EU Green Bond Standard
The European Green Bond Standard Regulation introduces a voluntary EU label for the issuance of green bonds.
Issuers willing to label their green bonds as “European Green Bond” or “EuGB” will have to follow a set of specific criteria, including using at least 85% of their proceeds in economic activities aligned with the EU Taxonomy. With the aim of creating an international gold standard, the Regulation also introduces some voluntary disclosure requirements for non-EU bonds with environmental objectives.
Additionally, issuers of European Green Bonds will have to disclose information on their use of proceeds, and, when they publish transition plans, how proceeds contribute to implementing and funding these plans.
The Regulation also establishes a registration system and a supervisory framework for external reviewers of EuGBs.
The Regulation introducing this label is applicable starting 21 December 2024.
This standard will be useful to further incentivise the issuance of green bonds in the EU while strengthening their credibility and reliability towards investors.