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Laxman Pai, Opalesque Asia:

European private market ESG assets could skyrocket to EUR 1.2 trillion ($1.4 trillion) by 2025, said a study.

The report by PWC predicts ESG assets will account for 27.2% to 42.4% of the likely private markets AUM in Europe, up from 14.8% of a total of €1.7 trillion AUM in 2020, representing about €253 billion.

This would mean that ESG strategies would account for between 27.2% and 42.4% of European private markets. Real Assets, in particular, are poised to stand at the forefront of this surge; with ESG assets expected to account for 33.7% and 40.6% of Real Estate and Infrastructure's total respective AUM by 2025.

For the report, "EU Private Markets: ESG Reboot," PwC surveyed 200 general partners and 200 limited partners representing €46 trillion in global assets under management.

"Surging popularity of ESG-focused strategies is set to stage a 'reboot of historic proportions in Europe's private markets. The sheer extent of Europe's predominance in this realm will ultimately see the influence of the region transcending physical borders and spilling across the global landscape," the report stated.

PwC also said that this "explosion" in sustainable investment will see Europe alone making up between 31% and 36% of global private markets' ESG assets.

The report says the forecast is driven by four catalysts that are placing ESG and sustainability at the forefront of private markets investing: Shifting societal valu......................

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