It is often claimed that investors purchasing green-labelled bonds pay an inflated price. Writing for Growth Company Investor, Michael Wilkins, managing director, Environmental & Climate Risk Research, S&P Global Ratings, wades in on the debate.
Wilkins notes that the limited supply (and overwhelming demand) of green bonds has driven up their value compared to conventional “vanilla” bonds. Although unlikely for at least another five years, Wilkins believes this pricing differential may eventually balance out.
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