Looking at the impact of climate change on our environment, green bonds have been designated for this very purpose. The money via these bonds is kept solely for investing in projects governing climate and environmental issues. Since 2007, green bonds have been present in the market and big entities such as the World Bank brought them into existence.
These green bonds did stumble in the beginning but as of 2019, green bonds have resulted in a total of 258 billion dollars globally. That's a huge win since, in 2018, it was 51% lesser. There are multiple choices in green bonds which include loans and personal placements too.
The green loans are used for financing and investment in environmental projects. These personal placements are made when green bonds are bought by private investors. These green bonds and its variances are contributing to environmental, social and governance (ESG) investments as well. You can further explore the relationship between ESG investing and green bonds with the help of the following infographic.
Infographic by: Raconteur
