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1
Cortellini, Giuseppe, and Ida Claudia Panetta. "Green Bond: A Systematic Literature Review for Future Research Agendas." Journal of Risk and Financial Management 14, no. 12 (December 7, 2021): 589. http://dx.doi.org/10.3390/jrfm14120589.
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Green bonds (or climate bonds) are one of the most used sustainable investment instruments, and under the Paris Climate Agreement of 2015, the climate bond market is expected to thrive in the near future. Green bonds are gaining increasing popularity between environmentally responsible investors, as well as investors who “simply” attempt to benefit from portfolio diversification, including green issuances, that are close to other fixed bonds. This paper aims to take advantage of previous literature contributions on the green bond market to indicate the way forward for future research. Herein, through a systematic literature review on the green bond market, our ultimate goal is to provide investors, main markets actors, and policymakers with some helpful insight on the role of environmental investments in reshaping the financial markets and fostering the sustainability of the economy.
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Anh Tu, Chuc, Tapan Sarker, and Ehsan Rasoulinezhad. "Factors Influencing the Green Bond Market Expansion: Evidence from a Multi-Dimensional Analysis." Journal of Risk and Financial Management 13, no. 6 (June 13, 2020): 126. http://dx.doi.org/10.3390/jrfm13060126.
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Expansion of green bond markets as an appropriate way to lower environmental pollution is one of the most debatable issues among scholars. However, the expansion of this market is not a simple matter and depends on several factors. The main purpose of this study is to carry out a multi-dimensional analysis using the analytic hierarchy process (AHP) method to find and prioritize factors influencing the development of green bond markets. As a case, we do our analysis for Vietnam that, since the last years, has been trying to expand green bond market as an effective investment channel to finance low-carbon projects. The main findings revealed that legal infrastructure, official interest rate of green bonds, and economic stability are the most important factors directly affecting green bond market expansion. Therefore, economic and legal requirements should be addressed by policy makers. As major policy implications, we recommend an affordable price of green bonds and improvement of economic and financial stability to accelerate the development of green bond markets.
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Grishunin, Sergei, Alesya Bukreeva, Svetlana Suloeva, and Ekaterina Burova. "Analysis of Yields and Their Determinants in the European Corporate Green Bond Market." Risks 11, no. 1 (January 6, 2023): 14. http://dx.doi.org/10.3390/risks11010014.
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The green bond market helps to mobilize financial sources toward sustainable investments. Green bonds are similar to conventional bonds but are specifically designed to raise money to finance environmental projects. The feature of green bonds is the existence of greenium, or the lower yield compared to “conventional” bonds of the same risk. The relevance of the paper is underpinned by the mixed evidence on the existence of ‘greenium’, especially in corporate green bond markets; there has been limited research on the topic and a narrow focus on global, US, or Chinese green bond markets. Instead, the greenium in European debt markets remains underexplored. The objective of this study is to investigate the existence of greenium and its key determinants in European corporate debt capital markets, including the local markets of the United Kingdom (UK), France, Netherlands, and Germany. The sample included 3851 corporate bonds, both green and conventional ones, between 2007 and 2021 from 33 European countries. Linear regression was applied for the analysis. The results show that the climate corporate bonds in Europe are priced at a discount to the same-risk conventional corporate bonds. The magnitude of greenium is around 3 bps. Determinants of greenium include the presence of an ESG rating and belonging to the utility and financial industry. The remaining drivers of bond yields in the European corporate debt market are the credit quality (expressed by the level of credit rating), the coupon size, the bond tenor, the market liquidity, and macroeconomic variables (growth of gross domestic product and consumer price index). For the local corporate debt markets, our results are controversial. In all markets under consideration except for the UK and the Netherlands, we did not find sustainable evidence of greenium. The results of the research lead to a better understanding of the green bond market for investors, researchers, regulators, and potential issuing companies.
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Park, Daehyeon, Jiyeon Park, and Doojin Ryu. "Volatility Spillovers between Equity and Green Bond Markets." Sustainability 12, no. 9 (May 4, 2020): 3722. http://dx.doi.org/10.3390/su12093722.
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This study examines the market for green bonds, which have been in the spotlight as an eco-friendly investment product. We analyze the volatility dynamics and spillovers between the equity and green bond markets. As the return dynamics of financial products typically exhibit asymmetric volatility, we check whether green bonds also share this property. Our analyses confirm that although green bonds do exhibit the asymmetric volatility phenomenon, their volatility, unlike that of equity, is also sensitive to positive return shocks. An analysis of the association between the green bond and equity markets confirms that although the two markets have some volatility spillover effects, neither responds significantly to negative shocks in the other market.
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Cheong, Chiyoung, and Jaewon Choi. "Green bonds: a survey." Journal of Derivatives and Quantitative Studies: 선물연구 28, no. 4 (November 2, 2020): 175–89. http://dx.doi.org/10.1108/jdqs-09-2020-0024.
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This paper is a survey of recent academic developments in the literature on green bonds, which have become an important financial instrument in socially responsible investment. This study provides a review of papers that study the market pricing of green bonds, the economic and environmental effects of green bond financing, as well as legal and institutional issues in the green bond market. The literature on market pricing focuses mainly on the existence of greenium, which represents the extent to which green bonds carry a price premium over otherwise identical non-green counterparts. The literature on the economic and environmental effects mainly concerns stock market reaction to green bond issuance and associated economic value implications to other stakeholders, as well as investment in green projects. This paper discusses current issues in the green-bond market and avenues for future research.
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Wang, Qinghua, Yaning Zhou, Li Luo, and Junping Ji. "Research on the Factors Affecting the Risk Premium of China’s Green Bond Issuance." Sustainability 11, no. 22 (November 14, 2019): 6394. http://dx.doi.org/10.3390/su11226394.
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Green bonds have both “bond” and “green” attributes and are one of the important financing tools for green financial markets. The green bond risk premium directly reflects the financing cost of bond issuers and the capital gains of investors. A reasonable risk premium is the key to the successful issuance and trading of green bonds. Therefore, this paper studies the factors affecting the risk premium of China’s green bond issuance, aiming to provide a basis for determining a more reasonable risk premium. Based on the primary issuance market of green bonds, this paper takes into account the macro- and microscopic cross-sectional data of green bond issuance and comprehensively considers the main factors affecting the green bond risk premium from macro-influence factors, micro-influence factors, and green attribute factors. An empirical study of the factors affecting the risk premium of China’s green bond issuance was conducted using multivariate statistical regression analysis. The study found that the green attribute factor affecting the risk premium of green bonds is third-party green assessment certification. The bond factors affecting the risk premium of green bond issuance mainly include debt credit rating, issue period, and issue size, all of which affect the risk of green bond issuance. The issuer factors affecting the risk premium of green bonds include debt principal, nature of property rights, and return on net assets. The macro factor affecting the risk premium of green bonds is the current market interest rate.
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Taghizadeh-Hesary, Farhad, Abdulrasheed Zakari, Rafael Alvarado, and Vincent Tawiah. "The green bond market and its use for energy efficiency finance in Africa." China Finance Review International 12, no. 2 (March 4, 2022): 241–60. http://dx.doi.org/10.1108/cfri-12-2021-0225.
