Keywords
green economy
sustainable finance
green bonds
environmental performance
How to Cite
Abstract
This paper identifies regions with high environmental performance by assessing the size of green bond issuance in European countries from a cause-and-effect perspective. Cluster analysis and descriptive statistics were used to meet this research objective. The research subject was the size of green bond issuance, understood as the driving force for the green economy in European countries. The main findings of the research show a strong correlation between the size of green bond issuance and environmental performance. Due to limited access to source data, the analysis of green sources of financing was restricted only to the size of green bond issuance, excluding other funding sources. Identifying the regions with high environmental performance and high value of green bond issuance will allow for an effective support plan for pro-ecological actions by using soft and complex tools of green policy, bearing in mind existing limitations, too. This approach determines groups of countries that share similar features, i.e., the ones that take advantage of green projects financed by the issuance of green bonds and simultaneously have a high environmental performance index.
References
Aytekin, A. (2022). Energy, Environment, and Sustainability: A Multi-criteria Evaluation of Countries. Strategic Planning for Energy and the Environment, 41(3), 281-316. https://journals.riverpublishers.com/index.php/SPEE/article/view/21205/17329
Bacsi, Z. (2020). Environmental Awareness in Different European Cultures. Visegrad Journal on Bioeconomy and Sustainable Development, 9(2), 47-54. https://doi.org/10.2478/vjbsd-2020-0010
Bhutta, U. S., Tariq, A., Farrukh, M., Raza, A., & Iqbal, M. K. (2022). Green bonds for sustainable development: Review of literature on development and impact of green bonds. Technological Forecasting and Social Change, 175, 121378. https://doi.org/10.1016/j.techfore.2021.121378
Björkholm, L., & Lehner, O. M. (2021). Nordic green bond issuers’ views on the upcoming EU Green Bond Standard. ACRN Journal of Finance and Risk Perspectives, 10, 222-279. https://www.acrn-journals.eu/resources/jofrp10l.pdf
Borys, T. (2006). Istota i rozwój analizy przyczynowo-skutkowej z wykorzystaniem wskaźników. Prace Naukowe Akademii Ekonomicznej we Wrocławiu. Gospodarka a Środowisko, 5(1115), 60-69. (in Polish).
Borys, T., Bugdol, M., & Puciato, D. (2022). Barriers to achieving climate goals. An external context. Economics and Environment, 82(3), 8-37. https://doi.org/10.34659/eis.2022.82.3.476
Chuah, J. (2020). Legal Aspects of Green Shipping Finance: Insights from the European Investment Bank’s Schemes. In K.M. Proshanto, M.Q. Mejia & J. Xu (Eds.), Maritime Law in Motion (pp. 131-152). Cham: Springer.
Cicchiello, A. F., Cotugno, M., Monferrà, S., & Perdichizzi, S. (2022). Which are the factors influencing green bonds issuance? Evidence from the European bonds market. Finance Research Letters, 50, 103190. https://doi.org/10.1016/j.frl.2022.103190
Ciot, M.-G. (2022). Implementation Perspectives for the European Green Deal in Central and Eastern Europe. Sustainability, 14(7), 3947. https://doi.org/10.3390/su14073947
Climate Bonds Initiative. (2022, August). Climate Bonds Initiative. www.climatebonds.net
Conferedration of British Industries. (2019). Green Finance Position Paper. Infrastructure and Energy & Financial Services. United Kingdom: CBI.
Cortellini, G., & Panetta, I. C. (2021). Green Bond: A Systematic Literature Review for Future Research Agendas. Journal of Risk and Financial Management, 14(12), 12. https://doi.org/10.3390/jrfm14120589
Czech, S. (2011). Nordycki model państwa dobrobytu – zarys ewolucji i perspektyw. Studia Ekonomiczne / Uniwersytet Ekonomiczny w Katowicach. Społeczno-kulturowe uwarunkowania systemów gospodarczych, 69, 192-205. (in Polish).
