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, 2020, 13, 61; Doi:10.3390/jrfm13030061

26 Pages Posted: 27 Apr 2020

See all articles by Pauline Deschryver

Pauline Deschryver

Columbia University - School of International & Public Affairs (SIPA)

Frederic de Mariz

Columbia University; Institut d'Etudes Politiques de Paris (Sciences Po)

Date Written: March 24, 2020

Abstract

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.

Keywords: green bonds; sustainable investing; ESG; impact measurement; socially responsible banking

Suggested Citation

Deschryver, Pauline and de Mariz, Frederic, What Future for the Green Bond Market? How Can Policymakers, Companies, and Investors Unlock the Potential of the Green Bond Market? (March 24, 2020). Journal of Risk and Financial Management, 2020, 13, 61; Doi:10.3390/jrfm13030061, Available at SSRN: https://ssrn.com/abstract=3565933

Pauline Deschryver

Columbia University - School of International & Public Affairs (SIPA) ( email )

420 West 118th Street
New York, NY 10027
United States

Frederic De Mariz (Contact Author)

Columbia University ( email )

3022 Broadway
New York, NY 10027
United States

Institut d'Etudes Politiques de Paris (Sciences Po) ( email )

27 rue Saint-Guillaume
Paris Cedex 07, 75337
France

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