European Union negotiators reached a deal to establish a green bond standard, giving investors long-awaited clarity that their money is aligned with the region’s climate ambitions.
Companies that use the standard will have to prove that the proceeds from their green bonds are in line with the bloc’s list of environmentally friendly activities, known as the taxonomy. They will, however, get a 15 per cent “flexibility pocket” for activities that aren’t yet covered by the rulebook, according to the terms of the agreement reached by EU lawmakers and member states.
“This regulation creates a gold standard that green bonds can aspire to,” said Paul Tang, parliament’s chief negotiator. “Any green bonds not using this system will likely be looked at with increasing