Simon C. Stölzle – University of Applied Sciences Kufstein, Finance, Accounting & Auditing through the “Crowdfunding Monitor” project and a bond trader at MGW Geld- und Wertpapiervermittlung, Raiffeisenallee 16, 82041 Oberhaching, Germany
Dominika P. Gałkiewicz – University of Applied Sciences Kufstein Tirol, Finance, Accounting & Auditing, Andreas Hofer-Str. 7, 6330 Kufstein, Austria




6th International Scientific-Business Conference – LIMEN 2020 – Leadership, Innovation, Management and Economics: Integrated Politics of Research – SELECTED PAPERS, Online/virtual, November 26, 2020, published by the Association of Economists and Managers of the Balkans, Belgrade; Printed by: SKRIPTA International, Belgrade, ISBN 978-86-80194-40-0, ISSN 2683-6149, DOI:



This study examines whether there is a negative green bond premium for investors in the secondary European market. To answer this question, the matched pairs method is applied, where the daily i-spreads of green bonds and the interpolated daily i-spreads of similar non-green bonds are compared. The bond sample contains 37 bond couples issued by corporations, financial institutions and governments between November 2019 and April 2020. The findings suggest that there is an average statistically significant negative very small green bond premium. The negative premium could be explained by investors’ preferences for green financial instruments leading to excess demand. The negative green bond premium may also be a compensation for the issuer’s external costs or reflect the internalization of environmental externalities. Further evidence shows that the negative green bond premium varies across industries and is not higher for lower rated investment grade bonds.



Green, Bond, Green finance, Premium, Europe.



Bachelet, M. J., Becchetti, L., & Manfredonia, S. (2019). The Green Bonds Premium Puzzle: The Role of Issuer Characteristics and Third-Party Verification. Sustainability, 11(4), 1098.
Berensmann, K., & Lindenberg, N. (2019). Green Finance: Across the Universe. In S. Boubaker & D. K. Nguyen (Eds.), Corporate Social Responsibility, Ethics and Sustainable Prosperity (pp. 305–332). WORLD SCIENTIFIC.

Boracheva, O., & Smorodinov, O. (2017). CHALLENGES TO GREEN FINANCE IN G20 COUNTRIES. World Economy and International Relations, 61(10), 16–24.
Bösch, M. (2020). Derivate: Verstehen, anwenden und bewerten (4. Auflage). München: Vahlen, Franz.
Boulle, B., Frandon-Martinet, C., & Pitt-Watson, J. (2016). Bonds and Climate Change. The State of the Market in 2016. Climate Bonds Initiative.
CBI (2020). 2019 Green Bond Market Summary. Retrieved from [05.05.2020]
Ceci, M. (2016). Green, Social and Sustainability Bonds. J.P. Morgan.
Dorfleitner, G., Halbritter, G., & Nguyen, M. (2015). Measuring the Level and Risk of Corporate Responsibility – An Empirical Comparison of Different ESG Rating Approaches. Journal of Asset Management, 16(7), 450–466.
Ehlers, T., & Packer, F. (2017). Green Bond Finance and Certification. Bank for International Settlements Quarterly Review. Retrieved from [15.05.2020]
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Hachenberg, B., & Schiereck, D. (2018). Are Green Bonds Priced Differently from Conventional Bonds? Journal of Asset Management, 19(6), 371–383.
Kahlenborn, W., Cochu, A., Georgiev, I., Eisinger, F., & Hogg, D. (2017). Defining “Green” in the Context of Green Finance: Final Report. Brussels: European Commission.
Karpf, A., & Mandel, A. (2018). The Changing Value of the ´Green´ Label on the US Municipal Bond Market. Nature Climate Change. (8), 161–165.
Ketterer, J. A., Andrade, G., Netto, M., Haro, & Isabel, M. (2019). Transforming Green Bond Markets: Using Financial Innovation and Technology to Expand Green Bond Issuance in Latin America and the Caribbean: Inter-American Development Bank.
Migliorelli, M., & Dessertine, P. (Eds.) (2020). Palgrave Studies in Impact Finance. The Rise of Green Finance in Europe: Opportunities and Challenges for Issuers, Investors and Marketplaces. Basingstoke: Palgrave Macmillan.
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Polbennikov, S., Desclée, A., Dynkin, L., & Maitra, A. (2016). ESG Ratings and Performance of Corporate Bonds. The Journal of Fixed Income, 26(1), 21–41.
Preclaw, R., & Bakshi, A. (2015). The Cost of Being Green. Barclays Credit Research. Retrieved from [01.06.2020]

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Zerbib, O. D. (2019). The Effect of Pro-Environmental Preferences on Bond Prices: Evidence from Green Bonds. Journal of Banking and Finance, 2019(98), 39–60.


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