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PurposeThis study presents the state of green bond markets in Africa and green bond funds by some countries in the continent.Design/methodology/approachThe authors adopt a case study approach on four different kinds of countries, namely oil-rich economy, green bond innovator, renewable energy user and carbon vulnerability.FindingsThe authors found that Africa's green bond is still at the early stages. However, countries are using innovative ways that are adaptable to their current economic conditions and investment attractiveness in issuing green bonds. While some countries focus on central and local government bonds, others use corporate bonds, few combine government and corporate green bonds. Interestingly, the first green bond globally certified by the Climate Bonds Standard was issued by an Africa country in Africa. In some selected countries such as Nigeria, South Africa, Morocco, Namibia and Kenya, green bond markets have seen massive growth and have contributed to numerous infrastructural energy efficiency projects. To expand this market further in these countries, the authors recommend fostering a public–private partnership backed by policies and political will.Originality/valueThis study provides an original contribution to the green bond and its likelihood of driving energy efficiency in a continent that has attracted little to no attention in the literature.
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Lebelle, Martin, Souad Lajili Jarjir, and Syrine Sassi. "Corporate Green Bond Issuances: An International Evidence." Journal of Risk and Financial Management 13, no. 2 (February 4, 2020): 25. http://dx.doi.org/10.3390/jrfm13020025.
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Using an international sample of corporate Green bond issuances over the recent period, this paper highlights the potential consequences of the issuance of a Green bond on the issuer’s financial performance. Starting with a first sample of 2079 Green bond issuances of 190 unique issuers from 2009 to 2018, we investigate only corporate green bond issuances. Our final sample contains 475 green bonds issued by 145 unique firms. We find that the market reacts negatively to the announcement of green bond issuances. In particular, results show that the stock market reacts on the day of the green bond announcement date and the day after, and that the cumulative abnormal return is between −0.5% and −0.2%, depending on the asset pricing model (CAPM, the 3-factor Fama and French models, and the 4-factor Carhart models). This effect is mainly noticeable at the first Green Bond issuance and in developed markets. Our results provide evidence that the investors react in the same manner for Green bonds as for conventional or convertible bonds. This evidence suggests that green debt offerings convey unfavorable information about the issuing firms.
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Deschryver, Pauline, and Frederic de Mariz. "What Future for the Green Bond Market? How Can Policymakers, Companies, and Investors Unlock the Potential of the Green Bond Market?" Journal of Risk and Financial Management 13, no. 3 (March 24, 2020): 61. http://dx.doi.org/10.3390/jrfm13030061.
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The green bond market is attracting new issuers and a more diversified base of investors. However, the size of the green bond market remains small compared to the challenges it is meant to address and to the overall traditional bond market. This paper is based on a unique methodology combining an extensive literature review, market data analysis, and interviews with a large spectrum of green bond market participants. We identify the current barriers explaining the lack of scalability of the green bond market: a deficit of harmonized global standards; risks of greenwashing; the perception of higher costs for issuers; the lack of supply of green bonds for investors; and the overall infancy of the market. This paper makes several recommendations to overcome these obstacles and unlock the full potential of green bonds to finance sustainability goals.
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Sun, Zhen, Jianfen Feng, Rongxi Zhou, Yue Yu, and Yaojian Deng. "Can Labeled Green Bonds Reduce Financing Cost in China?" Sustainability 14, no. 20 (October 19, 2022): 13510. http://dx.doi.org/10.3390/su142013510.
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From the perspective of financing cost, this article investigates the benefits of green bonds to the issuer. Based on 227 green bonds and 405 conventional bonds selected from China’s bond market, we find that (1) green bonds can decrease financing cost by at least 15 bps in the primary market, which is more significant than the effect in the secondary market; (2) third-party certification can strengthen the ‘greenium’ of green bonds in both the primary and secondary markets; and (3) there is no ‘greenium’ effect for financial green bonds in either primary or secondary markets in China, even for green bonds with third-party certification.
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Karginova-Gubinova, Valentina, Anton Shcherbak, and Sergey Tishkov. "Efficiency of the green bond market and its role in regional security." E3S Web of Conferences 164 (2020): 09040. http://dx.doi.org/10.1051/e3sconf/202016409040.
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Financing capital-intensive projects in the green economy is possible through green bonds. The assessment of the economic efficiency of the green bond market, the determination of its role in ensuring the energy and economic security of the regions and the development of directions and instruments for improving the efficiency and significance of the market for the Russian Federation are the aim of the study. The methodology involved the determination of the autocorrelation presence in the calendar series of bond yields using the Broysch-Godfrey LM test, the application of applied statistics methods to verify the existence of calendar effects on the stock exchange and analyze market reviews. Data on the green bond market were compared with data on other bonds. Market performance calculations were based on the S&P Green Bond Index and S&P 500 Bond Index. Features and benefits of green bonds as an instrument to ensure regional security were identified. The lack of market efficiency for green and other bonds, even in a weak form, was shown. The necessary institutional changes to improve the efficiency of the green bond market and develop it in the Russian Federation have been proposed. The findings are of theoretical importance, complementing the work on testing the hypothesis of an effective market, and of practical importance in the form of recommendations for on market improving.
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Gyamerah, Samuel Asante, Bright Emmanuel Owusu, and and Ellis Kofi Akwaa-Sekyi. "Modelling the mean and volatility spillover between green bond market and renewable energy stock market." Green Finance 4, no. 3 (2022): 310–28. http://dx.doi.org/10.3934/gf.2022015.
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<abstract><p>In this paper,we investigate the mean and volatility spillover between the price of green bonds and the price of renewable energy stocks using daily price series from 02/11/2011 to 31/08/2021. The unrestricted trivariate VAR-BEKK-GARCH model is employed to examine potential causality,mean,and volatility spillover effects from the green bond market to the renewable energy stock market and vice-versa. The results from the VAR-BEKK-GARCH model indicate that there exists a uni-directional Granger causality from renewable energy stock prices to green bond prices. While the price of green bonds is positively influenced by its own lagged values and the lagged values of renewable energy stock prices,only the past price value of renewable energy stocks has a positive effect on the current price value. We identified a uni-directional volatility spillover from renewable energy stock prices to green bond prices. However,there was no shock spillover from both sides of the market. This research shows that investors in the green bond market should always consider information from the renewable energy stock market because of the causal link between renewable energy stocks and green bonds.</p></abstract>
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Li, Haolan, Tiancheng He, Xihong Liao, and Weizhen Tong. "China’s Green Bond Market: Structural Characteristics, Formation Factors, and Development Suggestions—Based on the Comparison of the Chinese and the US Green Bond Markets Structure." International Journal of Antennas and Propagation 2022 (October 4, 2022): 1–15. http://dx.doi.org/10.1155/2022/1890029.
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Since 2012, green bond markets have boomed worldwide, particularly in the European Union, the United States, and China. Under this background, the researchers use the methods of literature research, qualitative analysis, and descriptive research to compare the structure of Chinese and American green bond markets and analyze their differences from the perspective of historical evolution, issuance standards, and market operation characteristics. The researchers believe that China’s bank-oriented financial structure and America’s market-oriented financial structure are the main reasons for the difference between the two countries. The researchers then discuss the strengths and weaknesses of China’s green bond market and conclude that the advantages of China’s green bond market structure lie in low risk and close relationships between banks and enterprises, while the disadvantages lie in low financial efficiency and give relevant suggestions. This article makes up for the lack of cross-country comparison in the existing research on the green bond market and provides a qualitative research perspective. The suggestions put forward have specific policy significance for developing the green bond market in China and other developing countries.
