This revenue valuation premium is robust across a number of industries – and especially pronounced in sectors where one would expect it. Many sectors showed some form of valuation premium for companies with a higher share of green revenues. In no sector was there a valuation discount. In sectors such as utilities (e.g. power generation, renewable electricity, grids) and industrials, which are directly linked to the transition, “greener” companies benefitted the most. So do companies in some close-to-consumer sectors selling more sustainable consumer products (e.g. consumer staples).66The key drivers behind this premium are, of course, somewhat speculative. The valuation premium is not automatic: to build investor confidence, companies must demonstrate profitability, a credible right to win and also communicate a clear green narrative. However, this premium clearly exists and brings many other benefits. Companies with green offerings tend to be exposed to higher- growth markets. They are more likely to benefit from supportive regulation. They are often able to achieve cheaper financing (as described above) and may be perceived to carry less long-term downside risk – all factors that build investor confidence and ultimately business valuations. Many sectors showed some form of valuation premium for companies with a higher share of green revenues. In no sector was there a valuation discount. About BCG’s valuation analysis BOX 3 This BCG valuation analysis covered more than 2,000 companies reporting green revenues from the Financial Times Stock Exchange (FTSE) Russell dataset. To ensure institutional relevance and data quality, BCG focused on companies with market capitalizations above $1 billion – those most likely to offer consistently high-quality financial disclosures. BCG conducted statistical regressions at the global and industry levels to isolate the impact of green revenue growth from other financial signals. The dataset tracks revenue shares linked specifically to green activities as defined by LSEG across more than 48 markets. To understand the impact of green revenues on valuations, BCG analysis focused on revenue multiples as these metrics provide insights into investor perceptions and company value. The price-to-revenue (P/R) multiple offers a measure of investor sentiment, responding to shifts in revenue performance and market expectations. Conversely, the enterprise-value-to-revenue (EV/R) multiple captures broader structural valuations and companies’ overall capital structure. Analysing both P/R and EV/R multiples reveals how green revenue growth can simultaneously influence investor sentiment and company valuations. Already a Multi-Trillion-Dollar Market: CEO Guide to Growth in the Green Economy 28

Already a Multi-Trillion-Dollar Market 2025