China green bonds: A sustainable asset class

China is shifting the green bond market with its increasing utilization of green financing

Oct 30, 2017 | Ken Hu

    

The global green bond market has developed rapidly over the past decade, providing investors access to an asset class that satisfies responsible investing and ESG mandates and is intended to deliver competitive returns.

Despite issuing its first green bond only in 2015, China has already emerged as the world leader. In a short space of time, Chinese regulators and authorities have introduced the new asset class, created a market for it and unveiled comprehensive guidelines on how to use, manage and report proceeds. The scale of development in the country’s green bond market makes it an asset class to watch for both ESG-driven and non-ESG-driven investors alike.

Facing an imperative to address pollution concerns and finance sustainable development under its “One belt, One Road” policy, China’s appetite for green bonds should continue to grow.

 

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**A version of this white paper appeared in the South China Morning Post as “Mainland green bonds the asset class to watch for investors” (30 October 2017)