Showing items 1 - 2 of 2

Your selections:

Does compliance to Green Bond Principles matter? Global Evidence

- Nanayakkara, Madurika, Colombage, Sisira

  • Authors: Nanayakkara, Madurika , Colombage, Sisira
  • Date: 2022
  • Type: Text , Journal article
  • Relation: Australasian Accounting, Business and Finance Journal Vol. 16, no. 3 (2022), p. 21-39
  • Full Text: false
  • Reviewed:
  • Description: We examine the effect of degree of compliance with the Green Bond Principles (GBP) on investor demand for such bonds, using cross-sectional data for all countries in the Green Bond market over the period 2007-2019. We find a significantly positive effect of higher compliance with the GBPs on investor demand, as measured by Bid-Ask-Spread and Yield-spread, after controlling for common bond-specific and macroeconomic variables. However, our results showed no evidence that macroeconomic factors influenced Green Bond investments. Moreover, we also find a positive effect on investor demand when a bond is issued by a government agency, even if the degree of compliance is low.3. © 2022 Australasian Accounting Business and Finance Journal and Authors.

Do investors in Green Bond market pay a premium? Global evidence

- Nanayakkara, Madurika, Colombage, Sisira

  • Authors: Nanayakkara, Madurika , Colombage, Sisira
  • Date: 2019
  • Type: Text , Journal article
  • Relation: Applied Economics Vol. 51, no. 40 (2019), p. 4425-4437
  • Full Text: false
  • Reviewed:
  • Description: We examine the pricing difference of Green Bonds (GB) and conventional bonds (CBs) in capital markets worldwide. Credit spread is used to observe whether investors would like to pay a premium for GBs over CBs. This study uses panel data regression with hybrid model to analyse daily observations over the period 2016 to 2017. We employ Option-Adjusted spread (OAS) to measure the credit spreads of bonds while controlling for bond specific, macroeconomic and global factors that influence the spread. With the hybrid model used in the panel data analysis, we were able to capture the fixed-effects of variables in a random effect model. We find that GBs are traded at a premium of 63 basis points (BPS), compared with a comparable corporate bond issue. We find that the green label provides issuers an incentive to raise funds through issuing GBs while providing investors an opportunity to diversify their investments returns. Our findings provide several implications to the major stakeholders driving the GB market to scale up the market to finance the required level of global green investment needs. We stress an urgent need to support the growth of the GB market to achieve sustainable development through mitigating climate change challenges. Abbreviation GB: Green Bond; CB: Conventional Bond; YS: Yield Spread; BPS: Basis Points; OAS: Option-Adjusted Spread; PCSE: Panels Corrected Standard Errors; CPI: Consumer Price Index; GBPs: Green Bond Principles; CBS: Climate Bond Standard.
  • 1