Green Bonds: An Assessment of the Proposed EU Green Bond Standard and Its Potential to Prevent Greenwashing

Abstract

This study analyses the Commission proposal for a Regulation on European green bonds. It compares the proposal with existing EU legislation on sustainable finance and financial regulation and contextualises it in the EU green bond market. The assessment covers key regulatory aims, advantages of voluntary and mandatory options, different types of sustainable bonds, alignment with the Taxonomy Regulation, corporate and sovereign bonds, transparency requirements, review and supervision, enforcement and sanctions, and international aspects. On each aspect it provides policy recommendations to the co-legislators.

This document was provided by the Policy Department for Economic, Scientific and Quality of Life Policies at the request of the committee on Economic and Monetary Affairs (ECON).

https://www.europarl.europa.eu/RegData/etudes/STUD/2022/703359/IPOL_STU(2022)703359_EN.pdf

Keywords: climate change, green bonds, use of proceeds, disclosure, transparency, external review, conflict of interest, financial supervision, civil liability, Regulation on European green bonds, Taxonomy Regulation, Sustainable Finance Disclosure Regulation, Corporate Sustainablility Reporting Directive

JEL Classification: K20, K22, K23, K32, K33, K42