Pure green

19 August 2019 By Swaha Pattanaik Follow @swahapattanaik

Companies that pollute can sell debt with an eco-friendly tag if they ringfence the money for climate-conscious projects. Critics call this “greenwashing”. But the extra transparency asked of borrowers is useful. So is an injection of ethical thinking into corporate treasuries.

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Global green bond issuance reached $86.4 billion in the first half of 2019, up 26% from a year earlier, according to Refinitiv data. Issuance of such debt hit a record high of $132.3 billion in 2018.

The Netherlands on May 21 said it had received 21.2 billion euros worth of orders for its inaugural green bond. The triple-A rated sovereign sold almost 6 billion euros of such debt and explicitly prioritised investors with green credentials by offering them a more favourable allocation.

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