Mobilizing Capital CLIMATE TRANSITION To transition to a low-carbon economy, an estimated $100 trillion to $150 trillion¹ in capital will be required to decarbonize the hardest-to-abate sectors over the next GS SUSTAIN provides a mosaic-based approach to three decades. assessing ESG under five principal areas: Governance, Operational Environmental and Social Performance, Product To support this work, we tap research and analytics tools Alignment, Controversies, and ESG Fund Holdings. By and teams from across the firm to inform our decisions analyzing data from ESG data providers and GIR equity and our approach to engaging with clients. We also analysts, the GS SUSTAIN team has identified what it create new products and services across a full range of believes to be the most relevant metrics through which to asset classes to provide differentiated, performance- evaluate ESG engagement for more than 7,000 companies. driven strategies that fit each client’s needs. 1—Global Financial Markets Association and Boston Consulting Group: “Climate Finance Markets and the Real Economy,” December 2020. Many of these metrics have been externalized via API so that clients can now analyze their portfolios through GS SUSTAIN’s Differentiated Insights and ESG lenses. In addition, GS SUSTAIN’s offering now includes an assessment of how these companies align with the Capabilities United Nations (UN) Sustainable Development Goals and the EU Taxonomy, which provides clients with further insight into potential revenue eligibility or alignment. We leverage proprietary insights and intelligence from our Global Investment Research (GIR) group to drive performance for our clients as they navigate the climate transition. By leveraging our industry-leading research and GIR expects that Green Capex will be the dominant driver analysis, our clients are better equipped to make decisions of global infrastructure over the next decade, with $6 trillion that drive results. of investment needed annually to decarbonize the world, address water needs, and shore up transportation and other GS SUSTAIN critical systems. Formed in 2007, the GS SUSTAIN team provides GS SUSTAIN’s 2021 publication, Green Capex: Making thought-leading research, data tools, and analysis that Infrastructure Happen, addresses the products and equip investors, companies, and other stakeholders with technologies that need investment, what is on track, resources to understand how innovation, regulation, where there is capacity for additional Green Capex among and implementation of ESG factors influence investment publicly traded companies, sectors where Green Capex is outcomes and broader capital flows. needed more urgently to help alleviate future supply-chain bottlenecks, and how companies investing in Green Capex Through GS SUSTAIN, our Global Investment Research have received support from equity markets. group has been at the forefront of bringing greater investor attention to the importance of ESG factors as a way of understanding how companies are managing 21st-century business risks. GS SUSTAIN published a thematic outlook In concert with the rest of the firm, GS SUSTAIN led our 2021 for investing as ESG focus shifts “From Aspiration to Action.” Global Sustainability Forum, attended virtually by more than 1,000 clients. Sustainability Report 2021 Climate Transition | Mobilizing Capital 3333