Climate bonds and their role in the development of ESG-finance banking practice: Global and Russian experiences

Abstract

The history of banks' involvement in solving the issues of sustainable development of the society is, on the one hand, short by the standards of economic history, and on the other hand, bright and ambiguous. This is explained by the strategic goal of the banking institution functioning - ensuring a stable turnover of financial resources in the socio-economic system of the country and building up financial capital. It is the latter component that caused the interest of the market and state regulators in the possibility of attracting banks' capital to finance so-called "green projects" aimed at solving local or global environmental problems of mankind. Today, the strategic agenda of more and more banks includes various elements of ESG-methodology of responsible corporate behavior, implemented in the form of corporate social policy (mainly focused on the bank's staff and its clients) and a portfolio of "green investments" - a group of projects that are mainly socially-oriented or infrastructural in nature. The purpose of such responsible investment is both to solve specific socially or environmentally important tasks and to strengthen the market position of the bank-investor itself, which forms a positive image in the eyes of its key stakeholders and improves the rating position of investment attractiveness both domestically and in international rankings compiled by reputable analytical agencies, such as S&P, Moody's Investors, and Fitch Ratings.