| Abstract [eng] |
The Master Thesis explores the phenomenon of greenium – a premium associated with green bonds that results in lower yields compared to conventional bonds. The study examines its implications for corporate and government financing, analysing whether green bond issuance, in the product of greenium, reduces the cost of capital and enhances market valuation. The thesis consists of three parts: a literature review, empirical analysis, and conclusions with recommendations. The primary objective is to investigate whether green bonds provide financial advantages by lowering borrowing costs for issuers. The research methodology involves yield curve analysis of green and conventional bonds issued by the same entities in Europe during 2023. Polynomial regression is employed to construct yield curves, and case studies are used to assess yield dynamics at issuance and over time (7 and 30 days post-issuance). Key findings indicate reveal that the existence and magnitude of greenium are not as straightforward as often perceived. While some evidence suggests green bonds may yield lower costs for issuers compared to conventional bonds, the results vary significantly depending on the issuer type, market conditions, and bond characteristics. These findings challenge the notion of a universal greenium and underscore the complexity of assessing its financial benefits for issuers. The study emphasizes that while green bonds can enhance reputational value and attract ESG-focused investors, their financial advantages are context-dependent and subject to market-specific dynamics. The thesis contributes to sustainable finance literature by providing empirical evidence on greenium dynamics and highlighting the need for standardized evaluation frameworks for green bonds. It also addresses challenges like greenwashing, emphasizing transparency in reporting. Recommendations include enhancing regulatory frameworks to support green bond markets, promoting issuer transparency to maintain investor trust, and encouraging further research into regional variations in greenium behavior. This work underscores the growing importance of green bonds as tool for sustainable development while offering actionable insights for policymakers, investors, and corporate leaders. |
