Monday, November 28, 2011

Climate Bonds! May you live long and prosper!

From the Nov. 27, 2011, edition of the New York Times, by Sonia Kolesnikov-Jessop: A Change of Heart on Investing in the Climate.

This article describes a new form of financing for climate change adaptation now underway. These "green bonds" focus on "battling climate change" -- e.g., backing mitigation and adaptation investments-- using a relatively low-risk finance instrument. They will only be successful if they get enough projects to back and enough big investors, but they've only just launched and... "[Sean Kidney, executive chairman of the Climate Bonds Initiative] estimates that $14 billion to $30 billion worth of bonds backed by investments related to climate change solutions have already been issued internationally..."

Kidney elaborates on what these bonds should cover:

"'[W]hen you’re talking about building a low-carbon economy, it should not be just about mitigation but about adaption as well. Water investments in North Africa might be considered climate adaptation bonds. Adaptation would look at infrastructure for disaster risk reduction, flood defenses or forestry conservation.'"

Find out more here:

Climate Bonds Initiative - "an investor-focused nongovernmental organization set up to promote large-scale investment in the low-carbon economy"

CBI's new Climate Bond Standards and Certification Board - launched on Nov. 24, 2011.

The Oct. 19, 2011, press release about the launch of the State Street Global Advisors (SSgA)'s High Quality Green Bond Strategy "a way to direct fixed income investments to climate solutions."

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