Investors going green with bonds

16 July 2015
| By Jassmyn |
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Investors are doing their part in helping the environment as the global green bond market is expected to grow significantly this year, according to BNP Paribas.

The company said investment in green infrastructure is increasing at a rapid rate both domestically and overseas.

Head of global markets, James Hayes said BNP Paribas was receiving more and more enquiries from corporates about this avenue of fund raising.

"We expect green bond issuance to increase and diversify as governments across Asia Pacific look to build cleaner urban infrastructure and energy production," he said.

Hayes said a reason for the growth was the increasing adoption of ESG [environment, social and governance] by institutional investors, as seen this month by pension funds such as CalPERs and others.

"Another reason is the increasing use of ESG in risk management. This ranges from simple diversification of funding sources and investments to ESG overlays being increasingly used as another form of risk analysis and management by institutional investors."

He said green bonds also helped supranational and sovereign investors demonstrate that they are responsible investors.

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