Members of the Council of Europe and European Parliament have reached an agreement on the creation of the first Green Bond Standard in the world.
The interest from investors for so-called green bonds, which are used to finances renewable energy projects, transports with low CO2 emissions and well-insulated dwellings, is on a rapid rise.
However, until now the EU did not have a unified standard to affirm the longevity of investments.
The two European institutions of power announced on Tuesday that they have reached an agreement on the world’s first standard for green bonds.
The parliament notes that this way investors will be motivated to direct their investments towards the most sustainable technologies and business.
The European Commission presented such a proposal in July 2021.
This standard meets the green green label, known in EU terminology as taxonomy or the union’s legislative acts that state which economic activities can be considered sustainable.
«Investors buying the bonds will be able to more easily assess, compare and trust that their investments are sustainable, thereby reducing the risks posed by greenwashing,» said Sweden’s Minister of Finance Elisabeth Svantesson.
Now it is necessary to approve the agreement officially in the Council of Europe and European Parliament.
The EU has outlined the goal to achieve carbon neutrality by the year 2050.
Also read: Damage caused by earthquake reaches 34 billion dollars in Turkey