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Kim, Hak-Kyum, and Hee-Joon Ahn. "Is There a Greenium in Korean Bond Markets?: An Empirical Analysis of Bond Secondary-Market Trading Data*." Korean Journal of Financial Studies 51, no. 4 (August 31, 2022): 383–416. http://dx.doi.org/10.26845/kjfs.2022.08.51.4.383.
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We examine the secondary-market bond trading data from May 2018 to December 2021 to see if there exists a green premium or ‘greenium’ in Korean bond markets. We employ two empirical approaches — a matched sample analysis that compares green bonds with matched conventional bonds of similar characteristics, and a regression model that controls for the fixed effects related to issuer, maturity, credit rating, and trading year and month. We find the existence of a greenium in Korean debt markets with strong chronological trends. The greenium is observed prior to the outbreak of the Covid-19 pandemic but disappears during the outbreak period. The greenium then reappears distinctly after the government’s declaration of carbon neutrality near the end of Year 2020. Our study is the first that empirically examines the existence of green premium in the Korean bond markets based on a reasonably large sample size. The strong greenium reported in our study justifies the existence and expansion of green bond markets in Korea. It also offers valuable additional evidence to the academic discourse on green premium in global debt markets.
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Dietz, Sara. "Green Monetary Policy Between Market Neutrality And Market Efficiency." Common Market Law Review 59, Issue 2 (April 1, 2022): 395–432. http://dx.doi.org/10.54648/cola2022030.
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Confronted with the challenges of climate change, the ECB adopted a Climate Change Action Plan in July 2021 and thereby joined forces with Member States and EU institutions to support Europe’s green transition to a CO2-neutral environment. The measures in the Action Plan aim to internalize climate risks, integrating sustainability-linked bonds into the monetary policy framework and hint at an even more active climate policy by way of preferential green bond purchases. This article analyses to what extent the mandate of the ECB allows for such a green monetary policy, focusing on the admissibility of monetary policy measures containing a “green bias” that discriminate against environmentally unsustainable or carbon-intensive economic activities. The ECB uses the principle of market efficiency to defend preferential green bond purchases. According to the ECB, as long as market participants do not yet adequately price in the costs of climate change and unsustainable economic activities, the ECB should step in and correct these market dysfunctionalities to ensure an efficient allocation of resources.This is a contested novelty in euro area monetary policy, since the ECB has so far adhered to the principle of market neutrality with regard to the allocation of its bond purchases. ECB, central banking, mandate, monetary policy, climate change, institutional balance, sustainable finance
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Kim, Hak-Kyum, and Hee-Joon Ahn. "Is There an Issuance Premium for SRI Bonds?: Evidence from the Periods Before and After the COVID-19 Outbreak." Korean Journal of Financial Studies 50, no. 4 (August 31, 2021): 369–409. http://dx.doi.org/10.26845/kjfs.2021.08.50.4.369.
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This study empirically examines whether there are any issuance premia for Socially Responsible Investment (SRI) bonds, using the data from the South Korean bond market from May 2018 to December 2020. We classify SRI bonds into three types: green, social, and sustainability. We divide the sample period into pre-COVID-19 and post-COVID-19 to understand how the pandemic has impacted the pricing of SRI bonds. We employ two empirical approaches: a matching sample analysis and a regression analysis that controls various bond and market characteristics. We find the following. First, significant issuance premia of at least 8bp existed for our sample of social bonds. However, we do not find any evidence of an issuance premium from the other two types of bonds. The premia on social bonds decreased significantly after the outbreak of COVID-19. As most studies have focused on green bonds, the literature on SRI bonds has largely been silent about social bonds and sustainability bonds. By focusing on these two less researched SRI bond types in addition to green bonds, we help expand our knowledge on SRI bond markets. Moreover, to the best of our knowledge, this is the first study to examine the SRI bond market in South Korea.
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Hadaś-Dyduch, Monika, Blandyna Puszer, Maria Czech, and Janusz Cichy. "Green Bonds as an Instrument for Financing Ecological Investments in the V4 Countries." Sustainability 14, no. 19 (September 26, 2022): 12188. http://dx.doi.org/10.3390/su141912188.
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The aim of this paper is to characterise the green bond market in the Visegrad Group of countries (V4) and to identify the determinants and benefits of issuing green bonds. The specific objective is a spatial–temporal analysis of the green bond yield in V4 countries. The following research methods were used in the paper: a source literature analysis and report analysis, statistical data analysis (from international financial markets), and the Dynamic Time Warping method (DTW). DTW comprises a class of algorithms that are used to compare both equal and unequal time series. The DTW method allows the smallest distance between two time series of different lengths to be found while allowing for the transformation over time of both series. As the method is highly efficient, it is used to provide a thorough spatial–temporal analysis of green bonds. The research process confirmed that green bonds are an instrument with potential in the global debt market. Among the most important stimulants for the issuance of green government bonds are capital mobilisation, the development of the green financial market, investor demand, and reputational benefits.
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Emets, M. I. "Modeling the green bond yield on bond offering." Finance and Credit 26, no. 12 (December 25, 2020): 2858–78. http://dx.doi.org/10.24891/fc.26.12.2858.
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Subject. The article addresses the green bond pricing as compared to bonds other than green ones. Objectives. The aims are to determine how the fact that a bond is identified as a green one, the issue amount, and the availability of third-party verification, influence the yield to maturity; to make recommendations on effective green bond pricing. Methods. The study employs econometric testing of hypotheses, using the multiple linear regression. The sample includes 318 green and 1695 conventional bonds. Results. Green bonds have a lower yield to maturity in comparison with conventional bonds. The yield to maturity of green bonds with third-party verification is lower, as contrasted with green bonds without verification. Conclusions. The next step in the green bond market development is creating a benchmark yield curve for sovereign green bonds, with parallel issuance of conventional, non-green bonds. The yield curve is crucial for effective bond pricing. Two yield curves, i.e. for green and non-green bonds, will enable investors to estimate the fair price on issuance, as well as to define, if there is a difference in pricing.
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Abakah, Emmanuel Joel Aikins, Aviral Kumar Tiwari, Aarzoo Sharma, and Dorika Jeremiah Mwamtambulo. "Extreme Connectedness between Green Bonds, Government Bonds, Corporate Bonds and Other Asset Classes: Insights for Portfolio Investors." Journal of Risk and Financial Management 15, no. 10 (October 18, 2022): 477. http://dx.doi.org/10.3390/jrfm15100477.
