Australia in June issued a green bond in support of the sovereign’s climate goals. However, the government has since elected to extend the life of several coal mines, placing these goals in jeopardy and tarnishing the green bond, which has underperformed since issuance.
Austria’s new parliament, where a climate-sceptic party holds the balance of power, threatens to weaken the country’s already insufficient climate policies and undermine the impact of its own green bonds.
Meanwhile, Alberta’s strong backing of oil, gas, and tar sands clashes with the ESG commitments of funds that supported its recent EUR-denominated bond sale.
This research note unpacks the distinct climate-financial risks that each of these issuers could bring to unwary investors, and serves as a reminder that corporate bonds are not the only instruments that should be scrutinised by climate-aware asset owners.
