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Development of green project financing market: Bank of Russia’s role

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The Bank of Russia intends to create conditions for the development of a market for ‘green’ and social bonds and ‘green’ mortgage, as well as to facilitate the adaptation of financial market participants to climate risks. A special working group established at the Bank of Russia will coordinate the preparation of concrete proposals with regard to various areas of sustainable development.

‘The infrastructure for ‘green’ and social financing is being established all over the world, and we have also started to work in this direction. We will cooperate with market participants, the expert and academic community, development institutions, and relevant agencies. This is a new area, where investors are involved in changing the economy and take part in environmental and social projects that reduce the negative impact on the environment’, said Sergey Shvetsov, First Deputy Governor of the Bank of Russia.

Environmental and climate change issues have been on the agenda of regulators in many countries for a number of years already, and the Bank of Russia focuses its attention on them as well. For example, the possibility of issuing ‘green’ and social bonds is provided for by the new issuance standards published by the regulator. The Moscow Exchange already has a Sustainable Development Sector for bonds aimed at financing ecological, environmental and socially important projects. The Bank of Russia has also prepared recommendations on responsible investment for institutional investors.

In addition, the Bank of Russia jointly with the Ministry of Economic Development and VEB.RF develops criteria for determining sustainable development projects and establishes a methodological basis for the verification of ‘green’ instruments. The regulator is currently assessing systemic risks to the economy and the financial market associated with climate change issues and the implementation of the climate change agenda by foreign countries.

The working group will regularly inform the market about the results of its activities and the implementation of sustainable development projects.

See PDF here: https://www.cbr.ru/statichtml/file/59420/20200715_in_06_28-111.pdf

This news item was originally published by the Central Bank of the Russian Federation (CBR RU). For more information, see the Source Link.

Regulator Information

Abbreviation: CBR
Jurisdiction: Russian Federation

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