NEW YORK, Feb. 7, 2022 /PRNewswire/ -- (S&P Global Ratings) -- Global sustainable bond issuance is expected to surpass $1.5 trillion in 2022 even as global bond issuance stagnates overall, said a new report S&P Global ratings released today. This growth will be driven partly by the booming sustainability-linked and green bond markets as public and private sector issuers tackle their climate commitments.
Sustainability-linked bonds will be the fastest-growing segment of the market. Because proceeds are typically not ring-fenced for specific environmental or social projects, these instruments have proven more flexible and accessible than use of proceeds instruments for a variety of issuers.
Green bonds will also see record issuance volumes in 2022, maintaining their position as the dominant sustainable bond category. Many countries committed to increasing their emissions reduction targets at COP26, thus sovereign bond issuance to finance green projects will likely accelerate.
We also expect continued growth of social and sustainability bonds as they diversify into new projects in support of the 2030 Sustainable Development Goals agenda.
As diversification and innovation in sustainable bond structures grows, ensuring greater integrity and credibility across the market will be key. Efforts to further establish and encourage the uptake of clear standards, regulations, and disclosure requirements will be critical.
This report does not constitute a rating action.
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