Beyond the Label: An Assessment of the Green Bond Market

Highlights

• Growing interest in ESG focused investments is causing demand for green bonds to outpace supply
• Lack of consensus about labeling, certification and terminology highlights the need for investors to focus on the characteristics of each green bond and its issuer
• How issuers track corporate bond proceeds suggest that municipal green bonds may provide more certainty about the proceeds’ sustainability impact
• Financial and risk/return characteristics of green bonds and their conventional counterparts are similar