Japan-focused Rating and Investment Information (R&I) secured more than a 10% share of the sustainable finance second-party opinion market in 2024, joining the global 'big four' US providers led by Sustainalytics and S&P Global.
In addition, Sustainable Fitch continued to strengthen its market share in 2024 but US public finance-focused Kestrel Verifiers saw its share slip further as US sustainable debt markets slowed.
According to Environmental Finance Data (EF Data), R&I became the fourth largest SPO provider in 2024 with a 12.4% market share. In 2023, the Japan-focused firm was the fifth largest SPO provider with a 8.8% market share.
Among the framework SPOs that R&I provided in 2024 were those for state-owned road operator East Nippon Expressway, industrial conglomerate Fuji Corporation, and technology firm Rakuten.
This is the first year in which R&I secured a share in excess of the 10% milestone and means the Tokyo-based company has joined the 'big four' US firms which have been consolidating their market share since the start of 2023.
Morningstar-owned Sustainalytics retained its position as the largest provider with 18.6% of the total number during 2024, however – an increase on the 18.3% share it secured in 2023.
Among the frameworks assessed by Sustainalytics in 2024 were the updated sustainable bond framework from Ontario and sovereign green bond framework from New Zealand, as well as the green bond framework for US-based aluminium producer Alcoa, sustainability-linked bond framework for Turkish biscuit and chocolate maker Ülker, and the 'nuclear' green bond framework from US energy firm Constellation.
S&P Global, meanwhile, remained the second largest provider with a 17.2% share in 2024. Among the SPOs provided by S&P was the sustainable finance framework from the Dominican Republic, the updated green bond framework from Nordic Investment Bank (NIB), and the sustainability bond framework from Mongolian lender Golomt Bank.
10 largest SPO providers in 2024
| Rank | SPO Provider | Share by number | ||
|---|---|---|---|---|
| 2024 | 2023 (rank) | 2022 (rank) | ||
| 1 | Sustainalytics (US) | 18.6% | 18.3% (1) | 24.1% (1) |
| 2 | S&P Global (US) | 17.2% | 18.2% (2) | 19.9% (2) |
| 3 | Moody’s (US) | 12.9% | 12.5% (4) | 7.4% (6) |
| 4 | R&I (Japan) | 12.4% | 8.8% (5) | 2.8% (7) |
| 5 | ISS-Corporate (US) | 11.3% | 13% (3) | 16.4% (3) |
| 6 | Sustainable Fitch (US) | 8.4% | 3.9% (9) | 1% (10) |
| 7 | DNV (Norway) | 5.7% | 7.9% (6) | 10.4% (4) |
| 8 | Japan Credit Rating Agency (Japan) | 5.3% | 4.5% (8) | 2% (8) |
| 9 | Kestrel Verifiers (US) | 4.8% | 7.2% (7) | 8% (5) |
| 10 | NINT (Brazil) | 1% | 1.9% (10) | 0.8% (11) |
| * 2022 share and rank adjusted to reflect S&P’s acquisition of Cicero Shades of Green | ||||
| Source: Environmental Finance Data | ||||
Moody's continued to strengthen its market share to 12.9% in 2024, putting it in third place. ISS-Corporate, however, saw its market share slip to 11.3% which meant it lost of long-held position as the third largest provider but still maintained a strong position as the fifth largest provider.
In total, the top five providers saw their cumulative share grow to more than 72% in 2024 from 70% in 2023.
The biggest share jump in 2024 was recorded by Sustainable Fitch, which more than doubled its market share to 8.4% and rose from the ninth largest provider in 2023 to the sixth largest in 2024. This continues its rapid rise from just a 1% market share in 2022.
The Japan Credit Rating Agency (JCRA) also reported a material increase in its market share in 2024 to 5.3%. This was as amid significant Japanese sustainable debt activity in a year which saw Japan issue a ground-breaking sovereign transition bond – for which JCRA provided the SPO – and the government updating its green and sustainability-linked debt guidance.
In contrast, US municipals-focused Kestrel Verifiers reported the largest market share contraction in 2024 – falling 2.4 percentage points to 4.8%, and slipping to ninth largest.
"Amid consolidation in the SPO provider market, we have seen the top players fortify their positions [in recent years]," said EF Data senior research analyst Ashton Rowntree. "Meanwhile, an active Japanese sustainable bond market has benefitted local SPO providers like R&I and JCRA with their specialised knowledge of the domestic market."
The Environmental Finance figures are focused exclusively on SPOs, as opposed to other external review work – such as verification and assurance services. The figures include both new and updated assessments of green, social, sustainability, sustainability-linked and transition finance frameworks for bond and loans.