- Current survey among financial institutions: 89 percent of those surveyed are convinced that green bonds will play an important role in the refinancing of financial institutions in the future.
- Only 39 percent believe they are in a position to identify suitable assets and projects for Green Bonds transactions.
- The majority of participants (56 percent) admit that their own products and services lack ecological sustainability.
Zürich, April 15th 2019 - Green bonds are traded as a megatrend in the financial sector. However, financial institutions still have large deficits in these green bonds - especially in the performance of their own systems and in the products and services they offer. This is shown by BearingPoint's latest Green Bond Survey 2019*, a survey of experts working in financial institutions in German-speaking countries. The independent management and technology consultancy took the large number of first issues of Green Bonds on the German market as an opportunity for the current survey.
"The results of the Green Bond Survey 2019 show that the financial institutions surveyed have structural challenges and deficits. In the coming years, cost-efficient solutions will be needed to meet the high demand from investors," says Stefan Schütt, Partner responsible for Finance & Regulatory at BearingPoint.
The intention is there: great need for action to remedy existing deficits
Only 39 percent of respondents fully agree with the statement that sustainable items in the inventory management systems can be easily found. In addition, slightly more than half (56 percent) of the experts stated that their own institute's current product and service offering does not meet the requirements for future green emissions.
Why then do more and more financial institutions choose to issue green bonds? The vast majority of participants highlight external factors such as investor demand (83 percent), diversification aspects (83 percent) and marketing aspects (61 percent) of such an issue. 78 percent of the participants even see the green bonds as an elementary component of the company-wide sustainability strategy and the social responsibility of their own company towards society.
Green Bonds as a key component of the refinancing mix of financial institutions
"With annual double-digit growth rates, the market for sustainable financial investments has evolved from a niche phenomenon to a mass investment market. The green bond segment in particular has been growing disproportionately for years," says Marc von Scheliha, Senior Manager and responsible for Sustainable Finance at BearingPoint. 89 percent of respondents are therefore convinced that green bonds will be an essential part of the refinancing mix of their own institution in the future. In addition, 78 percent confirmed that the financial institutions also accept the increased complexity of the issuing process compared to conventional bonds.
According to Marco Kundert, Partner at BearingPoint Switzerland, Green Bonds have many advantages.
The trend towards sustainable finance investments and products will have far-reaching consequences for the financial industry beyond asset management. I am thinking in particular of the entire advisory process, including onboarding, client classification and reporting.
Marco Kundert, Partner at BearingPoint
"For BearingPoint, the consideration of environmental and social sustainability aspects is an essential element of a viable future strategy, especially for the financial industry, which is repeatedly plagued by scandals," says Stefan Schütt. "This Green Bond study fits seamlessly into our approach to further sharpening our advisory profile for sustainable finance. As BearingPoint, we build not only on our strategic perspective, but above all on our regulatory expertise. Last but not least, the European Union's Action Plan for Sustainable Finance shows that we are on the right track," says financial expert Schütt.
About Green Bonds
Green Bonds are bonds issued by banks, companies or public institutions that are intended to offer a sustainability-oriented investor climate-related investment opportunities. Green bonds have the same characteristics as conventional bonds, with the difference that the proceeds from the bond may only be used to (re-)finance projects that offer clear climate-related solutions and have a positive impact on the environment. The selection of eligible green projects is broad and includes in particular renewable energies, energy efficiency and measures to reduce CO2 emissions.
*About the Green Bond Market Survey 2019
From January 24 to February 24, 2019, BearingPoint conducted a market survey among experts from 15 financial institutions in German-speaking countries on the importance of green bonds for financial institutions. The study results were summarized under the title Quo vadis Green Bond - Results from the BearingPoint Green Bond Survey 2019. Click here to request a presentation of the results: sustainablefinance@bearingpoint.com.
About BearingPoint
BearingPoint is an independent management and technology consultancy with European roots and a global reach. The company operates in four units: Consulting, Solutions, Business Services, and Ventures. Consulting covers the advisory business; Solutions provides the tools for successful digital transformation, advanced analytics and regulatory requirements; Business Services provides managed services beyond SaaS; Ventures drives the financing and development of start-ups. BearingPoint’s clients include many of the world’s leading companies and organizations. The firm has a global consulting network with more than 10,000 people and supports clients in over 75 countries, engaging with them to achieve measurable and sustainable success.
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Svenja HubliAnalystSwitzerland
