In 10 years green bonds have gone from being an esoteric fringe product to being accepted and used in the mainstream of the international capital markets. These instruments are critical in helping to bridge the massive investment gap required to meet the targets set out in the 2016 Paris Agreement on Climate Change and the 2015 UN Sustainable Finance Development Goals.

However, there are several concerns which could undermine the credibility and evolution of green bonds as a much-needed market product. These include a surprising lack of green contractual protection for investors, so-called greenwashing, the quality of reporting metrics and transparency, issuer confusion and fatigue, and a perceived lack of pricing incentives for issuers.

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