Climate Bonds Initiative developing criteria for water investments that back green bonds

By Lisa Kerner

Charlotte, N.C., Nov. 7 – The Climate Bonds Initiative announced that it held its first meeting of a new water-focused expert group on Friday.

The group, made up of key water sector and industry experts from around the world, will develop criteria for water investments that can be used to back green and climate bonds certified under the Climate Bond Standard, according to a news release.

The Climate Bond Standard is a tool that investors and governments can use to assess the environmental integrity of bonds.

Among the investment areas, the expert group plans to explore are clean water projects, water treatment infrastructure and agricultural usage, as well as storm and flood drainage and protection.

“The potential for green bonds in the water sector is enormous,” said Climate Bonds chief executive officer Sean Kidney.

“While it may be tempting to define every water project as ‘green,’ water investments that don’t take into account climate change, with, for example, its increased volatility of rainfall – dumps and droughts – will come to be seen as both higher risk and not consistent with green.”

According to Kidney, “Investors will want to be sure that investments don’t make matters worse.”

The water-focused Expert Group was brought together by the Climate Bonds Initiative, in collaboration with Ceres, the World Resources Institute and CDP (formerly Carbon Disclosure Project). The Group includes representatives of organizations including the OECD, Asia Development Bank, Imperial College London, Alliance for Global Water Adaptation, D.C. Water, Chinese Academy of Sciences and the Stockholm International Water Institute.

The Climate Bonds Initiative is an investor-focused not-for-profit that promotes large-scale investment in the low-carbon economy.

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