Green Bonds
Green bonds are fixed-income financial instruments specifically earmarked for funding projects that have positive environmental or climate benefits. These bonds are issued by governments, corporations, or institutions to raise capital for initiatives such as renewable energy projects, energy efficiency improvements, clean transportation, sustainable water management, and other environmental projects that contribute to sustainability and combat climate change.The proceeds from green bonds are used exclusively for environmentally sustainable projects, making them an attractive investment option for socially responsible investors. Green bonds typically adhere to specific guidelines, such as the Green Bond Principles, which outline transparency, disclosure, and reporting requirements to ensure that the funds are used for their intended purposes.Overall, green bonds serve as a mechanism to encourage investment in environmentally friendly activities and facilitate the transition to a more sustainable economy while providing investors with fixed returns on their investments.
