Is Green Finance a Myth or a Truth?

Mohamed Bechir Chenguel

Chapter 12 in Green Finance and Sustainable Development Goals, 2024, pp 317-335 from World Scientific Publishing Co. Pte. Ltd.

Abstract: The issue of addressing climate change aims to reduce greenhouse gas emissions. Green finance was created to reduce the negative impact of climate change. Green finance has used financial instruments like green bonds to finance projects for the good of the environment and the planet. After almost 10 years, with the persistence of global warming and climate change manifested by melting glaciers, droughts, and floods, all of these factors have called into question the efficiency of green finance. This chapter presents green finance and its instruments, and our contribution is to shed light on the aspects that may limit its effectiveness, such as the absence of incentives and, above all, the absence of green finance standards. In addition, we reveal that potential crises can arise in banks if they opt to finance green investments and abandon fossil fuel activities. All of these factors make the concept of green finance just an illusion.

Keywords: Green Finance; Financial Development; ESG Performance; Climate Change; Climate-Vulnerable Asian Countries; Environmental Disclosure in Financial Institutions; Environmental; Social; and Governance Issues in Corporate Valuation; Financing Renewable Energy; Gross Ecosystem Product; Green Banking Disclosures; Climate-Related Risks; Green Banking Disclosures; Development and Impact Analysis (search for similar items in EconPapers)
JEL-codes: Q01 Q5 Q56 (search for similar items in EconPapers)
Date: 2024
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