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This paper aims to examine the connectedness between green and conventional assets, particularly during the period of economic downturn. Specifically, we examine quantile-based time-varying connectedness between the green bond market and other financial assets using quantile vector autoregression (QVAR) from 9 March 2018 to 10 March 2021. We use daily prices of S&P U.S. Treasury Bond Index, S&P US Aggregate Bond Index, S&P US Treasury Bond Current 10Y Index, S&P 500 Bond Index, S&P 500 Financials index, S&P 500 Energy Bond Index and S&P 500, giving a total of 784 observations, and using Composite Index as a representative of conventional assets classes and S&P Green Bond Index to denote the green bond market. Results shows the connectedness between green bonds and the conventional asset classes intensified during the outbreak of the Coronavirus pandemic (COVID-19) as investors shifted their investment towards fixed income assets due to the plunge in the prices of stocks and commodities. The results also shows that green bonds are strongly connected with treasury bonds, aggregate bonds and bond index, as they share similarities with respect to issuance, risk and governance. Connectedness is weak in the case of composite index and energy bond index, as their prices do not have substantial influence on the green bond market. The study highlights the hedging and diversification benefits of green bonds. We have several implications for portfolio managers, policy makers and researchers.
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Dubko, Anastasiia. "PROSPECTS AND BARRIERS TO THE DEVELOPMENT OF THE GREEN BONDS MARKET IN UKRAINE." Baltic Journal of Legal and Social Sciences, no. 2 (October 25, 2022): 58–64. http://dx.doi.org/10.30525/2592-8813-2022-2-10.
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The article reveals the essence and substantive features of such a financial instrument as green bonds, the purpose of which is to attract funds for the financing of green projects, highlights the objective perquisites for the need to initiate and develop the green bond market in Ukraine, as well as the current legal status of this type of debt securities. Attention is paid to the essence of the category of “green financing”, a constituent element of which is considered to be green bonds, in particular, as a form of mobilizing funds for the implementation of green projects. The current state of the capital market in Ukraine, including the debt capital market, is studied, and barriers to the functioning of the domestic green bond market are identified, including problems of an economic (budgetary, tax), institutional, regulatory and political nature. Prospects for the development of the green bond market in Ukraine are identified, in particular, given the potential need to reformat the domestic energy system in the context of the “green” transition due to the devastating consequences of russian armed aggression in 2022.
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Agrawal, Rachna, and ASHIMA VERMA. "Green Bond Market: A Critical Review." International Journal of Business and Globalisation 1, no. 1 (2021): 1. http://dx.doi.org/10.1504/ijbg.2021.10040790.
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Kiseleva, E. "Green Bonds: New Trends in the Global Market and Opportunities for Russian Economy." World Economy and International Relations 65, no. 2 (2021): 62–70. http://dx.doi.org/10.20542/0131-2227-2021-65-2-62-70.
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Environmental finance has a reputation for delivering market-leading content based on honest and unbiased reporting, cutting-edge research and profound attention to detail. All of the above have placed it at the top of the rapidly growing green bond market. The paper argues that the green label earned with the usage of technologies that prevent environmental pollution or contribute to the stabilization of the environmental situation makes it much easier to obtain external financing on global market. The analysis of the global green bond market dynamics has revealed that almost 70% of the total amount of green bonds were issued in between 2017 and 2019. Based on the data systematization of various open sources the new trends in the global green bond market were identified. The primary trends among them include the growth in the number of smaller deals, the use of mixed funding, the extension of the labelled bonds in the market and the new climate bonds Taxonomy. The conducted analysis of green bonds issues in Russia has shown that the first issue took place in May 2019, although several major Russian companies have been making statements about their intentions to issue green bonds since 2015. The paper states the reasons for the «green» potential reduction as well as for Russia’s low involvement in the global green market. Those reasons mainly are products of immature legislative framework – poor development of regulation and legislation – and lack of its own green bond standards along with the required transparency, accuracy and integrity of disclosed information on issues to stakeholders. The creation of a sustainable development sector on Moscow stock exchange in 2019 provides to increase the issue of green bonds. Having analyzed the stated above the paper proves that the establishing of a unified green investment center linked to the Bank of Russia, as well as increasing transparency and openness of business, not only ensures the increase of green bonds issue in Russia but also contributes to overall environmental stability.
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Janković, Irena, Vlado Kovačević, and Isidora Ljumović. "Municipal green bond yield behaviour." Ekonomika preduzeca 70, no. 3-4 (2022): 206–14. http://dx.doi.org/10.5937/ekopre2204206j.
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The aim of this paper is to study municipal green bonds as fixed-income instruments used for environmentally friendly projects. This research was motivated by the absence of an effective global CO2 pricing scheme, making green bonds one of the most important instruments to tackle climate change. After an overview of the U.S. municipal green bond market, yields of municipal green bonds vs. ordinary municipal bonds were analysed. S&P U.S. Municipal Green Bond Index and S&P U.S. Municipal Bond Index were used in the study. The methodological framework includes a review of relevant literature, descriptive statistics with correlation analysis and hypotheses testing. As initially expected, significant positive correlation between green bond and ordinary bond yields was found, where green municipal bonds generate slightly lower yields than otherwise similar ordinary bonds. The existence of a statistically significant yield discount, i.e., a green premium, has not been confirmed.
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Björkholm, Linn, and Othmar M. Lehner. "Nordic green bond issuers’ views on the upcoming EU Green Bond Standard." ACRN Journal of Finance and Risk Perspectives 10, no. 1 (2021): 222–79. http://dx.doi.org/10.35944/jofrp.2021.10.1.012.
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The green bond market is growing and becoming increasingly important in green finance and for the transition to a low-carbon economy. Still, the green bond market is to a large extent unstandardised. There is no commonly agreed definition of the term ‘green’. This has been seen as one of the biggest challenges when it comes to the development of the green bond market. The need of a unified EU standard has been raised and as an effect the establishment of the EU Green Bond Standard is now in development. However, new standards might not only bring advantages, but also challenges. Striking the right balance of strictness might be hard. The research has been conducted through qualitative method with semi-structured interviews. Nine interviews were held during November and December 2020. The data was then analysed through thematic coding in order to find patterns of meaning. The results show that Nordic green bond issuers overall are positive towards the EU Green Bond Standard. The EU GBS has a good aim, to harmonise and enlarge the green bond market. However, the standard brings challenges that are to a large extent known challenges which the EU GBS aims to address, such as labour intensive reporting processes, lack of initiative and reputational risk. Also, it is argued that the standard is not fair and applicable for all the countries and companies. Countries national laws may not always go hand in hand with the standard. For example, the requirements for green buildings are seen as challenging in the Nordics. If these challenges are not taken into consideration, Nordic green bond issuers fear that the market will not grow, but instead decrease. Additionally, Nordic green bond issuers argue the adoption of the EU GBS is not a guarantee for issuers. Bigger institutes are seen to be early adopters. For other issuers investor requirement and positive impact on their company reputation is seen as the key drivers for adoption of the standard.
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Keliuotytė-Staniulėnienė, Greta, and Kamilė Daunaravičiūtė. "The Global Green Bond Market in the Face of the COVID-19 Pandemic." Financial Markets, Institutions and Risks 5, no. 1 (2021): 50–60. http://dx.doi.org/10.21272/fmir.5(1).50-60.2021.
