Croatan Institute Releases Green Bonds Report with Clean Energy Group and Confluence Philanthropy

June 23, 2015

Today, Clean Energy Group, Confluence Philanthropy, and Croatan Institute jointly release the first ever study on the role of green bonds in foundation portfolios. The report, Fixed Income Investing in Climate Solutions: Green Bond Opportunities for Philanthropic Foundations focuses on the growing market for green bonds and their potential role as a component of a fossil-free investment strategy for the increasing numbers of foundations committing to divest from fossil fuels.

The report provides an overview on green bonds, the projects they finance, the challenges the market is facing, and the opportunities for foundations to support the market as it rapidly takes off. It builds upon a broader, year-long inquiry conducted by Clean Energy Group and Croatan Institute into the nature of institutional investor demand for green bonds, which involved consultations with more than 50 investors, portfolio managers, foundation officers, underwriters, and other experts in the field, including at a side event to the United Nations Climate Summit held at the Surdna Foundation in September 2014.

“With this study, we have identified numerous ways that green bonds can fit into an integrated philanthropic investment strategy — as mission-related investments, place-based investments, program-related investments, or as part of a Divest-Invest strategy,” according to Joshua Humphreys, president and senior fellow at Croatan Institute and a lead author of the study.

Green bonds are similar to traditional fixed-income products, but are used to finance environmentally beneficial projects, including renewable energy generation and conservation, green building, and clean water infrastructure. Because green bonds have similar investment characteristics to other bonds, they can readily be integrated into foundation portfolios. The financial risks and opportunities associated with climate change and resource constraints make green bonds compelling investment opportunities for any foundation.

Joshua Humphreys will present the findings of the paper on a webinar, titled Greening Your Portfolio: Understanding the Opportunities & Risks of Green Bonds, hosted by Confluence Philanthropy on July 1st, 2015. Along with Confluence Philanthropy, it is co-sponsored by Divest-Invest Philanthropy and Croatan Institute. Please note that only funders and investment advisors are eligible to attend. Details available here.

You can read the full report at http://croataninstitute.org/total-portfolio/publication/fixed-income-investing-in-climate-solutions.

The official press release can be viewed here.