033)	6.3% CAGR
North America Market Share (2022)	~48%
East Asia Market Growth Rate (2023-2033)	~6.7% CAGR
United States Market Growth Rate (2023-2033)	~5.1% CAGR
Key Companies Profiled	Antea Group Arcadis NV Boston Consulting Group Environmental Resources Management (ERM) Ernst & Young Inogen Alliance Jacobs McKinsey & Group Mott MacDonald Ramboll Group A/S RSK Group Stantec & Cardno Tetra Tech Inc. Woodard & Curran WSP Global Inc.

Why is the ESG & Sustainability Advisory Market Exhibiting Rapid Growth?

“Rising Concerns about Climate Change”

Increasing concerns about sustainability and climate change have forced the corporate world to rethink the way it is carrying out business. Emissions from manufacturing plants and the adverse effects of toxic emissions from chemical and pharmaceutical companies are some of the factors contributing to high pollution in the environment.

This has led to an increase in the demand for outsourcing professional advisory services. Enterprises are getting in touch with ESG & sustainability consulting firms. Depending upon the industry of the company, the advisory team will provide their input to company personnel. Inputs related to sustainable uses of land, water & waste management, and efficient use of energy among others are being provided.

“Journey towards Net Zero Economy”

A net zero economy has a become global trend. Many countries are planning to become a net zero-carbon country by 2050. It simply means that a country will have to achieve greenhouse gas emissions to as close to zero.

This cannot be achieved without proper planning and execution. That’s where the need for professional sustainable advisors are required. Governments are partnering with ESG consulting firms to provide a roadmap and time-to-time evaluation of the plans. From governments to corporates, everyone is focusing on how to reduce greenhouse gas emissions so that they can achieve their respective targets. Continuous rise in the demand for sustainable and green products/services has led companies to shift their focus towards sustainability, ultimately leading to higher demand for ESG advisory services.

“Increasing Competition from BFSI and IT Companies”

Most professional services companies are shifting their focus to the ESG and sustainable space. This might result in a decrease in the dependency on specialist environmental consulting professionals.

After the entry of big-4 companies into sustainability consulting and with a given industry reputation, these companies are eating out the market share of specialized environment advisory firms. Environment specialist consulting firms need to differentiate themselves from these companies to maintain their status quo.

Professional service providers are investing heavily in expanding their portfolios, either by acquiring a small environmental consulting firm or by opening new locations. The trend is expected to continue amid rising demand for ESG and sustainability advisory services by companies from different sectors.

Image depicts market analysis of ESG & sustainability consulting based on end-use industry and region. Under the end-use industry, health & life science accounts for 21% share of the market.

Country-wise Insights

U.S. Corporates Account for Highest Demand for Environmental Consulting Services

The U.S. Environmental consulting market is matured in comparison to other large economies of the world. In the U.S., both governments and corporates have taken multiple initiatives to reduce their carbon footprint.

The U.S. is considered to be the largest polluter in the world. Corporates based out of the U.S. have started rolling out separate personal targets to achieve and become net zero companies in the next 20 years. Enterprises are taking the help of professionals to achieve these targets.

The U.S. accounts for almost 50% of the total demand for ESG & sustainability consulting services. The U.S. government has also formed a special regulation body to keep a close eye on the overall progress of the set targets.

Indian ESG & Sustainability Advisory Market to Grow to Unprecedented Levels

In the last 20 years, India has become one of the largest hubs for all kinds of production facilities. This has resulted in making India one of the largest contributors to world pollution. However, the Indian government and corporates are taking corrective measures to tackle rising gas emissions.

Companies are taking the help of environmentalists and professional sustainability advisers to curb the overall carbon footprint. The Indian government has taken multiple initiatives such as electrifying government-owned transportation services, use of renewable energy in production facilities, and special incentives and rebates for enterprises trying to become net zero companies.

The Indian ESG & sustainability consulting market is expected to grow at a CAGR of 6.5% over the next 10 years. From start-ups to well-established companies, everyone has shifted their focus towards green gas emissions and sustainability, resulting in increased spending on sustainable advisory services.

Category-wise Insights

Water and Waste Management Services to Be Most In-Demand

As water is considered to be scarce, how we humans use it is very important. Economies across the world have come to a mutual conclusion that we have to use water in the best possible way so that it can be preserved for the next generations.

Water is used in almost every process in the manufacturing industry. Industries such as oil & utilities, chemicals, garments, and other manufacturing industries use most of the usable water. Just to make the point clearer, on average, 1,800 gallons of water are used to produce the cotton needed for one pair of jeans.

As such, corporates have realized and have started taking the help of professional consulting firms to reduce the use of water in their day-to-day operation across industries. Demand for ESG & sustainability consulting firms to help businesses curb the emission of carbon and enhance their ESG performance to boost shareholder confidence will only increase over the coming years.

Health & Life Science Industry Requires the Most Help

The healthcare and life science industry is going through major changes as to how it operates. From strict government rules to customers’ expectations for sustainable products/services, the healthcare industry is finding it difficult to keep up with the required changes. Simply producing life-saving products/services is now not enough; governments and customers want to know how you are producing and what the impact of the whole process is on the environment.

To meet everyone’s expectations, the health and life science industry is taking help from professional environmentalists and specialized advisory firms. There are some firms who are specialized in providing consulting/advisory services only limited to health and life science companies. These advisory firms help them identify risks, develop strategies to tackle those risks, and finally implement steps to resolve the related issues.

Competitive Landscape

Key players associated with ESG & sustainability consulting services are Antea Group, Arcadis NV, Boston Consulting Group, Environmental Resources Management (ERM), Ernst & Young, Inogen Alliance, Jacobs, McKinsey & Group, Mott MacDonald, Ramboll Group A/S, RSK group, Stantec & Cardno, Tetra Tech Inc., Woodard & Curran, and WSP Global Inc.

Like any other consulting market, ESG & sustainability consulting is highly competitive due to the presence of several large and small firms. Earlier, it used to be only specialized sustainability advisory firms, as it was considered to be a niche topic/market. However, ever since it has become mainstream, the industry has seen the entry of well-established professional service firms.

• In February 2022, Deloitte China completed the acquisition of Carbon Care Asia, a sustainability consultancy based in Hong Kong.
• In October 2022, Arcadis NV, a leading sustainability consulting firm, completed the acquisition of DPS Group. This acquisition will help Arcadis become a leader in consulting and engineering management for life science and semiconductor manufacturing companies.

Fact.MR has provided detailed information about the providers of ESG & sustainability advisory services positioned across regions, revenue growth, and service offering expansion, in the recently published report.

Segmentation of the ESG & Sustainability Advisory Industry Research

• By Service :

  • Contaminated Land
  • Climate Change & Energy
  • Environmental Impact Assessment & Sustainable Development
  • Environment Management & Due Diligence
  • Water & Waste management
  • Others (Not Mentioned Elsewhere)

• By End-use Industry :

  • Health & Life Science
  • Defence & Security
  • Public Services
  • Energy & Utilities
  • BFSI
  • Consumer & Manufacturing
  • Transportation
  • Others (Not Mentioned Elsewhere)

• By Region :

  • North America
  • Latin America
  • Europe
  • East Asia
  • South Asia & Oceania
  • Middle East & Africa