‘The green bonds market spreads its wings across the globe’, ‘Explosive growth!’, ‘Green bonds enter the game as star players!’ – that’s how some of the journalists described the exciting growth of the green bonds market in 2014. After the impressive year, everyone wonders if ‘the breakneck speed of expansion’ will continue.
There was a lot of media interest around the Australian first Climate Bond Certified bond from the National Australia Bank (NAB) and the first-ever public green bonds list.
Institutional Investor, How to use fixed income to fuel green bonds growth, by Ulf Erlandsson (AP4) and Sean Kidney (Climate Bonds Initiative)
The article looks at ways of harnessing the huge power of the bonds market into investments dedicated to growing a low-carbon economy. The authors argue for incorporating green bonds into mainstream portfolios rather than setting up dedicated green bonds funds.
Institutional Investor, Index rush pushes green bonds towards the mainstream, by Katie Gilbert
While looking at the outstanding growth of green bonds in 2014, the author gives special prominence to the launch of the three big green bond indices.
In any future account of the rise of the green bond market, the second half of 2014 will deserve special note. During this period three major financial institutions have launched indeces devoted to green bonds, which governments and corporations issue to pay for alternative-energy infrastructure, public transport and other projects that combat climate change.
Institutional Investor, Setting Standards for transparency in green bonds, by Carol J. Clouse
Looks at the growing demand for the clear definitions in the green bonds market, including the views of investors from Aviva Investors and CalSTRS.
‘When you get into the corporate space, you’re dealing with a large number of companies, and transparency is not always good. (…) If they’re calling it a green bond, and it’s a self-determination that they’re making, we wouldn’t necessarily treat that as a green bond. I think we’d take that with a pinch of salt’ says Colin Purdie, head of global investment-grade credit at Aviva Investors.
Business News Network's (BNN) Commodities, Climate bonds are growing breed
Andrew Bell interviews Climate Bonds Initiative CEO Sean Kidney about the sudden surge in the green labelled bonds and the potential for Canada.
Reuters, Green bonds sell big in 2014 as finance bids to help climate, by Ross Kerber and Hilary Russ
A careful look at green bonds growth by Reuters journalists. The key question posed is whether green bonds bring additionally to the market: do they send new money to climate-smart projects or are they just a marketing gimmick?
Participants say that to avoid the impression that green bonds are just a marketing ploy, they still need to show more corporate treasurers and investors the bonds can make it easier to fund projects, a corner they have not yet turned.
"If people think this is just to raise the flag, it's not going to last long," said Christopher Flensborg, Head of Sustainable Products and Product Development for Skandinaviska Enskilda Banken AB.
Business Green, Report from Beijing: Three steps to grow the green bonds market in China, by Sean Kidney, Climate Bonds Initiative
Kidney proposes three key steps to develop a robust green bonds market in China. He sees a potential for the country to take a position of a global leader in the face of the enormous environmental challenges.
In China, green bonds can fund the wide range of green urbanization and green infrastructure projects that are required on the ground. China's amazing, already established, high-speed rail network marked the start of that new green infrastructure story. Now we're seeing massive growth of clean energy. Next must be Green Cities, clean water, and agriculture.
Environmental Finance, A review of the green bond market in 2014, by Peter Cripps
Environmental Finance looks at the top performing green bonds underwriters of 2014 – with SEB closely followed by Crédit Agricole and BAML, the year-end league table looks like a close-run contest.
<<Check out the final 2014 league table released last week>>
As the green bond market spreads its wings across the globe, there are questions over whether Swedish bank SEB can hang onto its crown. In the third quarter of 2014, for example, it was knocked off the top spot by Crédit Agricole.
Eco-business, Growth of green bonds poses challenges for investors, regulators, by Stephen Minas
Stephen Minas outlines the much talked-about ‘green bonds dilemma’; lack of standards creates the risk of greenwash and a more rigorous definition comes at the expense of scale.
Concerns about ‘green washing’ could grow if mainstream investors increase as a proportion of subscribers. The Climate Bonds Initiative estimated 2013 demand for green bonds from subscribers with a ‘sustainability mandate’ at between 58 per cent and 80 per cent, meaning that mainstream investors already made up a significant portion of the market. Non-specialist investors could find themselves poorly placed to assess how ‘green’ a bond is, especially if confronted with competing voluntary standards.
The Globe and Mail, Green bond market is ‘exploding,’ but limited to individual investors, by Richard Blackwell
Author of the article is concerned with the limited availability of green bonds for individual investors in Canada.
In Canada, there have been a handful of large green bond issues (…). But all these were snapped up by big institutions – such as pension funds – who wanted green bonds for their portfolios. A very small proportion trades in secondary markets, where individual investors may buy them.
CFA Institute - Climate Bonds: More Than Hot Air, by Charlie Henneman
Charlie Henneman summarises Sean Kidney’s presentation at the 2014 Fixed-Income Management Conference.
“No one takes a haircut on sentiment,” Kidney explained — a commitment to a less carbon-intensive economy does not replace fiduciary duty. The standards of investment practice related to investment terms, credit analysis, and the appropriateness of the instrument still apply in the case of climate bonds.
ChinaDialogue, Growing business commitment to low carbon growth is a bright spot at UN talks in Lima, by Isabel Hilton
A commentary on the Lima UN Climate Conference talks; in the face of long standing climate-deal disagreements between developed and developing countries, the author wonders where the much-needed money could come from.
Several speakers in Lima this week have identified potential for green bonds to finance climate friendly infrastructure. Sean Kidney, CEO and founder of the Climate Bonds Initiative, told delegates that bonds could supply the US$53 trillion in capital required before 2050 for the long-term environmental infrastructure needed to build a low-carbon, climate-resilient economy.
