E. Derry Hubbard, global head of debt capital markets for Danske Bank, says investors generally prefer products that explicitly finance sustainable projects, which green bonds do. Sustainability-linked bonds, known as SLBs, are growing fast as a debt class, but are still perceived as less transparent and therefore riskier, he said.
Ultimately, the goals that SLB issuers commit to are "not as defined as-use-of proceeds", which is a feature of green bonds but not of sustainability-linked debt, Hubbard said.
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