Finance
Green Bond
Definition
A fixed-income financial instrument specifically earmarked to fund climate and environmental projects — renewable energy, energy efficiency, clean transportation, and sustainable infrastructure.
Explanation
The green bond market has grown from $3 billion in 2012 to over $500 billion annually. The EU, World Bank, and major corporations are leading issuers. Green bonds typically offer similar returns to conventional bonds but attract ESG-focused investors. Certification standards (Climate Bonds Initiative, EU Green Bond Standard) prevent "greenwashing." Sovereign green bonds have been issued by France, Germany, and the UK.