Green bonds
Produced in partnership with Jacqueline Heng of Norton Rose Fulbright

The following Banking & Finance practice note produced in partnership with Jacqueline Heng of Norton Rose Fulbright provides comprehensive and up to date legal information covering:

  • Green bonds
  • What are green bonds?
  • Types of green bonds
  • Green use of proceeds bond
  • Green use of proceeds revenue bond
  • Green project bond
  • Green securitised bond
  • Green Bond Principles
  • Use of proceeds
  • Process for evaluation and selection
  • More...

Green bonds

Green bonds are a natural source of financing for issuers who have a financing or refinancing requirement for a green project. There does not currently appear to be a premium for green bonds compared to non-green bonds of the same issuer. Further, an issuer who would use the proceeds to finance projects towards its environmentally friendly programmes (for example, to reduce the carbon footprint or waste from its ordinary business activities) could also tap the market and further signal its commitment to its cause. Green bonds can be attractive to issuers and investors alike with the right balance on the green and commercial aspects.

This Practice Note covers:

  1. What are green bonds?

  2. Types of green bonds

  3. Green Bond Principles

  4. Assurance

  5. How green is green?

  6. Market development, and

  7. Next frontier and trends

What are green bonds?

Green bonds are bond issues whereby the proceeds are ring-fenced and exclusively applied to finance or re-finance in part or in full new and/or existing projects that will promote progress on environmentally sustainable activities.

Green bonds have historically been issued by multilateral lenders such as the World Bank, the African Development Bank and the European Investment Bank. However, corporates have increasingly issued green bonds to increase market appeal to a broader investor class, and particularly if the proceeds will be used in any case for environmentally friendly projects such as development of

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