State of the Climate Bonds Market 2014

Asset Pools : Bonds

Bonds are the largest single asset class in the financial system, currently valued at about US$100 trillion. They are an important means of raising long-term debt, particularly for assets with relatively predictable risks and returns. There are two interlinked public policy priorities for bonds:
  • Enable the growth of green bonds: Green bond markets are growing, however they require credible and ultimately verifiable standards to ensure market integrity. Other measures include developing the pipeline of green bonds, aggregating and sececuritising smaller projects and improving returns through tax credits and incentives.
  • Greening of bond markets: Mainstream bond markets should integrate environmental, social and governance factors into routine credit ratings.

Inquiry Publications

  • Aligning the Financial System with Sustainable Development in the United States of America

    Date: 01-Feb-2016

    The US financial system is undoubtedly among the largest, most innovative and most sophisticated in the world. It is also clear that this is both a benefit and an impediment to non-governmental investment in sustainability and inclusiveness. To date, the actual investment in infrastructure and sustainability does not meet current needs, especially those related to maintaining

  • China Green Finance Task Force Report: Green Bonds

    Date: 02-Apr-2015

    Green bonds provide a potential source of long-term funding for green loans which reduces the risk of maturity mismatch. This paper recommends that China should commence the pilot issuance of green bonds at the earliest possible date to support the green lending business of banks. Specific recommendations are: Create a clear standard to define the scope of investment

  • Scaling up Green Bond Market for Sustainable Development

    Date: 09-Dec-2015

    This guide argues that with the right support in place USD 1 trillion of green bonds could be issued a year by 2020 – providing a significant contribution to closing the investment gap for climate-friendly infrastructure in both developed economies and emerging markets. It argues for several sets of policy actions to support and enable the green

  • A Review of International Financial Standards as They Relate to Sustainable Development

    Date: 22-Feb-2017

    The report, a companion to the second edition of “The Financial System We Need”, examines how the international financial standards currently relate to the goals of sustainable development and explores opportunities for better alignment as a way to promote greater stability, resilience and fairness to the financial system. The key messages are: Financial standards have

  • China Green Finance Task Force Report: Mandatory Disclosure

    Date: 02-Apr-2015

    This paper makes the case that compulsory disclosure of environmental information by listed companies and bond issuers is an effective measure to increase the sense of corporate social responsibility, improve corporate environmental performance, incentivize investors to refrain from polluting investments and strengthening green investments. It recommends: CSRC and stock exchanges formulate rules on compulsory environmental

  • Sustainable Infrastructure and Finance

    Date: 13-Jun-2016

    Infrastructure is often referred to as the backbone of the global economy and plays a fundamental role in societies by enhancing the quality of life and increasing productivity. In addition to its effects on society and the economy, infrastructure can have significant impacts on the environment, depending on the choice of infrastructure. Approximately 75% of

  • China Report: Greening China’s Bond Market

    Date: 06-Oct-2015

    This reports rovides an overview of the green bonds theme, innovative structures in the international market and potential application in China. A key message is that green finance, in addition to providing a green benefit, can assist in implementing and enforcing financial reforms that address imbalances in China’s financial system. Another message is that providing

  • India Country Report

    Date: 29-Apr-2016

    An India Advisory Council of the UNEP India Inquiry was convened by the Federation of Indian Chambers of Commerce and Industry (FICCI). This report highlights key proposals emerging from their discussions for aligning the Indian financial system with sustainability. In the Indian context, they call for development of a more robust and resilient ‘sustainability-oriented market framework’ focused

  • Indonesia Country Report

    Date: 30-Apr-2015

    Placing Indonesia’s economy onto a green and sustainable development pathway, as envisaged in the National Long Term Development Plan, will require a large mobilization of investment. Estimates of the annual investment needed are in the order of US$300‐530 billion, with a large portion of this investment needed in critical infrastructure, as well as environmentally sensitive

  • 3rd Update Report: Pathways to Scale

    Date: 07-Jan-2015

    This is the 3rd Update Report of the UNEP Inquiry, it is focused on the challenge of financing the low-carbon transition. It explores how innovative ideas and practices can be made more effective, adopted more widely, and taken to scale—and as a result move the trillions that are required. Scaling-up proven but limited innovations, is a common

Further Readings

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