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This paper summarizes the relevant researches in the area of the green bond market within the perspective of the performance of the global green bond market in the face of the COVID-19 pandemic. Despite the rapid expansion of the green bond market during the last decade, this market has also experienced the consequences of the COVID-19 pandemic. The researches on the effect of COVID-19 and its induced crisis on the green bond markets are still fragmentary; therefore, the main purpose of this research is to evaluate the impact of the COVID-19 pandemic on the global green bond market. To reach the purpose, the methods of literature analysis, and correlation-regression analysis are used. In the first section of the paper, the research problem is presented; in the second part the analysis of academic literature is conducted; in the third part the design of the research is described, and in the fourth part the results of the assessment of the impact of COVID-19 pandemic on the global green bond market are discussed. The results of the research revealed that the spread of the COVID-19 pandemic appeared to have a negative impact on the performance of the S&P Green Bond Index. The market reaction to deaths caused by COVID-19 infection proved to be stronger than the reaction to confirmed cases of COVID-19 infection. However, after a sufficiently significant negative shift, which was observed in the first quarter of 2020, the S&P Green Bond Index regained its upward trend, which continued for the rest of the year.
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Kant, A. "Practical Vitality of Green Bonds and Economic Benefits." Review of Business and Economics Studies 9, no. 1 (March 4, 2021): 62–83. http://dx.doi.org/10.26794/2308-944x-2021-9-1-62-83.
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Climate change is an overarching challenge for achieving sustainable development. “Green” or “Climate” Bonds are often seen as a financial instrument that may help overcome low-carbon investment defiance. This paper explores green bonds’ potential contribution to low-carbon transition and the corporate sector’s benefit following the stock market reaction. This paper focuses on a new and fascinating subject because the green bonds market is under constant scrutiny since the emergence of the first green bond in 2007. Anticipating the significance of action towards climate change is continuously increasing over time. This project can be seen as a supporting argument for investing in green bonds and fighting against climate change. This study investigates the recent developments and challenges in the green bond market. I used matching criteria and performed multivariate OLS regression to test whether the green bond is priced differently than conventional ones. The result finds that green bonds are cheaper than conventional bonds with a 1.93–2.24 per cent premium, consistent with prior studies in this topic. I used a sample of 200 corporate green bonds issued after the Paris Agreement, i. e., from December 2015 to December 2019. I further document that the stock market reacts positively to green bonds’ announcements. For this, I performed the CAR test on a company’s stock price, which gives a statistically significant abnormal return of 0.23 per cent and 1.14 per cent over time windows 10 and 20 days, respectively. Moreover, green bonds’ environmental performance on carbon emission reduction proved to be an insignificant player. For this, I tested a relationship between green bond labels and the firms’ carbon emission. The mixed results suggest that maybe green bonds are performing well economically, but it is still far from achieving its practical goal.
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Bansal, Sourabh. "Green Bonds-Trend and Challenges in India." Journal of Business Management and Information Systems 7, no. 1 (July 7, 2020): 22–30. http://dx.doi.org/10.48001/jbmis.2020.0701003.
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Green bonds in Indian market play a vital role to shape the debt market and to position the environment sustainability by generating funds specifically for green projects. The objectives of this paper is to understand the green bond as an environmental sustainable tool and further to draw the trend of green bond and challenges so far in context to the Indian financial market. The emergence of green/climate bonds takes place from Paris Agreement in 2015 where 188 countries sign up to limit the rising temperature by less than two degree Celsius and India is one of the countries to sign the agreement. The paper is based on a descriptive study using secondary data source from several government reports, other published reports and banking sector reports. The paper concludes that the green bond successfully fulfils criteria to become a sustainable tool which can be seen as an investment opportunity alternative to equity funds, other corporate bonds. The green bond trend is upward sloping showing great potential to grow and develops the sustainable goals with success achievement. Certain challenges as hedge currency cost, lack of awareness, low sovereign rating makes green bonds a less attractive among investor which can be fairly reduced by proper governmental strategic actions.
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Oche, Alex. "Comparative analysis of green bond regimes in Nigeria and China." Journal of Sustainable Development Law and Policy (The) 11, no. 1 (November 10, 2020): 160–84. http://dx.doi.org/10.4314/jsdlp.v11i1.8.
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Climate change has taken the centre stage in the debate of most governments around the world. At regional and international levels, efforts are being made to manage the problems emanating as a result of climate change. Response to the climate change can be summarized under two headings, namely, adaptation and mitigation measures. These measures do not come by cheaply, however. They are capital intensive; hence private sector funds will be needed to fund these adaptation and mitigation projects as public sector funding has remained insufficient. One way to mobilize private sector funds to tackle climate change is by using green bonds. But for green bonds to achieve its potentials as a sustainable investment tool, there must be a solid regulatory framework for the green bond market. Towards that end, this article analyses soft law instruments as well as national green bond regulations of Nigeria and China. It has been discovered that the Climate Bonds Standard and the Green Bond Principles form the basis of most jurisdictions of green bond regulations. nevertheless, due to regulatory arbitrage, there is no consensus green standard, and this poses a governance challenge to the green bond market. The article concludes that much of the responsibilities in setting green standards and enforcement of green standards rest on the domestic green bond regulations, and this can only be achieved with water-tight regulations for green bonds at domestic levels.
Keywords: Climate Change; Green Bonds; Nigeria; China.
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Lichtenberger, Andreas, Joao Paulo Braga, and Willi Semmler. "Green Bonds for the Transition to a Low-Carbon Economy." Econometrics 10, no. 1 (March 2, 2022): 11. http://dx.doi.org/10.3390/econometrics10010011.
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The green bond market is emerging as an impactful financing mechanism in climate change mitigation efforts. The effectiveness of the financial market for this transition to a low-carbon economy depends on attracting investors and removing financial market roadblocks. This paper investigates the differential bond performance of green vs non-green bonds with (1) a dynamic portfolio model that integrates negative as well as positive externality effects and via (2) econometric analyses of aggregate green bond and corporate energy time-series indices; as well as a cross-sectional set of individual bonds issued between 1 January 2017, and 1 October 2020. The asset pricing model demonstrates that, in the long-run, the positive externalities of green bonds benefit the economy through positive social returns. We use a deterministic and a stochastic version of the dynamic portfolio approach to obtain model-driven results and evaluate those through our empirical evidence using harmonic estimations. The econometric analysis of this study focuses on volatility and the risk–return performance (Sharpe ratio) of green and non-green bonds, and extends recent econometric studies that focused on yield differentials of green and non-green bonds. A modified Sharpe ratio analysis, cross-sectional methods, harmonic estimations, bond pairing estimations, as well as regression tree methodology, indicate that green bonds tend to show lower volatility and deliver superior Sharpe ratios (while the evidence for green premia is mixed). As a result, green bond investment can protect investors and portfolios from oil price and business cycle fluctuations, and stabilize portfolio returns and volatility. Policymakers are encouraged to make use of the financial benefits of green instruments and increase the financial flows towards sustainable economic activities to accelerate a low-carbon transition.
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Dunas, N. V. "Global Trends anTheoretic aspects of the formation and development of public-private partnership (PPP) are studied. By using a systemic approach, it is determined that the most important factor in improving the efficiency of public-private partnership is its institutional support. It is substantiated that globally, the PPP is mostly initiated by public authorities, which can be explained by a number of reasons. Firstly, public authorities are responsible for the country's strategic development. Secondly, public authorities formulate "rules of the game" for businesses and individuals, plan capital investments, and select PPP entities that are a priority in terms of public interest. In fact, it is the state that undertakes to address objectives facing society. Therefore, nowadays the importance of creating a favorable institutional environment to develop PPPs is recognized at all the levels of economic management and is emphasized in the scientific community. It is proved that the interests of public authorities, private businesses and the community are reconciled through the complementation of political, legal, and socio-economic norms and rules of conduct. The functions of public authorities at the national and regional levels of government are systematized. d Initiatives in Forming the Green Bonds Market in the Context of COVID-19." PROBLEMS OF ECONOMY 2, no. 48 (2021): 4–16. http://dx.doi.org/10.32983/2222-0712-2021-2-4-16.
