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Sustainable bond markets are still shrinking, but the real story is the splintering beneath the surface: while overall GSSS issuance continues to fall, sustainability-linked bonds have virtually collapsed, slipping to just 0.15% of global debt markets, even as a surge in blue bonds, pure-play issuers and late-year HY activity hint at pockets of renewed momentum. Investors and policymakers now face a market where complexity, additionality and tough taxonomy rules are challenging the credibility — and future growth — of labelled finance.

TLDR:

• 9fin data shows quarterly GSSS (Green, Social, SLB, Sustainable) issuance continued to fall in 2025. Total market issuance levels remain the strongest indicator of activity in the GSSS market — but this relationship does not hold for SLBs
• While global HY GSSS issuance in the first three quarters of 2025 was higher than the equivalent periods of the previous three years, its share as a proportion of overall HY issuance is low and generally declining. However, a strong start to Q4 could indicate there will be an overall rise in HY GSSS issuance in 2025
• Blue bonds are gaining popularity and tend to achieve strong execution dynamics. But challenges to market growth remain. EU taxonomy alignment is difficult and greater standardisation is needed
• An increasing number of ‘pure players’ are tapping the market, which could help to bolster GSSS issuance if more issuers follow suit. But investors should be aware of potential shortfalls in additionality

Issuance trends — HY and beyond

GSSS issuance continued to fall across all markets and regions in the third quarter, mirroring the decline over the previous two quarters. However, 9fin found issuance volumes across the quarter remained roughly consistent with that of 12 months prior.