RBC Capital Markets was proud to host our 4th annual Green Bond Conference, bringing together leaders in the industry to discuss the growth of the green bond market globally and its future development in Canada.
This year, it seems to be a hot topic. Our RBC Capital Markets Credit Research team has declared that ‘green is the new black’, referring to green bond issuance. Since the first issue in 2007, green bond issuance has gained momentum to reach an aggregate $190B+ at the end of Q1 2017. Globally, 2016 was a milestone year for green bonds with $82B issued.
Our research report on the topic found that corporations are seeing more opportunity and strong business cases in green bonds. Observations and predictions on the subject included:
- The appetite of institutional investors for green bonds has grown substantially in recent years.
- Global green bond issuance will be driven by the nearly $500B per year of investment that will be required to achieve greenhouse gas emissions targets laid out in the 2015 Paris Agreement.
- In Canada, growth in green bond issuance will be supported by the Federal Government’s aggressive green agenda. With this agenda, Canada could soon join the sovereign green bond club, currently occupied by Poland and France (both recently issuing sovereign green bonds).
- Standardization and green “scoring” can make the green bond investing process more efficient for investors.