Responsible investing extends beyond a green label
A green bond is a debt security that has been verified to be backing assets, or projects, that have positive environmental or climate change benefits.
Green bonds can bring societal benefits by facilitating funding for projects with positive environmental impacts. Just as credit ratings indicate the likelihood of a bond defaulting, the green label can help sustainability-minded investors with limited resources to identify securities that adhere to their values.
On its website, Climate Bonds Initiative, one of the two green bond certification agencies, cites the following benefits of green bonds (Harbour’s emphasis added):
- Highlights their green assets/business
- Positive marketing story
- Diversify their investor base (as they can now attract ESG/RI specialist investors)
- Joins up internal teams in order to do the investor roadshow (environmental team with investor relations and other business)
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