Performance of Green Bonds in Emerging Capital Markets: An Analysis of Academic Contributions

Abstract

The ongoing experience of the global transition from fossil fuel-based economies to renewable-fuel-based economies shows that sustainable finance is an important step that enables this transformation in developed and emerging capital markets. As such, understanding the performance drivers of green bonds becomes important for development of new corporate models based on sustainability goals. Our research presents a systematic literature review on financial and non-financial drivers of performance of green bonds in the emerging capital markets. Using a unique hybrid technique for textual analysis of articles published between 2010 and 2022, we propose to identify the main research clusters (renewable energies, investments, climate change and sustainable development, green bonds, and green finance) and the most representative emerging capital markets to consider in terms of assessing new trends. Future research directions may be devised based on the trends of the keywords which are created herein using information extracted from the ‘Scopus’ application, processed with ‘VOSviewer’, and structured using ‘Online Analytical Processing’ (OLAP) principles with the help of ‘Visual Basic for Applications’ (VBA) programming through spreadsheets. Our results demonstrate that non-financial performance factors are more influential in emerging capital markets because of the early stage of development of green bonds issuance, and because of the reduced regulatory framework regarding green financing.