Green Bonds to foster the economic growth

Green Bonds are financial instruments to foster the economic growth globally, but how the markets are really working? Last year was a record year for the over 100 billion dollars green bonds markets and for this year 2018 the expectations are about 130 billion dollars according to Climate Bond Initiative.

EU made a study of this market a year ago. The study identified key bottlenecks that hampered the further growth of the green bond market in the EU area. The biggest challenge is the lack of green bonds and green project pipelines.

The findings show that Green Bonds would be a great instrument to lead the climate mitigation and to fulfill the Paris Climate Agreement. The growth of these instruments have been mainly in China so far, but also big, listed companies and institutional investors have issued this kind of bonds.

The study also highlighted the measures of policy makers to develop the markets further- to raise the awareness on the benefits of green bonds, and thus increase supply support capacity building and knowledge sharing.

According to EarthRate, an ESG company, green bonds are new financial tools that require more climate-related information and targets from companies but at the same time they give the possibility to enlarge the investor base of a company towards more long-term base.

According to Financial Times (2.1.2018) the annual investment need for Europe, to keep the temperature rise below 2 degree Celcius, is 180 billion euros. The EU Commission is also planning to ease the capital rules for the banks in order to boost their green investments. This should be part of the new sustainable finance action plan, which should be released in March 2018.

Green Bonds are modern way of acting in the financial markets. But they also foster the underlying economic growth for further climate friendly investments.

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Finance

SouthPole: 10 years of climate change projects

 

The Swiss global sustainability solutions provider, South Pole Group, is celebrating its 10 years anniversary this year. According to Dr. Maximilian Horster, a partner of South Pole, the past decade the company has grown to more than 150 employees in 17 different offices globally.

– We are a pioneer in the field of climate impact assessment of investments. Most of our projects are in the financial sector. About 50 / 50 percent we work with public and private companies. Our competitive edge is in the combination of different players and climate change specialists, Mr Horster says.

He predicts that the Paris climate meeting in last December was the first step into more integrated energy thinking globally.

– Our politicans have now realised that countries need more holistic views of climate change actions and mitigation. Carbon pricing and tariffs are examples of actions that need more focus in our political debate in order that the countries can swift to more renewables and zeroemissions targets, he adds.

The company has recently won multiple categories in the 2016 Environmental Finance Voluntary Carbon Market Rankings: the prestigious peervoted industry ranking recognised South Pole Group as Best Trading Company, Best Project Developer – Renewable Energy and Best Wholesaler.

EarthRate, an ESG innovator company, and SouthPole offer indepth carbon footprint analyses for investors and companies.

 

 

 

 

Business Finance

The Swedish Pension Fund AP4 to focus on climate change

The leading Swedish Pension Fund AP4 is focusing on governance and climate change issues. In PUB+ interview the managing director Mats Andersson, also the Ambassador of UN Decarbonazation Coalition, says that they have done the portfolio decarbonazation over three years ago and  their target is that by 2015 they have all the equity assets as low carbon assets. Mr Andersson was speaking in EarthRate ESG discussion in Stockholm.

-This year we will analyse the Asian markets  and Japan. We have done the earlier
research related to US and European markets. This work has helped us to
minimize the carbon output by 50 per cent, he says.

– In Sweden our focus is on Governance and Climate Change. Abroad we will
focus on working together with other AP funds and other engagement
funds, especially in Japan, he says.

Andersson says that good governance is about diversity, owner-driven strategies and transparent policy.

The fund assets were 295 billion Swedish kronor and  the fund is also awarded by the IPE as the Best Public Penson Fund in 2014.  According to the company during the last 10 years the total return has been 7,6 per cent in average. Last year the total return was 15,7 per cent after the  costs and the fund made their record profit of 40 billion Swedish kronor.

Finance