Odd Lots
Green Bonds Are Making Fewer and Fewer Promises to Investors
New research suggests incentives trump enforcability in a $5.5 trillion market.
A wind turbine and a local resident on a bicycle in Jaffna district, Sri Lanka.
Photographer: Jonathan Wijayaratne/BloombergThis article is for subscribers only.
In art, green is created by mixing together the primary colors of blue and yellow. In finance, green is created by mixing together a hefty dose of promotion and lax bond documentation.
The market for green bonds — or debt meant to finance renewable energy and other sustainability-related projects — has exploded in recent years. But the tide may now be turning for environmental, social and governance investing due to fresh regulatory scrutiny and political opposition.