The Increasing Importance of Green Bonds as Instruments of Impact Investing -towards a New European Standardization

This chapter examines the rapid growth of the green bond market in Europe and its role as a targeted impact investing tool for environmental and social governance (ESG) objectives. It highlights key challenges, including inconsistent definitions of what qualifies as “green” and the proliferation of diverse assessment frameworks. The author argues for a unified European standard—specifically the EU Green Bond Standard—to enhance clarity, transparency, and investor confidence. By analysing current instrument characteristics and regulatory gaps, the chapter advocates standardisation to responsibly align capital flows with sustainable development goals.