Posted on December, 02 2016

The European Commission aims to standardise definitions and requirements for so-called ‘green bonds’ across the EU, an initiative aiming at shifting private capital to sustainable projects. This move is strongly welcomed by WWF, who has called for collective action to develop effective and credible standards for the green bond market.

A study, published today by the European Commission, recommends regulatory measures towards a common European standard for Green Bonds,  building on existing market-led initiatives¹.

Jochen Krimphoff, WWF technical lead on green bonds, said:

“We welcome this new analysis by the EC, which confirms our own findings². Credible, fully-developed and widely-accepted industry standards for green bonds are urgently needed to ensure that the market thrives and benefits the sustainable economy. Only a bond for which the issuer can demonstrate measurable environmental benefits, certified by an independent party according to effective and credible standards, should qualify as a green bond.”

Sebastien Godinot, Economist at WWF European Policy Office, said:

"We need to inject a stronger element of trust in the green bonds market. Investors across the EU must have the assurance that if they chose the green option, this choice is meaningful from an environmental perspective. Without this investor confidence, green bonds will fall short of their potential to drive the green economy."

“The European Commission’s report should lead to concrete action in the mid-term review of the Capital Markets Union in 2017. The EU’s High-Level Expert Group on Sustainable Finance must now lay out a detailed policy roadmap that should include standardised terms and definitions, standardised disclosures, certifications and credit-rating requirements, as well as credible dispute resolution mechanisms at international level.”

“Well-designed supportive public policies at EU level can significantly accelerate the development of the green bond market. Moreover, the German Presidency of the G20 also provides a unique opportunity to ensure consistency and comparability of green bond standards, terms and definitions at international level, so as to avoid unnecessary fragmentation of the global green bond market.”

ENDS

Notes to the editor:

1. Study on the potential of green bond finance for resource-efficient investments
2. WWF recent report on green bonds, published in June 2016, calls for collective action to support the development of the ‘next generation’ of effective and credible standards for the green bond market. The WWF report ‘Green bonds must keep the green promise!’ is available in English.

Contact:

Audrey Gueudet
Climate & Energy Senior Media and Communication Officer
WWF European Policy Office
agueudet@wwf.eu
Mobile: + 32 494 03 20 27