Greens Bonds are a certain form of bonds, meaning fixed-interest securities handed out by states, enterprises or federal states. The revenue from Green Bonds is solely used for the financing of ecological projects. However, what is the exact meaning, how is it verified, and do Green Bonds really contribute to the provision of more capital for green projects?
The calculations for the volume of capital that will be needed to change course towards a more socially and environmentally sustainable way of doing business are on the table. There is agreement that this capital will mainly need to come from private investors. Green bonds are a beacon of hope. The demand for these bonds, which are used to finance sustainable projects, far exceeds the supply. However, are these green bonds really as green as they maintain they are and do they really produce additional funding for sustainable projects?