Green halo - Revision history

imported>Doug Williamson: Add link.

2023-03-11T05:17:39Z

Add link.

← Older revision		Revision as of 05:17, 11 March 2023
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	* [[Green bond]]		* [[Green bond]]
	* [[Green curve]]		* [[Green curve]]
			* [[Green finance]]
	* [[Green gilt]]		* [[Green gilt]]
	* [[Greenium]]		* [[Greenium]]

imported>Doug Williamson: Layout.

2023-01-03T20:54:12Z

Layout.

← Older revision		Revision as of 20:54, 3 January 2023
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	:This hypothesized indirect effect is called the green halo...		:This hypothesized indirect effect is called the green halo...


	:The argument for issuing green bonds to capture a green halo can be situated within the theoretical context of signaling problems.		:The argument for issuing green bonds to capture a green halo can be situated within the theoretical context of signaling problems.

imported>Doug Williamson: Layout.

2023-01-03T20:53:49Z

Layout.

← Older revision		Revision as of 20:53, 3 January 2023
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	:This hypothesized indirect effect is called the green halo...		:This hypothesized indirect effect is called the green halo...

	:The argument for issuing green bonds to capture a green halo can be situated within the		:The argument for issuing green bonds to capture a green halo can be situated within the theoretical context of signaling problems.
	theoretical context of signaling problems.

	:Firms possess asymmetric information about their environmental credentials, such as future plans to reduce emissions. If this information is not or cannot be communicated effectively to investors with a preference for sustainability, firms may suffer from suboptimal costs of capital.		:Firms possess asymmetric information about their environmental credentials, such as future plans to reduce emissions. If this information is not or cannot be communicated effectively to investors with a preference for sustainability, firms may suffer from suboptimal costs of capital.

imported>Doug Williamson: Create page - source - Federal Reserve - https://www.federalreserve.gov/econres/ifdp/the-green-corporate-bond-issuance-premium.htm

2023-01-03T20:53:18Z

Create page - source - Federal Reserve - https://www.federalreserve.gov/econres/ifdp/the-green-corporate-bond-issuance-premium.htm

New page

''Sustainability - sustainable finance - pricing - cost of capital - halo effect.''

A green halo is a theoretical benefit enjoyed by an organisation or sector from green activity or signalling, outside the immediate scope of the activity itself.

For example, benefits resulting from related reputational improvements.

:<span style="color:#4B0082">'''''Green halo might lead to lower cost of capital for green bond issuers'''''</span>

:"...green bonds may provide additional indirect benefits for the issuer.

:For instance, by highlighting the environmental credentials of an issuer, green bonds offer a marketing benefit, potentially lowering the firm’s cost of capital by attracting new investors, or potentially improving business performance by attracting new customers.

:This hypothesized indirect effect is called the green halo...

:The argument for issuing green bonds to capture a green halo can be situated within the
theoretical context of signaling problems.

:Firms possess asymmetric information about their environmental credentials, such as future plans to reduce emissions. If this information is not or cannot be communicated effectively to investors with a preference for sustainability, firms may suffer from suboptimal costs of capital.

:Issuing a green bond may serve as a (potentially costly) solution to address the signaling problem and achieve a more optimal capital cost."

:''The Green Corporate Bond Issuance Premium - International Finance Discussion Papers 1346 - Board of Governors of the Federal Reserve System - 2022, p7-8.''

== See also ==
* [[Asymmetric information]]
* [[Bond]]
* [[Cost of capital]]
* [[Emissions]]
* [[Federal Reserve System]]
* [[Green]]
* [[Green bond]]
* [[Green curve]]
* [[Green gilt]]
* [[Greenium]]
* [[Halo effect]]
* [[Issuance]]
* [[Issuer]]
* [[Optimal capital structure]]
* [[Premium]]
* [[Reputational risk]]
* [[Signalling]]
* [[Sustainability]]
* [[Sustainable finance]]

==External link==

*[https://www.federalreserve.gov/econres/ifdp/the-green-corporate-bond-issuance-premium.htm Caramichael, John and Andreas Rapp (2022) - "The Green Corporate Bond Issuance Premium," International Finance Discussion Papers 1346. Washington: Board of Governors of the Federal Reserve System]

[[Category:Accounting,_tax_and_regulation]]
[[Category:The_business_context]]
[[Category:Ethics]]
[[Category:Identify_and_assess_risks]]
[[Category:Manage_risks]]
[[Category:Risk_frameworks]]
[[Category:Risk_reporting]]
[[Category:Financial_products_and_markets]]