Green bonds take another step forward
March 1, 2023
Negotiators of the Council and the European Parliament reached a provisional agreement on creating European green bonds.
In Brussels yesterday (28 February), negotiators of the European Council and the European Parliament moved forward on their sustainable finance goals. They reached a provisional agreement on creating European green bonds (EuGB).
“The new standard which we are setting will be useful for both issuers and investors of green bonds. Issuers will be able to demonstrate that they are funding legitimate green projects aligned with the EU taxonomy. And investors buying the bonds will be able to more easily assess, compare and trust that their investments are sustainable, thereby reducing the risks posed by greenwashing,” said Elisabeth Svantesson, Minister for Finance of Sweden
Environmentally sustainable bonds are one of the main instruments for financing investments related to green technologies, energy efficiency and resource efficiency, sustainable transport infrastructure and research infrastructure.
Under the provisional agreement, all proceeds of EuGBs will need to be invested in economic activities aligned with the EU taxonomy, provided the sectors concerned are already covered by it.
The agreement is provisional as it still needs to be confirmed by the Council and the European Parliament and adopted by both institutions before it is final. It will start applying 12 months after it enters into force.
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