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The article is aimed at studying the current global trends and national initiatives in forming a green bonds market in Ukraine through attracting investment to implement environmentally important projects in the area of energy conservation. The essence and key features of “green” bonds as an effective financial instrument for the implementation of environmentally friendly projects in economy are revealed. Analytical review of the green bond market development in the international space and European countries has helped to identify global investment trends and a number of essential features of “green bonds” as a lucrative investment asset in the long run, which brings positive socio-economic and environmental effects. The legal base and regulatory aspect of the formation of the green bonds market in the national economy is compared with those of the developed countries. The main provisions of forming the state policy on the green bond market in Ukraine are analyzed, taking into account the expected results of attracting finance in the sphere of energy efficiency. The risks and promising areas of implementing the Concept of introduction and development of the green bonds market in Ukraine is identified on the basis of changing trends in the investment sphere of the global financial market. It is substantiated that the potential of market development in Ukraine creates the basis for attracting investment capital in various areas of energy efficiency and helps our country to join global trends of greening the national economy in the context of the pandemic. It is proved that the green bond market can compete with investments in virtual assets and will have a long-term economic effect in the process of modernizing the national economy in the period of global climate change and COVID-19.
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Klymenko, Oksana, and Svitlana Mala. "“Green” bonds as a perspective instrument of attracting investments in ecological projects in Ukraine." University Economic Bulletin, no. 45 (May 27, 2020): 52–60. http://dx.doi.org/10.31470/2306-546x-2020-45-52-60.
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Relevance of research topic. The global economic trend is characterized by the “greening” of investment processes in order to ensure sustainable development. One of the instruments of attracting green investments in the economy is green bonds. In this regard, there is a need to create and operate a green bond market in Ukraine. Formulation of the problem. Ukraine has joined the global institutions promoting sustainable development and has declared the transition to a “green” economy, so analysis of foreign experience is needed to develop recommendations to a regulatory framework that will help solve the problem of attracting “green” investments in the Ukrainian economy. Analysis of recent research and publications. Among scientists and practitioners dealing with the problems of green investments, we should mention O. Veklic, Y. Podvisotsky, K. Markevich, M. Grityshina, A. Frolov. Selection of unexplored parts of the general problem. The issue of using green bonds to finance environmental projects in Ukraine remains poorly understood. Setting the task, the purpose of the study. The purpose of the study is to analyze the global trends in the green bond market and to develop recommendations for using this type of bond to finance environmental projects in Ukraine. Method or methodology for conducting research. The theoretical basis of the study is the dialectical method of cognition and a comprehensive approach to the study of economic processes in the financial sphere. The following special methods of research were used: historical and economic analysis; statistical and economic analysis; abstract-logical analysis; graphic methods. Presentation of the main material (results of work). The article reveals the positive dynamics of the global green bond market development, and determines that this type of investment is an important segment for Ukraine, which is a member of the world institutions for sustainable development. The state of the regulatory framework in Ukraine, which regulates the circulation of green bonds, is considered. The concept of introduction and development of the green bond market in Ukraine is recommended. The field of application of results. The results of the study can be used in the national financial system. Conclusions according to the article. Analysis of the global market for green bonds has led to the conclusion that this financial segment is characterized by a progressive and positive development. Green bonds have created a new way of attracting investors to green assets, the advantage of which is that investors are involved in the issue of these financial instruments, which put environmental responsibility first. Creating a market for green bonds in Ukraine will allow us to accumulate and direct financial flows for the development and financing of domestic green projects.
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Pawłowski, Maciej. "Diversification of the global green bond market." European Journal of Service Management 27 (2018): 331–37. http://dx.doi.org/10.18276/ejsm.2018.27/2-40.
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Baulkaran, Vishaal. "Stock market reaction to green bond issuance." Journal of Asset Management 20, no. 5 (January 10, 2019): 331–40. http://dx.doi.org/10.1057/s41260-018-00105-1.
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ŻAK, Katarzyna. "Green bonds as modern financial instruments." Scientific Papers of Silesian University of Technology. Organization and Management Series 2021, no. 154 (2021): 389–402. http://dx.doi.org/10.29119/1641-3466.2021.154.30.
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Purpose: The purpose of the paper is to present and analyse the development of green bonds issued on the Polish and international market in 2015-2021. Design/methodology/approach: The research methods used in the paper include the survey of Polish and foreign literature as well as the analysis of data from secondary sources. Desk research analysis was based on numerical data contained in the Climate Bonds Initiative database. Findings: The result of the conducted research is an indication of trends concerning the development of the green bond market and the main leaders on the international market. The position of Poland as an issuer of this type of securities is presented against this background. Research limitations/implications: The presented findings encourage further research to systematize data on green finance in Poland and the issue of green bonds from the point of view of the adopted criteria for their division. Practical implications: The analysis and assessment of the causes and effects of the issue of green bonds, especially on international markets, should be a kind of leverage to popularize this method of financing pro-ecological projects in Poland, especially among entrepreneurs and local governments. Social implications: The use of the presented data, analyses and conclusions should imply further actions and strategies of various entities necessary to implement the concept of sustainable development, especially green financing. The implementation of green bonds should result in the development of the capital market on the one hand, and on the other hand, contribute to the effective implementation of pro-ecological projects. Originality/value: The article synthetically presents the significance of the concept of green finance. It deals with current issues related to green bonds as well as global and domestic trends in their application.
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Agliardi, Elettra, and Rossella Agliardi. "Financing environmentally-sustainable projects with green bonds." Environment and Development Economics 24, no. 6 (March 5, 2019): 608–23. http://dx.doi.org/10.1017/s1355770x19000020.
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AbstractA structural model for green bonds is developed to explain the formation and dynamics of green bond prices and to address the issue of the so-called ‘greenium’, that is, the difference between the yields on a conventional bond and a green bond with the same characteristics. We provide answers to the following questions: What are the determinants of the green bond value? Do green bonds enhance the credit quality of the issuer? Are green bonds a relatively cheap tool to fund sustainable investments? We also study the effect of investors' environmental concern on portfolio allocation. Our results have direct policy implications and suggest that an improvement in credit quality could ultimately lead to a lower cost of capital for green bond issuers and that governmental tax-based incentives and an increase in investors' green awareness play a significant role in scaling up the green bonds market.
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Smirnov, Sergei D., and Andrei L. Bulgakov. "Are «green» bonds efficient in reducing cost of borrowings for company’s ecological projects?" Market economy problems, no. 4 (2021): 157–69. http://dx.doi.org/10.33051/2500-2325-2021-4-157-169.
