A review of innovative bond instruments for sustainable development in Asia

Title

A review of innovative bond instruments for sustainable development in Asia

Creator

Prakash N.; Sethi M.

Description

Purpose: Advancing the economies in Asia toward meeting sustainable development goals (SDGs) needs an unprecedented investment in people, processes and the planet. The participation of the private sector is necessary to bridge the financing gap to attain this objective. Engaging the private sector can contribute significantly to attaining the 2030 agenda for SD. However, the financial markets in Asian economies are yet to realize this potential. In this context, this paper aims to discuss the state of finance for SD in Asia and identifies innovative financial instruments for attracting private investments for SDs in these economies. Design/methodology/approach: This study relies on published articles, reports and policy documents on financing mechanisms for SD. The literature review covered journal data sources, reports from global institutions such as the UN, World Bank, International Monetary Fund and think-tanks operating in the field of climate change policies. Though the topic was specific to financial market instruments, a broader search was conducted to understand the different sources of sustainable finance available, particularly in Asia. Findings: The investments that are required for meeting the SDGs remain underfunded. Though interest in sustainability is growing in the Asian economies, the financial markets are yet to transition to tap the growing interest in sustainable investing among global investors. This paper concludes that to raise capital from private investors the Asian economies should ensure information availability, reduce distortions and unblock regulatory obstacles. It would also need designing policies and introducing blended financing instruments combining private and public funds. Research limitations/implications: Though the study has grouped Asian economies, the financing strategy for SDGs should be developed at the country-level considering the domestic financial markets, local developmental stage, fiscal capacity and nationally determined contributions. Further research can focus on developing country-specific strategies for using innovative financial instruments. Originality/value: Mobilizing funds for implementing the 2030 Agenda for SD is a major challenge for Asian economies. The paper is addressed to national policymakers in Asian economies for developing strategies to raise capital for SD through private participation. It provides opportunities for revisiting national approaches to sustainable finance in these economies. 2021, Emerald Publishing Limited.

Source

International Journal of Innovation Science, Vol-14, No. 45750, pp. 630-647.

Date

2022-01-01

Publisher

Emerald Publishing

Subject

Green bond; Green financing; Social bond; Sustainability bond; Sustainable finance

Coverage

Prakash N., Symbiosis International University, Pune, India, Christ University, Bangalore, India; Sethi M., Symbiosis Institute of Business Management, Symbiosis International University Symbiosis Bengaluru, Bangalore, India

Rights

Restricted Access

Relation

ISSN: 17572223

Format

Online

Language

English

Type

Article

Identifier

https://doi.org/10.1108/IJIS-10-2020-0213

https://www.scopus.com/inward/record.uri?eid=2-s2.0-85106226609&doi=10.1108%2fIJIS-10-2020-0213&partnerID=40&md5=3edfd0fa12c1664e71d295130a149728