China fights pollution issuing Green Bonds
China has dominated global issuance of "green" bonds for two straight years — a trend that will likely continue as the world's top carbon-emitter tries to play a larger role to contain climate change.
The Asian economic giant burst onto the scene in 2016 to take the crown as the world's largest issuer of green bonds — a debt instrument with proceeds that are used to finance activities that benefit the environment. China is set to retain its top spot in 2017.
By the end of November 2017, China led global green bond issuance with 66 deals that raised $24.89 billion, according to data firm Dealogic. The country's dominance in that particular debt market followed its 2016 record of 43 deals totaling $33.17 billion, which allowed it to leapfrog traditional green financing giants such as the United States and France.
"China is one of the countries most exposed to pollution, particularly air pollution. Following the Paris 2015 United National Climate Change Conference, they have shown keenness to fight climate change," said Alban de Fäy, a portfolio manager at Amundi Asset Management who handles socially-responsible, fixed-income investments.
Hovewer, the People’s Bank of China and China Securities Regulatory Commission have co-released a guidance to clarify the threshold of conducting the business of green bond assessment and verification, Securities Daily reported.
The guidance requires that institutions which aim to operate in this area must fulfill four basic conditions. First, certifying bodies must have set up related workflows, technical methods, quality controls and liability insurance. Second, they must have been granted assessment and verification licences in the field of energy, climate and environment.
Third, they must be staffed with professionals in the field of accounting, auditing, finance, energy, climate or environment. Fourth, there can be no violations of laws, regulations or bad credibility records in the last three years.