The environmental efficiency of green bonds: obstacles and perspectives

Abstract

Research has shown massive investments are necessary to finance an adequate response to climate change and the transition to a low-carbon economy. Several sustainable finance instruments have emerged over the past few years, green bonds being the most prominent one.

However despite green bonds’ popularity questions regarding their environmental efficiency (the ability to increase the positive impact on the environment in a systematic way) arise. Indeed key issues around the lack of standardization, greenwashing, the large share of refinancing etc. questioning whether green bonds are capable of having a positive impact on the environment.

After describing the concept of green bonds, its ecosystem and its different stakeholders, this master thesis entitled “The environmental efficiency of green bonds: obstacles and perspectives” analyses the challenges of the green bond market present in the literature and then compares them to the opinion of key market stakeholders through interviews with professionals linked to the topic. The aim is to compare the theoretical and practical aspects in order to formulate recommendations to increase green bonds environmental efficiency.