Indicator 13.70 Green bond issuance

Green bonds are loans provided by an investor to a borrower which are used to fund projects or activities that promote climate change mitigation or adaptation or other environmental objectives. While the green bond definition can vary, this indicator includes bonds that are aligned with the four core components of the International Capital Market Association (ICMA) green bond principles or are certified by the Climate Bond Initiative (CBI). Issuers include corporates such as a company or financial corporation, and sovereign bond issuers which are national governments. Sovereign bonds issued by governments are only included if they have a maturity of more than one year.

Indicator is used to monitor progress towards SDG 13 on climate action which is embedded in the European Commission’s Priorities under ‘Sustaining our quality of life: food security, water and nature’. SDG 13 seeks to implement the commitment to the United Nations Framework Convention on Climate Change for achieving a climate neutral world by mid-century to limit global warming to well below 2°C and aiming at 1.5°C (compared to pre-industrial times). It also aims to strengthen countries’ resilience and adaptive capacity to climate-related natural hazards and the resulting disasters.

As part of the transition towards climate neutrality and climate resilience, the EU is endeavouring to redirect public and private investments to areas where they will support this objective. For this reason, the EU has adopted the EU taxonomy as a classification system for sustainable economic activities and a European green bond standard as a voluntary ‘gold’ standard for the green bond market. At EU level, climate change mitigation and adaptation has been integrated into all major spending programmes and the EU has also committed to support international climate action. This indicator is a headline indicator for monitoring progress towards meeting targets of the Eighth Environment Action Programme (8th EAP).

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