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The subject/topic. The article addresses the issue of reducing cost of debt for ecological projects with green bonds. Goals/Objectives. The primary aim of this research is to reveal the interest rate discount «green» bonds have compared to conventional bonds. A decrease in cost of funding is a key element of «green» financial markets mechanism that improves investment quality of environmental projects. Methodology. The study uses statistical and regression analysis of more than 7,2 thousand bond primary placements for 2016-2020 years with total volume exceeding 6 trillion USD. Among them are 91 «green» bond issues with total volume of 84 bn USD. Cbonds and Bloomberg databases are primary sources of financial data for this study. The Results. Green bonds tend of have interest rate 0,3% lower compared to conventional bonds owing to sufficient demand from responsible investors. This result is the same for several different sub-samples of data that confirms its sustainability. Conclusions/Significance. The discount in interest rate that «green» bonds have allows reducing cost of funding for environmental projects making them more economically viable and attractive for companies. This mechanism persisting in global bond markets facilitates fulfillment of sustainable development goals (SDGs) defined by United Nations. Application. However, Russian bond market still doesn’t have this mechanism working properly since there are no responsible investors as a self-sufficient class.
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Wu, Xia, Danlu Bu, Jun Lian, and Yanping Bao. "Green Bond Issuance and Peer Firms’ Green Innovation." Sustainability 14, no. 24 (December 19, 2022): 17035. http://dx.doi.org/10.3390/su142417035.
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Based on the realistic background of the rapid development of China’s green bond market, this paper uses the data of China’s non-financial listed companies from 2010 to 2020 to examine the impact of green bond issuance on peer firms’ green innovation. The results show that the issuance of corporate green bonds can significantly promote the quantity and quality of peer firms’ green innovation, and this promotion effect is sustainable. The heterogeneity test shows that when the issuer of green bonds is an industry leader or the issuer is highly concerned by the media, the green innovation promotion effect of peer firms is more significant. Similarly, when the issuer and the peer firm are close competitors or in the same board network, the peer firm has a higher level of green innovation. It is further found that the green innovation behavior adopted by peer firms can significantly improve their environmental performance. The article indicates that the issuance of corporate green bonds can produce a good spillover effect of green innovation in the industry, which is conducive to China’s strategic goal of “carbon neutrality, carbon emission peak”.
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Doszhan, R. D., A. E. Sabidullina, A. Z. Nurmagambetova, and A. K. Kozhakhmetova. "Green financing in Kazakhstan: current state and prospects." Economics: the strategy and practice 17, no. 4 (December 31, 2022): 170–84. http://dx.doi.org/10.51176/1997-9967-2022-4-170-184.
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The purpose of this article is to assess the current state of green finance in Kazakhstan and build proposals for further development. The methodological basis of the scientific article was the general scientific methods of systematization of theoretical data, methods of scientific observation of economic processes, structural-logical and system analysis. Based on the study of the theoretical aspects of green financing and the analysis of structural programs and the legislative framework, the conceptual features of the Kazakh model of green financing were identified. The analysis tool was a statistical study of the financial market of Kazakhstan. A comparative analysis of the state of the green bond market was carried out on the basis of two parameters of the Climate Bond Initiative (CBI) database: the Green bond database of the Climate Bond Initiative (GBDB), the database of social bonds and sustainable development bonds (SSBD). The CBI statistical data formed on the basis of the study due to the fact that this organization determines the rating of green securities and makes a listing of issuers, and is also the main source of collecting and distributing information about green financial instruments on a global scale, especially about green bonds and certification. Statistical data were selected for 2021, as the issue of green securities in Kazakhstan began that year, and the country entered the world system as an accredited member and prospective partner of the global green bond market. The main result is the identification of current global trends in the development of green finance in Kazakhstan. Conclusions were drawn that the study and implementation of best practices in the field of green finance in the republic has been developed thanks to strong state support. The research proposed in the article can assist researchers in formulating research problems related to green finance.
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Khmyz, O. V. "International Experience of Green Bond Issue." Economics, taxes & law 12, no. 5 (October 31, 2019): 132–41. http://dx.doi.org/10.26794/1999-849x-2019-12-5-132-141.
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The subject of the research is current state and trends in a new segment of international finance market — the market of green bonds aiming at financing ecological projects.The purpose of the work is to assess the prospects of using green bonds through comparative analysis of their issuing actions taking into consideration the newest trends in world economy and finance developments. The importance of the article is predetermined by the novelty of the study subject, by the growth in number of issuing such bonds in both developed and developing countries due to the global trend of becoming more ecological, as well as by public support for ecologically pure projects. Moreover, green bonds allocation practices in different countries demonstrate their financial success attracting this way private investors to the sphere. The success is also supported by the process of specialization and certification. The author also emphasizes the trend of growing specialization in the field of international green bonds and confirms the prospects if its digitalization. The emission of green bonds should meet some specific requirements, such as verification conducted before their access to the market through an independent expertise by a third party. It is concluded that it is advisable to stimulate green bonds emission and circulation because of their viability on the world financial market.
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Frydrych, Sylwia. "Green bonds as an instrument for financing in Europe." Ekonomia i Prawo 20, no. 2 (June 30, 2021): 239–55. http://dx.doi.org/10.12775/eip.2021.014.
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Motivation: The interest in sustainable, socially, environmentally and climatically stable development of the economy is growing. At the same time, issuers and investors are looking for financial instruments with which they can achieve their investment goals. The idea of the green bond market is to develop debt instruments in financing projects contributing to ecologically sustainable development, which should have a direct impact on the development of technologies and practices in the area of resource use that contribute to limiting adverse climate change. Bonds for financing or refinancing renewable energy sources and increasing energy efficiency are seen as a natural part of the transformation of the global economy.
Aim: The purpose of the article is to present an analysis and goals of green bond market in Europe based on currency of issue, geographic structure, issue period, sectors and issue targets as well as major stock exchanges on which green bonds are listed.
Results: Relevant data on the green bond market in Europe was analyzed and the objectives of issuing green debt finance in particular sectors by number of emission were identified. It was verified that green bonds, which are listed only on one stock exchange, mainly the Scandinavian one, have a lower average value of the issue.
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Kodaneva, Svetlana. "Prospects for the development of the «green» bond market (Review)." Economic and social problems of Russia The digital economy Current state and prospects, no. 2 (2020): 102–14. http://dx.doi.org/10.31249/espr/2020.02.05.
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In the context of limited government budgets and the capacity of the banking sector, there is a need for new financial instruments to attract investment for the implementation of the Paris Agreement on Climate Change. One of such instruments is «green» bonds. The review analyzes the reasons for the growth of the «green» bond market in different countries and the prospects for its development.
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Prajapati, Dhaval, Dipen Paul, Sushant Malik, and Dharmesh K. Mishra. "Understanding the preference of individual retail investors on green bond in India: An empirical study." Investment Management and Financial Innovations 18, no. 1 (February 16, 2021): 177–89. http://dx.doi.org/10.21511/imfi.18(1).2021.15.
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The biggest challenge facing countries, including India, is creating and managing an LCR (low carbon resilient) economy, which balances the need for high growth rates and is environmentally sustainable. The green bond market provides investors the means to help change the economy into an LCR economy. The study was undertaken to understand the key drivers and the factors influencing the individual retail investor’s decision to invest in green bonds. A survey instrument was designed and administered through the snowball sampling technique to 125 Indian respondents of various age groups who were eligible to invest in the Indian bond market. SPSS software was used to conduct a descriptive analysis followed by regression and conjoint analyses. The study results suggest that the Environmental, Social, and Governance (ESG) rating and credit rating of the green bond issuers are the key factors that influence an individual’s investment decision. The findings also highlight that incentives such as tax exemptions and awareness of green bonds also affect an investor’s decision. This research stands out as one of the first attempts to understand the Indian retail investors’ perception of a green bond.
