Unlocking Green Bonds – AFM&'s Latest Views

Countering greenwashing is important for all market participants. This is true for issuers, for investors, but also for banks arranging an issuance. To avoid greenwashing or, the opposite, "green-bleaching" (i.e. the practice of market participants to not describe sustainability features in order to reduce the risk of liability due to greenwashing), claims relating to ESG characteristics, objectives and/or ESG statistics in legal documents or commercial information is at its core about ensuring that these expressions are consistent with actual product characteristics.

In the absence of special rules or regulations on green bonds in the Prospectus Regulation, the Dutch regulator, the Authority for the Financial Markets (AFM), recently stipulated a number of expectations in the context of prospectus supervision to counter the risk of greenwashing as much as possible.