Post by account_disabled on Mar 5, 2024 20:35:24 GMT -8
The influential agency forecasts 24% growth for the green bond market this year, as investment is boosted when there is greater clarity from governments and regulators.
Green, social and sustainability Chile Mobile Number List bond issuances could rise 24% to a record $400 billion in 2020, according to a forecast from credit ratings giant Moody's, agency expects another boom year for booming environmental bond market , after issuances in the green, social and sustainability bond categories rose to $323 billion in 2019. Green bonds remain the largest market sector within the group, with issuances likely to reach $300 billion this year.
The issuance of social and sustainability bonds is expected to reach $25 billion and $75 billion respectively, he added.
Moody's also expects issuances from the social and sustainability segments to become more diversified in terms of sector and region as the market grows and matures, mirroring trends seen in the green bond market.
Growth within the sustainable finance sector, beyond these segments will also be driven by more innovative labels and structures, as well as the increasing focus on climate action by governments and companies, Moody's said.
The financial sector is increasingly prioritizing incorporating ESG (environmental, social and governance) and sustainability considerations into its investment and risk management decisions, a trend that Moody's said it expects to continue.
The agency also predicts an acceleration in the growth of issuances of alternative sustainability-themed labels, such as transition bonds. However, the performance of the nascent sector may be uneven in the short term, due to the current lack of clear definitions on which projects could qualify for the emerging segment, he said.
For example, although various definitions for "transition bonds" have been proposed, a common theme is that the proceeds could be used to help carbon-intensive companies become more sustainable over time, an approach that has been criticized by some activists. who argue that they are ostensibly “green”, bonds could risk prolonging the life of carbon-intensive assets.
Moody's predicted that a growing focus on organization-wide sustainability and a preference for the flexibility offered by general corporate lending will also contribute to a greater focus on sustainability-linked bonds and loans, noting that the market rose to $134 billion globally in 2019, up from just $34 billion in 2018.
Green, social and sustainability Chile Mobile Number List bond issuances could rise 24% to a record $400 billion in 2020, according to a forecast from credit ratings giant Moody's, agency expects another boom year for booming environmental bond market , after issuances in the green, social and sustainability bond categories rose to $323 billion in 2019. Green bonds remain the largest market sector within the group, with issuances likely to reach $300 billion this year.
The issuance of social and sustainability bonds is expected to reach $25 billion and $75 billion respectively, he added.
Moody's also expects issuances from the social and sustainability segments to become more diversified in terms of sector and region as the market grows and matures, mirroring trends seen in the green bond market.
Growth within the sustainable finance sector, beyond these segments will also be driven by more innovative labels and structures, as well as the increasing focus on climate action by governments and companies, Moody's said.
The financial sector is increasingly prioritizing incorporating ESG (environmental, social and governance) and sustainability considerations into its investment and risk management decisions, a trend that Moody's said it expects to continue.
The agency also predicts an acceleration in the growth of issuances of alternative sustainability-themed labels, such as transition bonds. However, the performance of the nascent sector may be uneven in the short term, due to the current lack of clear definitions on which projects could qualify for the emerging segment, he said.
For example, although various definitions for "transition bonds" have been proposed, a common theme is that the proceeds could be used to help carbon-intensive companies become more sustainable over time, an approach that has been criticized by some activists. who argue that they are ostensibly “green”, bonds could risk prolonging the life of carbon-intensive assets.
Moody's predicted that a growing focus on organization-wide sustainability and a preference for the flexibility offered by general corporate lending will also contribute to a greater focus on sustainability-linked bonds and loans, noting that the market rose to $134 billion globally in 2019, up from just $34 billion in 2018.