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Zhou and Cui. "Green Bonds, Corporate Performance, and Corporate Social Responsibility." Sustainability 11, no. 23 (December 3, 2019): 6881. http://dx.doi.org/10.3390/su11236881.
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Green bonds are a financial tool that has been vigorously promoted in the global green finance field in recent years. Since 2013, the global issuance of green bonds has seen explosive growth. China's green bond market has made great progress, rising to the top tier of global rankings. In this paper, Chinese listed companies that issue green bonds are used as the research object to explore the impact of green bond issuance on companies, including the impact of the announcement of green bond issuance on companies’ stock prices, as well as the impact of green bond issuance on companies’ financial performance and corporate social responsibility (CSR). The empirical results indicate that announcements of green bonds issuance have a positive impact not only on companies’ stock prices, companies' profitability, and operational performance, but also on innovation capacity, and can improve companies' CSR. Overall, the issuance of green bonds has a positive impact on companies, can contribute to environmental improvement, promotes CSR and value creation, and helps to attract investors to some extent.
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Saravade, Vasundhara, and Olaf Weber. "An Institutional Pressure and Adaptive Capacity Framework for Green Bonds: Insights from India’s Emerging Green Bond Market." World 1, no. 3 (November 19, 2020): 239–63. http://dx.doi.org/10.3390/world1030018.
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Although climate finance tools like green bonds have been gaining popularity in academia, the research has been limited to examining the financial viability and performance of this market. We explore a different research avenue related to institutional dynamics that are driving this market at the country level and shaping its adaptive capacity to climate change. Our paper introduces a new conceptual framework by linking institutional isomorphism with adaptive capacity dimensions in the green bond market. Using a mixed methods exploratory approach, we apply our institutional pressure-adaptive capacity framework to India’s green bond market. Our results show that different social actors, ranging from formal institutions like regulators and investors to informal ones like advocacy groups, can play a key role in shaping the legitimacy of this market. By highlighting ‘invisible’ social norms such as awareness about climate finance, changing regulatory priorities and the institutional strength of social actors, we contribute to the literature on this topic. We also introduce the concept of a high priority social actor and conclude that varying degrees of institutional pressure from such actors will ultimately decide the growth and legitimacy of this integral climate finance market at the country level as well as influence its adaptive capacity response to climate change.
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Bhurjee, Keerat, and Ankur Paliwal. "Determinants of Green Bond Performance Evidence From India." International Journal of Environmental Sustainability and Green Technologies 13, no. 1 (January 1, 2022): 1–18. http://dx.doi.org/10.4018/ijesgt.304821.
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Green Bond is a new concept in India that are described as debt securities issued to raise funds for financing green projects. This paper focuses on determinants that influence the performance of green bonds in India along with its comparison with conventional bonds. The analysis and literature exhibit that there are a lot of factors like price, risk, underwriters, etc. that may affect green bond performance and explains how, the issuance may be improved with the help of certifications, stock exchanges, and standardization. Finally, it is concluded that India has an immense potential to expand this gradually evolving market.
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Lippi, Andrea. "The Relationship Between Board Composition and the Ratings Given to Green Bonds: An Empirical Analysis." Journal of Management and Sustainability 11, no. 1 (March 28, 2021): 126. http://dx.doi.org/10.5539/jms.v11n1p126.
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Due to the growing number of green bond issues, a lack of mandatory standards and thus the growing phenomenon of greenwashing, an increasingly greater role is assumed by external auditors who are called upon to certify the ‘greenness’ of green bonds. These include rating agencies, which may be called on to express a green rating for each issue of green bonds. Based on a unique dataset made up of 66 green bond issues together with their respective green ratings from 2015 to 2020, the aim of this paper is to test the relationship between issuers’ board compositions and the green rating assigned to each bond issue. The results obtained confirm some conclusions already present in the existing literature and also open a new field of research concerning the green bond market, which has so far been little analysed, especially with reference to corporate governance.
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Dan, Anamaria, and Adriana Tiron-Tudor. "The Determinants of Green Bond Issuance in the European Union." Journal of Risk and Financial Management 14, no. 9 (September 16, 2021): 446. http://dx.doi.org/10.3390/jrfm14090446.
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Green bonds are a new financial tool that has developed rapidly in the context of climate change risks. Their proceeds are used to finance only environmentally friendly projects. This paper aims to examine the determinant factors of the green bonds issue in the context of the European Union countries. Using linear regression, we explore the impact of environmental, social, governance, and macroeconomic indicators on the level of green bond issues in the period 2014–2019. The results reveal that rating, ESG index; fiscal balance, inflation rate, and population have a significant impact and lead to a higher volume of green bond issuances. Our findings provide valuable insights into the development of the green bond market.
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Grahl, John, and Photis Lysandrou. "Germany's brake on European capital-market development." European Journal of Economics and Economic Policies: Intervention 15, no. 3 (November 2018): 364–81. http://dx.doi.org/10.4337/ejeep.2018.0034.
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In February 2015, the European Commission published a Green Paper in which it put forward the goal to ‘build a true single market for capital’ for all European Union member states by 2019. The present paper argues that there is no realistic prospect of achieving this goal given that the Green Paper omits any reference to a formidable impediment blocking a European capital-market union: the German government's stance on debt. The inescapable fact is that this government's reluctance to increase the supply of its bonds is depriving the European capital market of one of the essential ingredients necessary to its enlargement on the one hand and to the efficiency of its operation on the other: the former because capital-market enlargement crucially depends on attracting institutional investors who must hold a substantial proportion of their bond portfolios in the form of safe government bonds; the latter because the efficient functioning of the capital markets crucially depends on the efficiency of the money markets where safe government bonds are by far the most important form of collateral.
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Manasses, Gergely, Éva Paulik, and Attila Tapaszti. "Green Bond Impact Report as an Essential Next Step in Market Development." Financial and Economic Review 21, no. 4 (2022): 180–204. http://dx.doi.org/10.33893/fer.21.4.180.
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The measurement of the environmental impact of green bonds, its reliability and the publication of measurement results are crucial for the transparent functioning of the market and supporting investor decisions. However, this segment of the financial markets is still at an early stage of maturity, and the lack of adequate data and methodologies is a common problem that can only be solved by the development of single-market best practices and regulations. The essay reviews the trends, characteristics and current regulation of existing green bond impact reports and describes the challenges of evaluating impact reports, based on the literature and our own practical experience. In our view, the market has already moved past its “virtue-signalling PR” stage, but there is still a long way to go before impact data become as standardised as traditional financial data.
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Rehman, Mobeen Ur, Ibrahim D. Raheem, Rami Zeitun, Xuan Vinh Vo, and Nasir Ahmad. "Do oil shocks affect the green bond market?" Energy Economics 117 (January 2023): 106429. http://dx.doi.org/10.1016/j.eneco.2022.106429.
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