ESG & Investing
Green Bonds Aren’t Driving Climate Action in US, Study Says
- Only 2% of proceeds initiate entirely unique green projects
- Global market for the bonds has grown to more than $3 trillion
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Almost all green bonds issued in the US fail to drive real action to tackle climate change, undermining the merits of a global market that’s grown to more than $3 trillion, according to a study.
An analysis of the first green bonds sold by corporate and municipal issuers between 2013 to 2022 found that about 2% of proceeds were used to fund projects that are genuinely unique or don’t replicate existing work, Pauline Lam and Jeffrey Wurgler said in a working paper published this month by the National Bureau of Economic Research.