Green Finance and SDGs: Emerging Trends in the Design of Green Investment Portfolios

Alessandro Rizzello ()
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Alessandro Rizzello: University “Magna Græcia” of Catanzaro

Chapter Chapter 4 in Green Investing, 2022, pp 85-105 from Palgrave Macmillan

Abstract: Abstract This chapter explores the evolution in the design of green portfolios in the financial industry. The green portfolio targets environmental returns, such as reducing the effects of climate change through low-carbon initiatives, making resources more efficient, and minimizing pollution. The alignment strategies for these kinds of non-financial returns assume different forms, increasingly subject to regulation from legal and financial authorities. Within this context, portfolios of investments closely aligned to the United Nations Sustainable Development Goals (SDGs), in particular to SDG Green Themes, are registering rapid growth. A growing number of sustainability portfolios target environment-related UN SDGs, such as clean water and sanitation (SDG 8), climate action (SDG 13), and affordable and clean energy (SDG 7). In addition, the simultaneous pressures for transparency in the green alignment, deriving from the adoption of recent legislative and regulatory standards in this field, are forcing financial actors to adopt more standardized and compliant solutions for their green portfolio strategies. This chapter gives an overview of the most important strategies adopted in designing green portfolios in the financial industry, and describes the role of the financial intermediation chain in terms of both opportunities and emerging trends.

Keywords: Green Finance; Green Investing; ESG Investing; SDG Investing; Portfolio alignment (search for similar items in EconPapers)
Date: 2022
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DOI: 10.1007/978-3-031-08031-9_4

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