ESG & Investing
Ex-HSBC Banker Sees Contentious ESG Label Dethroning Green Bonds
- Companies have flexibility how to use proceeds from SLBs
- Green bond market has ‘natural limitations’: Daniel Klier
This article is for subscribers only.
A former HSBC Holdings Plc banker says one of the most criticized sustainable bond structures on Wall Street has the potential to dominate the roughly $6 trillion ethical debt market.
Sustainability-linked bonds, which tie interest payments to a company’s environmental or social goals, have to build trust and transparency for the market to grow, said Daniel Klier, the chief executive officer of ESG Book, a data provider. Still, SLBs have more potential than the dominant green bond market that will likely hit a ceiling, according to Klier, the former global head of sustainable finance at HSBC.