Beijing: Climate Bonds/Bank of China present research on scaling green capital flows to UK-China Green Finance Taskforce. Addressing low carbon transition - a key part of China & UK shared vision for promoting sustainable development


The global green bond markets are booming, but the capital mobilized to date is far from enough to finance the worldwide transition to low-carbon economy.

At yesterday’s China-UK Green Finance Forum in Beijing, Climate Bonds and Bank of China have shared its recommendations on scaling up green capital flow, highlighting the importance of connecting international green bond markets with China.  

Developing terms of green definitions, information flows, market infrastructure and market access all set the platform for the next phase of growth.


Background to the Green Finance Taskforce

China and the UK have been progressively increasing their cooperation around green finance at G20, ministerial and financial levels.

The China-UK Green Finance Collaboration Taskforce, established by Green Finance Committee of China Society for Finance and Banking and the City of London’s Green Finance Initiative, is tasked with increasing financial cooperation between the two nations and growing green investment and opportunities.

Five Workstreams have been established to examine best practice and policy options around five main aspects:

  • Assessing environmental risk,
  • Green asset backed securities,
  • Analyzing funding costs via ESG risks and assessments,
  • Greening the Belt and Road, and 
  • Scaling-up green capital flows.


Climate Bonds Initiative and Bank of China co-chair the "Scaling-up green capital flows" Workstream. Other workstream co-chairs include Central University of Finance and Economics International Institute of Green Finance, UNPRI, China Industrial Bank, Bank of England, ICBC, HSBC, Renmin University of China Research Center of Ecological Finance and City of London.

Yesterday’s Beijing Forum was convened to review the main research achievements of the Task Force Workstreams and also discuss future collaboration, as a part of the 9th China-UK Economic and Financial Dialogue. 

The UK-China Green Finance Task Force interim report Globalising Green Finance: Turning Green Momentum into Actions was released at the Forum.


What’s our view on scaling up?

Climate Bonds and Bank of China put forward a series of interim recommendations at the Forum.

In the section titled “Facilitating International Capital Flows to Grow China’s Green Bond Market” in the interim report, produced by the Climate Bonds Initiative in collaboration with Bank of China, the following challenges faced with domestic issuers and international investors:


Challenges to Green Bond Issuance from China:

- Lack of awareness among potential green bond issuers

- Capital costs for Chinese issuers may not be as low as expected

- Approval process and quota limitation


Challenges for international investors participating in the onshore green bond market:

- Differences between China’s green definitions and internationally accepted green definitions

- Lack of information on China’s green bond market

- Controlled domestic market access

- Capital flow controls

- Inadequate hedging tools

- Unfamiliar with domestic credit ratings


Nine Core Recommendations:

- Raising Chinese issuers’ awareness through market education activities and demonstration issuance

- Improving international investors’ understanding of China’s green bond market through investor roadshows and engagement platforms

- Developing green bond database and indices

- Establishing and using internationally accepted green bond standards and certification scheme

- Simplifying approval process

- Providing clearer policy guidance on market entering schemes

- Providing clear policy signal and guidance to reduce investor perception on capital controls

- Developing RMB hedging instruments

- Improving domestic credit ratings practice


Who’s saying what?

Co-chairs and guests also exchanged views on future green finance collaboration leading up to the 9th China-UK Economic and Financial Dialogue scheduled for later this year:

Chen Yulu, Deputy Governor of People’s Bank of China, emphasized that the development of green finance in China is still at an early stage, more effort should be put into improving product yield and maturity mismatch, promoting cross border capital flow, and bringing together think tanks to work towards these goals. Multinational as well as bilateral framework such as the China-UK Green Finance Taskforce play an important role.

Speaking on prevention of environmental risks translate into financial risks, Ma Jun, Chief Economist of the PBoC Research Bureau and Chair of Green Finance Committee of China Society for Finance and Banking, suggested that the market can look into developing a stress test design akin to bank stress tests, setting threshold of carbon price level or sea water level as adverse scenario.


Climate Bonds CEO Sean Kidney noted that, apart from working on reduction of the friction between different green bond definitions, encouraging better use of proceeds disclosure and compliance with the best practice of external review would be positive developments. 

Chinese regulators may also foster green bond market growth by giving preferential treatment such as  green windows to international investors, a fast track to facilitate approval process of investment funds and a Green Bond Connect scheme to be built on the basis of China-Hong Kong Bond Connect.


Martyn Roper, Minister and Deputy Head of Mission, British Embassy in Beijing, commented that more work need to be done on mainstreaming green investment and making it more commercially attractive.

This might require investors taking more proactive ESG strategy and industries improving their information disclosure.


From a broader perspective, Sir Roger Gifford, Chairman of City of London Green Finance Initiative, stressed that finance without going green is meaningless, only financial activities in support of green development are truly finance.


What’s Next?

The final Climate Bonds/Bank of China report will be published at the 2017 UK-China Economic and Financial Dialogue to be held later this year.

We’ll keep you posted.


'Till next time,

Climate Bonds










中英两国一直致力于加强在绿色金融领域的合作,包括在二十国集团、政府部门以及金融部门层面。 中英绿色金融工作组由中国金融学会绿色金融专业委员会和伦敦金融绿色金融倡议组织组建,旨在促进中英两国推进绿色金融合作,增加绿色投资机会。


- 环境压力测试


- ESG评估




































气候债券倡议组织首席执行官 Sean Kidney提出,除了降低不同绿色债券定义之间的差别给市场发展带来的阻力,鼓励完善募集资金用途的信息披露,促进外部审查方面的最佳实践,中国监管机构还可以通过给投资者提供便利措施的方式促进绿色债券市场的发展,如建立投资基金申请进入市场的快速通道,在内地-香港债券通机制下建立绿色债券通等


伦敦金融城绿色金融倡议组织的主席 Roger Gifford 爵士强调不是“绿色”的金融是没有意义的,只有支持绿色发展的金融活动才是真正的金融。






免责声明: 本文所提供的信息不构成任何投资建议,气候债券倡议组织并不是投资顾问。气候债券倡议组织并没未提供任何关于投资优缺点的建议。投资决定完全取决于投资者自身。气候债券倡议组织对任何个人或机构的任何投资以及代表任何个人或机构的第三方机构的任何投资概不负责。




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