ESG Sector Coverage

Overview of Six Key Markets Where We See Opportunities for Our Clients

Energy Efficiency

From smart building and homes, to electric vehicles and intelligent traffic, the Energy Efficiency sector has seen as exponential growth in investments over the past few years, rising from $4.4bn in 2017 to $10.3bn in 2019. Increasing costs of energy, environmental issues, global CO2 policies and standards, as well as concerns relating to public safety and traffic congestion are all driving the need for companies to redefine their business models to remain competitive in an ever-evolving market.

Water

Increasingly urgent pressures on the world’s water resources, as well as a rapidly growing awareness of the value of water to global ecosystems and biodiversity, means that businesses focused on addressing these issues are attracting increasing investment and M&A activity. In the 8 months of 2019 alone, there were over 120 deals in water infrastructure. As the impact of climate change is felt ever more acutely on the world’s water supplies, and with $6.7tn in financing needed in water infrastructure by 2030, the coming decade is likely to see exponential growth in this ever important resource sector.

Waste & Recycling

Rising environmental concerns and government norms, alongside a changing regulatory landscape and commercial activity, has resulted in significant growth in the Waste Management sector in recent years. From the more traditional waste management companies to newer players in reverse logistics and recycling technology, this is a sector on the move having seen 96 corporate and VC deals in 2019.

Education

The education market is vast and fast growing, encompassing both the public and private sector, including provider-focused systems, student-focused software and content, corporate learning management systems and corporate training, e-learning and compliance. The speed of digitisation, growth in the technologies and declining hosting costs are all contributing to high growth levels across the sector and resulted in over 130 transactions in 2019, as we see a widespread adoption of app-based EdTech services across the globe.

Agtech

The growing recognition of the impact that agriculture is having on climate change, as well as the need for new new technology solutions across the entire supply chain means that AgTech will be a $177bn market by 2025. Having seen nearly 300 VC deals in 2019, the Agtech market is particularly active in the US, Europe and China and can be divided into two segments: software (farm management systems, weather and cartography software) and devices, including drones and advanced seeds sorting machines.

Healthcare

Ageing populations, technological developments, the increasing prevalence of diseases, and growth in the biologics and veterinary healthcare all mean that the Healthcare sector is more relevant and prescient than ever before. With a near doubling of investments between 2017 and 2019, Healthcare Services alone are expected to reach $12tn by 2026.

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Contents

  • COVID-19 update – a few ESG considerations
  • ESG trends
  • Valuation benchmarks

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