Using bonds in this way, he said, would deliver savings of US$115 trillion in fossil fuel inputs and set the world on a low carbon pathway.
Ensia, Here’s a way to pay for a healthier planet, by Anne Field
Anne Field outlines the story of green bonds and provides examples of projects that could be financed with this financial instrument.
“The focus is on allowing us to transition to a low-carbon economy — and to do it quickly,” says Sean Kidney, CEO and co-founder of the Climate Bonds Initiative, a London-based nonprofit.
“Tapping a long-established financing mechanism — bonds — is a way to boost the chances investors, from pension funds to asset managers, will get involved.”
Surety Solutions, Expert Interview with Sean Kidney on Green Bonds
In an interview with Surety Solutions, Sean Kidney covers the green bonds basics.
“A Green bond is a simple proposition that will appeal to both investors that are concerned with climate change and also to those who simply couldn't care less. There’s usually no difference in the credit rating between a green bond and vanilla bond from the same issuer. This means that investment managers do not have to take a hit on price.”
Green Bonds list launch
At the beginning of December, we made the full list of labelled green bonds publically available for the first time. Apart from basic bond reference data, ‘second party opinion’ information has been embedded into the list – a step to boost transparency in the market. Here is what the media were saying.
Business Green, Climate Bonds Initiative lifts lid on green bond market, Jessica Shankleman
Environmental Finance, Most green bonds include second opinion, according to CBI data, Sophie Robinson-Tillett
The Fifth Estate, Public list of green bonds launched
Benzinga, First Of Its Kind: Green Bonds' Data Goes Public, Javier Hasse
Climate Wire, First-ever 'green' bond database aims to boost transparency, Benjamin Hulac
Ethical Markets, First-ever public green bonds data list launched by the Climate Bonds Initiative
Responsible Investor, Climate Bonds Initiative publishes full listing of green bonds
2nd release of the Investor Statement re. Green Bonds & Climate Bonds.
The investors’ commitments first released at the September UN Climate Summit, have been rereleased in December with five new joiners. Signatories have combined assets under management of $2.24 trillion.
Investment & Pensions Europe - AP funds back call for 'ambitious' framework to grow climate bond market, Jonathan Williams
Financial News - Buyside quintet joins green bond backers, Andrew Pearce
Environmental Finance - More investors join campaign to boost green bond market, Graham Cooper
Business Green - Investors call on governments to fire up green bond market, Will Nichols
HydroWorld - US$2.24 trillion for green bonds coincide with standards for marine hydrokinetic risk management, Gregory B. Poindexter
The Sustainability Report - Five investors join initiative to grow green bond market, Rachel Alembakis
InvestorIdeas.com - $2.24 trillion of investors commit to grow the green bonds market and call on governments to urgently deliver projects to be financed
NAB Climate Bond
National Australia Bank (NAB) Climate Bonds Standard certified green bond hit the Australian investors’ desks in December. It sold in 5 hours and doubled in size due to huge investor demand!
Bloomberg, National Australia Bank Plans First Green Bond by Aussie Lender, Benjamin Purvis
ABC News, NAB launches first Australian climate bond, Stephen Letts
Global Capital, NAB goes green with climate bond, Graham Bippart
Environmental Finance, NAB to launch renewable energy bond for Australia, Sophie Robinson-Tillett
Financial Review - NAB ‘climate bonds’ draw double expected demand
Financial Standard, NAB launches Australia's first certified climate bond
IFR Asia, NAB readies debut seven-year Australian dollar green bond, John Weavers
Kanga News, NAB prints A$300 million in Australia’s first domestic green bond deal
Sourceable, Australia Launches its First Certified Green Bonds, Gordon Lane
Environmental Finance, NAB doubles green bond for Australian renewable energy, Sophie Robinson-Tillett
The Fifth Estate, NAB launches first Aussie Green Bond – we’re in the money now, Tina Perinotto
RenewablesSeeNews , Australia's NAB issues green bond to fund over 1.5 GW of renewables, Ivan Shumkov
The Fifth Estate, NAB climate bond doubles in five hours, Tina Perinotto
Renew Economy, NAB joins green bond market with $150 certified climate bond – Australia’s first, Sophie Vorrath
Architecture & Design, Australia’s first Climate Bond by NAB will fund 17 wind and solar energy farms, Nathan Johnson
Professional Planner, Australian Ethical Investment announces investment in climate bond
The Sustainability Report, Australian Ethical invests in NAB climate bond, Rachel Alembakis
EcoGeneration, National Australia Bank has launched Australia’s first climate bond
Canadian ‘Bonds & Climate Change’ report
In December, in association with the Sustainable Prosperity, we have released a Canadian edition of the ‘Bonds & Climate Change. The State of the Market 2014’ report. It showed that Canadian climate themed universe grew by 78% in 2014!
BNN Business Day PM, Green bond market takes off
Alex Wood, Senior Director at Sustainable Prosperity joined the Business News Network for a look at the growth of green bonds in Canada.
Toronto Star, The growth of green bonds, Alex Wood
After sitting on the capital market sidelines for nearly three years, Canadian-issued green bonds entered the game as star players in 2014. In fact, they pulled in $1.2 billion (U.S.) from investors by October, compared to nothing in 2013.
The Globe & Mail, Canada takes big step in growing green bonds market, Richard Blackwell
Green bonds – which raise money for projects that help mitigate climate change – have grown from a niche market to a substantial portion of the fixed income market, a new report says. And Canada is emerging as a significant player in that market, thanks to three large green bond issues in 2014.
SeeNews.Renewables, Clean energy in Canada backed by CAD 19.5bn of green bonds, Tsvetomira Tsanova
