The commonly accepted practice that those who produce pollution should bear the costs of managing it to Green bonds are debt instruments specifically designed for financing environmentally beneficial projects, thus aligning financial returns with eco conscious objectives and attracting investors interested in profit and positive
environmental impact.
Green bonds may be issued by the government, financial institutions, enterprises and other issuers to bond buyers, promising to pay interest at a certain rate and repay the principal and interest in accordance with the agreed terms.
Source: Trotta (2024), Encyclopedia of Monetary Policy, Financial Markets and Banking
