The Green Bond Market Explained (And Why Investors Do Need to Worry About Climate Risk)

Hear from Sean Kidney, CEO of the Climate Bonds Initiative, as we explore the many ways finance is going green, from the phenomenal growth of the green bond market, to the ongoing revolution in investor sentiment, to the growing financial risks from climate change… and much, much more!

There are few challenges facing humanity as important as the transition towards a resilient, net-zero global economy. The mitigation and adaptation required will need great deal of both public and private investment. In this context, green bonds are an exciting opportunity for long-term investors, who are increasingly incorporating climate risk into their financial decision-making.

Today’s episode starts off with the remarkable growth of the green bond market, before moving onto a wide range of topical issues, including:

• Broader market trends, including transition finance, and the growing convergence of climate science and transition policy;
• The relationship between food and energy security, the transition to net-zero, and Russia’s war on Ukraine;
• In response to comments by Stuart Kirk, why investors really do need to worry about the financial risks from climate change.

Links from today’s discussion:

• Climate Bonds Initiative (CBI) homepage: https://www.climatebonds.net/
• International Finance Corporation’s (IFC) green bond page: https://www.ifc.org/wps/wcm/connect/corp_ext_content/ifc_external_corporate_site/about+ifc_new/investor+relations/ir-products/grnbond-overvw
• Grantham Research Institute on Climate Change and the Environment – The Stern Review: https://www.lse.ac.uk/granthaminstitute/publication/the-economics-of-climate-change-the-stern-review/
• Climate Bonds Initiative Steel Criteria: https://www.climatebonds.net/standard/steel
• Ex-HSBC employee Stuart Kirk’s comments on climate risk: https://www.bbc.co.uk/news/business-61519111
• European Commission’s Platform on Sustainable Finance: https://ec.europa.eu/info/business-economy-euro/banking-and-finance/sustainable-finance/overview-sustainable-finance/platform-sustainable-finance_en
• Eila Kreivi’s Climate Risk Podcast on the EU Taxonomy for Sustainable Finance: https://www.garp.org/podcast/eu-taxonomy-sustainable-finance-cr-220616
• Mark Campanale on the Climate Risk podcast (discusses the EU Taxonomy at 00:16:08) https://www.garp.org/podcast/net-zero-supply-side-issue-cr-220303 

Speaker Bio

Sean Kidney, CEO, Climate Bonds Initiative

Sean is CEO of the Climate Bonds Initiative, an international NGO working to mobilize global capital for climate action. Their work includes a green bond definitions and certification scheme with $34 trillion of assets represented on its Board and some 200 organizations involved in its development and governance.

Sean is a member of the European Commission's Platform on Sustainable Finance and is a Professor in Practice at SOAS University of London, and for the past three years, he has been voted GlobalCapital magazine’s “Most Influential Champion” of the sustainable finance market.