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Climate Bonds publishes updated Green Bond methodology
07/06/2022 Since 2 years

Climate Bonds has released the latest update to its Green Bond Methodology, which is used to assess self-labeled green bond issuances from around the world and include them in the Climate Bonds Initiative’s Green Bond Database. The selection is based on two key aspects: eligible sectors and eligible use of funds. The updated methodology tightens criteria for more established sector and seeks to be consistent with the EU Taxonomy.

Among some of the key methodology updates are the inclusion of criteria for hydrogen, as well as the expansion of criteria for bioenergy and hydroelectricity. Within the construction sector, the criteria were tightened to reflect the greater ambition needed to decarbonize the sector by 2050 and also certification requirements were increased. Transport criteria were also tightened, ensuring consistency with the EU Taxonomy. This new edition expands and provides more details within the Waste, Land, Marine Use and ICT sectors. Sustainable fisheries and fish farming are no longer included.

Within the methodology, the guidelines on investment in R&D were expanded. Processes related to disclosure by issuers were also expanded as strict disclosure standards are needed to facilitate transparency and credibility in determining whether investments are truly “green”.

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