North American Sustainable Finance Issuance Drops, but Canada Remains Resilient

Sustainable Finance Awards 2026 highlights ESG backlash, regulatory tensions, and the rise of adaptation finance

Published on Mar. 9, 2026

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North American sustainable-finance issuance fell sharply in 2025 due to an ESG backlash and regulatory tensions, especially in the US, where prominent banks withdrew from the UN-convened Net-Zero Banking Alliance. However, Canada remained resilient, with leading banks continuing to prioritize ESG and increase issuance. The report also notes the emergence of adaptation finance as a major growth driver, as global attention shifts from mitigation to resilience amid increasingly frequent and severe extreme-weather events.

Why it matters

The decline in sustainable finance issuance in North America, particularly in the US, reflects the ongoing polarization and growing political scrutiny of ESG, as well as banks shifting focus to areas such as energy security. This trend raises concerns about the future of sustainable finance in the region and the ability to meet climate goals. However, the resilience of the Canadian market and the rise of adaptation finance offer some hope for the future of sustainable finance in North America.

The details

According to Moody's, sustainable-finance issuance in North America fell from $124 billion in 2024 to $67 billion in 2025, a far cry from the 2021 peak of $175 billion. Almost all the drop was attributable to the US, where prominent banks followed the six big players that withdrew from the UN-convened Net-Zero Banking Alliance beginning in December 2024. This reflects ongoing polarization and growing political scrutiny of ESG, as well as banks shifting focus to areas such as energy security. The sharp drop in ESG issuance was reflected in the paucity of North American entries Global Finance received for this year's Sustainable Finance Awards.

  • In 2024, sustainable-finance issuance in North America fell from $124 billion to $67 billion.
  • In December 2024, prominent US banks withdrew from the UN-convened Net-Zero Banking Alliance.
  • In 2021, sustainable-finance issuance in North America reached a peak of $175 billion.

The players

Moody's

A credit rating agency that provided data on the decline in sustainable-finance issuance in North America.

UN-convened Net-Zero Banking Alliance

An alliance of banks committed to aligning their lending and investment portfolios with net-zero emissions by 2050.

Sustainable Fitch

A Fitch Solutions company that forecasts ongoing challenges for investors navigating the North American ESG regulatory environment due to diverging pressures between state and federal requirements in the US.

Schroders

A multinational asset management company that anticipates an increased emphasis on demonstrating the returns and value of sustainability efforts.

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What they’re saying

“We expect investors to continue to face challenges navigating the North American ESG regulatory environment as diverging pressures persist between state and federal requirements in the US.”

— Sustainable Fitch (Fitch Solutions)

“There may be some momentum in late 2026 as Canada finalizes its new green and transition taxonomy.”

— Sustainable Fitch (Fitch Solutions)

“An increased emphasis on demonstrating the returns and value of sustainability efforts.”

— Schroders, Multinational asset management company (Schroders)

What’s next

The judge in the case will decide on Tuesday whether or not to allow Walker Reed Quinn out on bail.

The takeaway

The decline in sustainable finance issuance in North America, particularly in the US, highlights the need for policymakers and financial institutions to find ways to navigate the polarized ESG landscape and maintain momentum in sustainable investing. The resilience of the Canadian market and the rise of adaptation finance offer some hope, but more work is needed to ensure the long-term viability of sustainable finance in the region.