Environmental Assessment of the Top 50 Climate-Smart Companies Accelerating the Low-Carbon Economy in the Built Environment, 2025

Harnessing Climate-Smart Innovations is Crucial to Achieve a Low-Carbon Economy with Sustainable Growth

In today's dynamic global landscape, shaped by decarbonization, urbanization, and digital transformation, Frost & Sullivan underscores the critical need for companies in the homes and buildings sector to redefine their core mission. Rising awareness among stakeholders, such as consumers, employees, suppliers, and policymakers, emphasizes the pivotal role of climate change mitigation in value creation, driving heightened focus on environmental compliance. Leading firms are adopting a holistic approach, integrating environmental considerations into their strategies, operations, and transparent reporting, thereby fostering trust and delivering benefits such as sustainable profitability, enhanced employee morale, responsible supply chains, and positive community impacts. Conversely, failure to address climate challenges risks value erosion, with many organizations grappling with implementation hurdles, balancing short-term financial goals with sustainability, and struggling to communicate progress effectively.

Frost & Sullivan employs its rigorous tool, the Climate-Smart Performance Index (CSPI), to evaluate and rank the top 50 companies in the sector based on published environmental metrics, offering stakeholders and investors valuable insights into climate performance and resilience. This report examines climate-smart solutions, encompassing hardware, software, and services that aim to reduce the environmental footprint of buildings and infrastructure while advancing decarbonization. These innovations, focused on cutting carbon emissions, enhancing energy efficiency, and optimizing performance, form a growing market. With 2024 as the base year, the analysis provides market size and forecasts through 2030 and highlights a transformative opportunity at the intersection of climate action and industry leadership.

Revenue Forecast

The revenue estimate for the base year 2024 is $193.39 billion, with a CAGR of 11.3% for the study period 2024-2030.

Scope of Analysis

Market Definition

Climate-smart solutions in the built environment encompass hardware, software, and services designed to mitigate the environmental impact of buildings and infrastructure while promoting decarbonization in the face of climate change. Innovations that reduce carbon emissions, enhance energy efficiency, and optimize building performance define this market.

Base Year

2024

Study Period

2024-2030

Forecast Period

2025-2030

Industry Segments

• Climate-smart building management
• Climate-smart home energy management
• Climate-smart building systems

Geographic Scope

• Global*
• North America
• Europe
• Asia-Pacific
• Rest of the World

The Impact of the Top 3 Strategic Imperatives on the Climate-Smart Solutions Industry

Innovative Business Models

• Why: Frost & Sullivan recognizes that traditional business models are increasingly unsustainable in the face of climate change. By fostering innovation in business models involving ecosystem integration, organizations can unlock new revenue streams, enhance brand reputation, and gain a competitive edge in the market.
• Frost Perspective: Frost & Sullivan advocates for strategic partnerships with business model innovation that optimizes and prioritizes sustainability while delivering tangible business benefits. Frost & Sullivan emphasizes the importance of circular business models and eco-friendly building technology products as emissions and waste regulations tighten, positioning sustainability as a competitive advantage.

Disruptive Technologies

• Why: Frost & Sullivan emphasizes the critical role of disruptive technologies in driving the transition to a low-carbon economy. Through its research and analysis, Frost & Sullivan has identified climate-smart technologies that can revolutionize the buildings and smart infrastructure industry and accelerate decarbonization efforts.
• Frost Perspective: Frost & Sullivan advocates for the adoption of climate-smart technologies, including heat pumps, smart thermostats, home energy management systems, IoT-enabled HVAC products and more, to revolutionize the industry and meet regulatory demands and attract sustainability-focused investments.

Transformative Megatrends

• Why: Megatrends in the homes and buildings industry are essential for achieving a sustainable and net-zero built environment.
• Frost Perspective: Frost & Sullivan advocates for leading and emerging businesses to prioritize leveraging Megatrends such as urbanization, digitalization, decarbonization, electrification, energy transition, and demographic change to align their portfolios to accelerate growth.

Growth Drivers

• Increasing awareness of the impacts of climate change drives demand for climate-smart solutions that mitigate greenhouse gas (GHG) emissions.
• Governments' stringent environmental regulations, initiatives and decarbonization targets will increase the adoption of climate-smart solutions and practices in the built environment.
• Rapid advancements in sustainable climate control solutions and digital technologies provide innovative solutions for reducing carbon footprints and improving sustainability in construction and building operations.
• There is a growing recognition of the importance of resilience planning, which prompts investments in climate-smart infrastructure and building designs.

Growth Restraints

• The high upfront costs of implementing climate-smart solutions can deter customers and investors.
• Complex decision-making processes involving multiple stakeholders with differing priorities can lead to delays and inefficiencies in implementing climate-smart solutions, particularly in high-value mega infrastructure projects.
• Ambiguous market conditions and an uncertain economic climate could shift the priority away from creating a sustainable built environment.
• Resistance to change and cultural norms within the industry can impede the adoption of climate-smart solutions, requiring education, creating awareness, and incentives to overcome.