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A Greener Future for Finance
Article

A Greener Future for Finance

Green bonds offer lessons for sustainable finance



Editorial Rating

8

Qualities

  • Analytical
  • Eye Opening
  • Background

Recommendation

The business of underwriting sustainable environmental initiatives is sizable. Globally, green bond issuance in 2019 exceeded $250 billion. But these evolving, innovative securities are sophisticated, and as specialization increases, consistent methods of evaluating issues and issuers are crucial to integrating these assets into investment portfolios. This authoritative essay by fund managers Afsaneh Beschloss and Mina Mashayekhi sounds an important caution: While investors welcome the growth and variety of such instruments, they should temper their enthusiasm with some rigorous homework.

Take-Aways

  • The World Bank and the European Investment Bank issued the first green bonds.
  • Securities innovation and complexity are becoming hallmarks of this burgeoning marketplace.
  • Investors need to verify that green bond issuers adhere to quantifiable principles.

About the Authors

Afsaneh Beschloss is the founder and CEO of Rock Creek, an asset management firm, where Mina Mashayekhi is a senior adviser.