Premier US environment NGO joins Climate Bonds Standards project

Speaking at a State Street Global Advisors Green Bonds Summit in Boston, Climate Bonds Initiative Chair Sean Kidney announced that the Natural Resources Defence Council (NRDC) had joined the Governing Authority of the Climate Bonds Certification and Standards Scheme.

The Standards Scheme will help spur the growth of the global green bonds market by giving investors and governments an easy way to assess the integrity of environmental claims.

Mr Kidney said: "According to the International Energy Agency we need at least a trillion dollars a year to be flowing into low-carbon industries if we're to avert catastrophic climate change. That money will come largely from bond markets. We need to ensure it's invested properly."

The Natural Resources Defense Council is one of the USA's most effective environmental action organizations. NRDC uses law, science and the support of 1.3 million members and online activists to protect the planet's wildlife and wild places and to ensure a safe and healthy environment for all living things. Peter Malik, Director of NRDC's Center for Market Innovation said, "Establishing credible and transparent standards for climate bonds will help channel private capital to disarm the world's toughest ecological changes."

Mr Kidney: "Standards will provide a multi-country tool for investors and governments to assess the integrity of green investments and to preference them. It will support liquidity with green portfolios, essential for investors today."

Growing this "green debt" market will provide institutional investors with opportunities to switch from carbon intensive to low-carbon investments - and fuel the growth of the low-carbon economy.

Funds under management by global bond traders reached $83 trillion in 2008. Globally, between $2-4 trillion of new bonds are issued each year.

Theoretically, climate change-related bonds could be issued each year up to a level of $0.5 trillion for 20 years and still not exhaust the capacity of the global market.

"NRDC will be one of a group of institutional investors and NGOs that make up the Governing Authority. The first standard will be released for discussion within weeks."