Demirel, P., Li, Q. C., Rentocchini, F., & Tamvada, J. P. (2019). Born to be green: new insights into the economics and management of green entrepreneurship. Small Business Economics, 52, 759-771. https://doi.org/10.1007/s11187-017-9933-z
Ennomotive. (2023, January). 6 Eco-friendly technologies to help companies go green. www.ennomotive.com/eco-friendly-technologies-go-green/
Ermakova, E. P., & Frolova, E. E. (2021). Combating Climate Change by Finance – The Experience of the Netherlands. In E.G. Popkova & B.S. Sergi (Eds.), Modern Global Economic System: Evolutional Development vs. Revolutionary Leap (pp. 1794-1806). Cham: Springer. https://doi.org/10.1007/978-3-030-69415-9_198
European Commission. (2017). Defining "green" in thecontext of green finance. Final Report. https://ec.europa.eu/environment/enveco/sustainable_finance/pdf/studies/Defining%20Green%20in%20green%20finance%20-%20final%20report%20published%20on%20eu%20website.pdf
Flammer, C. (2021). Corporate Green Bonds. Journal of Financial Economics, 142, 499-516. https://doi.org/10.1016/j.jfineco.2021.01.010
Hadaś-Dyduch, M., Puszer, B., Czech, M., & Cichy, J. (2022). Green Bonds as an Instrument for Financing Ecological Investments in the V4 Countries. Sustainability, 14(19), 12188. https://doi.org/10.3390/su141912188
Heine, D., Semmler, W., Mazzucato, M., Braga, J., Flaherty, M., Gevorkyan, A., Hayde, E., & Radpour, S. (2019). Financing low-carbon transitions through carbon pricing and green bonds. Vierteljahrshefte zur Wirtschaftsforschung, 88(2), 29-49. http://dx.doi.org/10.3790/vjh.88.2.29
IEA. (2022, September). International Energy Agency. www.iea.org
International Capital Market Association. (2015). Green Bond Principles. Voluntary Process Guidelines for Issuing Green Bonds. https://www.icmagroup.org/assets/documents/Regulatory/Green-Bonds/GBP_2015_27-March.pdf
Kanamura, T. (2020). Are green bonds environmentally friendly and good performing assets? Energy Economics, 88, 104767. https://doi.org/10.1016/j.eneco.2020.104767
Kashi, A., & Shah, M. E. (2023). Bibliometric Review on Sustainable Finance. Sustainability, 15(9), 7119. https://doi.org/10.3390/su15097119
Lee, J-D., Lee, K., Meissner, D., Radosevic, S., & Vonortas, N.S. (2021). The Challenges of Technology and Economic Catch-up in Emerging Economies, Oxford University Press.
Li, S., Liu, Q., Lu, L., & Zheng, K. (2022). Green policy and corporate social responsibility: empirical analysis of the Green Credit Guidelines in China. Journal of Asian Economics, 82, 101531. https://doi.org/10.1016/j.asieco.2022.101531
Lyytimäki, J. (2020). Environmental journalism in the Nordic countries. In D.B. Sachsman & J.M. Valenti (Eds.), Routledge handbook of environmental journalism (pp. 221-233). London: Routledge.
