Green Bonds Still Have a Long Way to Go to Dent Climate Crisis.

For all the money that companies and governments are raising in the green-bond market to fund environmental projects globally, there’s still a long way to go to adequately fund the fight against climate change, according to the Climate Bonds Initiative.

Global sales of green bonds — the largest category of sustainable debt by dollar volume — hit a record $513 billion last year, according to data compiled by Bloomberg. Sales could reach fresh highs of between $900 billion and $1 trillion by the end of this year and up to $5 trillion by 2025, the London-based Climate Bonds Initiative estimates.

Borrowers around the world, nonetheless, will have to raise even more money to tackle climate change, with a recent analysis from McKinsey & Co. estimating $9.2 trillion a year annually through 2050 in investment needed to reach net zero. There’s a need to shift more capital to greener initiatives — in addition to raising new debt — to achieve the trillions of dollars needed, according to Sean Kidney, chief executive officer of the non-profit CBI.

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Advisor Perspectives

by Caleb Mutua, 2/1/22



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