The EU commission has published a study on green bonds which looked at the extending the accounting and disclosure requirements of green bonds to other non-green bonds as one way to harmonize green bonds frameworks across the European Union.
The study titled Study on the potential of green bond finance for resource-efficient investments, provided an overview of the major obstacles to the development of green bond market across countries and sectors and proposes some solutions and policy recommendations to these.
Amongst the potential measures to improve the landscape for green bonds the study looks at mandatory disclosure of green indicators for bond issuances and investments and highlights the need for standardisation in order to ensure that the proceeds from green bonds are used for genuinely green projects with measurable environment objectives.
The study looks at various ways to harmonise green bonds framework in the EU, including extending the accounting and disclosure requirements of green bonds to other non-green bonds.
“This would a) allow investors to see the environmental impact of their investments, b) allow the market to price in environmental benefits (or dis-benefits) and c) help ensure that the opportunities to improve environmental impact are maximized,” the study read. “It could also be considered to require disclosure of green indicators regarding bond issuances and investments i.e. what share of an issuance or investment portfolio is green. This would allow keeping track of market development and good-practice players.”
Link: Study on the potential of green bond finance for resource-efficient investments
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By GlobalData