Naaraayanan, S. L., Kunal, S., & Varun, S. (2020). The Real Effects of Environmental Activist Investing. European Corporate Governance Institute – Finance Working Paper, 743. http://dx.doi.org/10.2139/ssrn.3483692
Nanayakkara, M., & Colombage, S. (2019). Do investors in green bond market pay a premium? Global evidence. Applied Economics, 51(40), 4425-4437. https://doi.org/10.1080/00036846.2019.1591611
Ozili, P. K. (2022). Green finance research around the world: a review of literature. International Journal of Green Economics, Forthcoming, 1-31. https://ssrn.com/abstract=4066900
Pastor, L., Stambaugh, R. F., & Taylor, L. A. (2022). Dissecting green returns. Journal of Financial Economics, 146(2), 403-424. https://doi.org/10.1016/j.jfineco.2022.07.007
Peng, W., Shibaob, L., & Wenjing, L. (2022). Green financing for the establishment of renewable resources under carbon emission regulation. Renewable Energy, 199, 1210-1225. https://doi.org/10.1016/j.renene.2022.08.140
Rosenlund, J., Nyblom, Å., Ekholm, H. M., & Sörme, L. (2020). The emergence of food waste as an issue in Swedish retail. British Food Journal, 122(11), 3283-3296. https://www.emerald.com/insight/0007-070X.htm
Sinha, A., Mishra, S., Sharif, A., & Yarovaya, L. (2021). Does green financing help to improve environmental & social responsibility? Designing SDG framework through advanced quantile modelling. Journal of Environmental Management, 292, 112751. https://doi.org/10.1016/j.jenvman.2021.112751
Starks, L. T., Venkat, P., & Zhu, Q. (2017). Corporate ESG Profiles and Investor Horizons. Wharton Research Data Services (WRDS) Research Paper Series, 1-53. http://dx.doi.org/10.2139/ssrn.3049943
Teti, E., Baraglia, I., Dallocchio, M., & Mariani, G. (2022). The green bonds: Empirical evidence and implications for sustainability. Journal of Cleaner Production, 366, 132784. https://doi.org/10.1016/j.jclepro.2022.132784
Torvanger, A., Maltais, A., & Marginean, I. (2021). Green bonds in Sweden and Norway: What are the success factors? Journal of Cleaner Production, 324, 129177. https://doi.org/10.1016/j.jclepro.2021.129177
UNEP. (2016). Definitions And Concepts. Background Note. https://wedocs.unep.org/bitstream/handle/20.500.11822/10603/definitions_concept.pdf?sequence=1&%3BisAllowed=
Valério, N., Soares, M., Vilarinho, M. C., & Carvalho, J. (2023). Ecofriendly Technologies of Fish Oils and Collagen Extraction from Fishery Waste – A Review. In J. Machado, F. Soares, J. Trojanowska, E. Ottaviano, P. Valášek, M.D. Reddy, E.A. Perondi & Y. Basova (Eds.), Innovations in Mechanical Engineering II (pp. 136-147). Cham: Springer.
Veggeland, N. (2014). The Nordic Model - Its Arrival and Decline. Global Journal of Management and Business Research, 14(A9), 9-17. https://journalofbusiness.org/index.php/GJMBR/article/view/1472
Wang, L., Dilanchiev, A., & Haseeb, M. (2022). The environmental regulation and policy assessment effect on the road to green recovery transformation. Economic Analysis and Policy, 76, 914-929. https://doi.org/10.1016/j.eap.2022.10.006
Wang, Y., & Taghizadeh-Hesary, F. (2023). Green bonds markets and renewable energy development: Policy integration for achieving carbon neutrality. Energy Economics, 123(5068), 106725. https://doi.org/10.1016/j.eneco.2023.106725
Wolf, M. J., Emerson, J. W., Esty, D. C., de Sherbinin, A., & Wendling, Z. A. (2022). Environmental Performance Index. New Haven, CT: Yale Center for Environmental Law & Policy.
World Bank. (2015, December 1). What Are Green Bonds? https://www.worldbank.org/en/topic/climatechange/brief/what-are-green-bonds
Zaremba Bielawski, M. (2014). Leśna mafia. Szwedzki thriller ekologiczny. Warszawa: Agora. (in Polish).
Zerbib, O. D. (2019). The effect of pro-environmental preferences on bond prices: Evidence from green bonds. Journal of Banking and Finance, 98, 39-60. https://doi.org/10.1016/j.jbankfin.2018.10.012
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
Copyright (c) 2024 Economics and Environment