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One major stumbling block for implementation of the Paris Agreement (PDF) remains one of financing, particularly the opportunity for developing countries to catch up. In this environment, green bonds have emerged as one of the simplest solutions for raising money.
To some, this financing vehicle is almost a panacea: Issue green bonds and the problem will be solved.
But the link between issuance and impact is not automatic. How green, really, is the project financed by a green bond? Most progress indicators are stated in terms of green financing made available, such as the Green Pledge, which calls for $1 trillion of green bonds to be issued during 2020. But most don’t measure the impact of the projects financed.