Green Finance from A to Z (Part 3/3)

You were waiting for it? We did it!
The final part of our ecological finance trilogy is now available on L’Empreinte! In this article, discover the vocabulary of green finance from the letter O to T. After that, you’ll be an expert!

→ Also read: Responsible finance from A to Z (Part 1/3)

Bond

A bond is a debt security issued by a company or a government. When a company or a state seeks funds to finance its projects, it may need several lenders. You can become one of these lenders by purchasing a bond, which represents a share of this debt. In addition to repaying the invested amount on a predetermined date, the issuer commits to paying you interest regularly at a fixed or variable rate, as defined in the terms and conditions of the bond issuance.

→ Also read: Investing in bonds: characteristics, valuation and returns

Blue bond

A blue bond is a borrowing instrument from the field of green finance. Issued by governments, development banks or other institutions, a blue bond aims to finance projects that protect marine ecosystems, seas and oceans. It contributes to the achievement of SDG 14: “Conserve and sustainably use the oceans, seas and marine resources.”

Green bond

What is a green bond?
In the world of green finance, it is a bond designed to raise funds for climate and environmental projects. Issued on the market by a company or a public entity to investors, it enables the financing of projects that contribute to the ecological transition, such as sustainable waste management or clean transportation.

Undertaking for Collective Investment in Transferable Securities (UCITS)

This is a financial structure that pools funds from individual investors. Why? To invest them in a diversified range of transferable securities. What does that mean? Shares, bonds, money market instruments, and more.

Retirement Savings Plan (PER)

Bringing together several existing retirement savings schemes, the PER aims to simplify and unify the retirement savings landscape. Available since October 1, 2019, it allows you to build additional income for retirement. You can withdraw it either as a life annuity or as a lump sum, depending on the terms of your contract.

Private equity

Also known as private equity investment, this involves investing funds in companies that are not publicly listed. It can take various forms, such as venture capital for startups, growth capital for expanding companies, and leveraged buyouts for acquiring existing businesses using financial leverage.

Sustainable Finance Disclosure Regulation (SFDR)

Effective since March 2021, the SFDR aims to improve transparency in green finance by providing investors with information on how asset managers integrate sustainability factors into their investment processes. In other words, each financial services provider must explain how it incorporates environmental, social and governance (ESG) criteria into its activities.

European taxonomy

Did you know?

• €1,000 billion will need to be mobilized between 2021 and 2027 to achieve the low-carbon transition of the 27 EU Member States.
• By 2050, the European Union aims to achieve climate neutrality, or “net zero.”

The European taxonomy is a classification system for economic activities. What for? To determine the extent to which they contribute to sustainable environmental objectives. In practice, it defines precise technical criteria to assess whether an economic activity can be considered environmentally sustainable, taking into account PAIs (Principal Adverse Impacts), which are a practical application of the “Do No Significant Harm” (DNSH) principle. The European taxonomy is based on the SFDR regulation.

Just transition

You may be familiar with the ecological transition, but what about the just transition? It refers to a type of transition grounded in equality. What does that mean? It must not take place at the expense of the most vulnerable populations, who bear economic costs and energy poverty, nor at the expense of workers in polluting sectors whose jobs are likely to disappear over time.

With the aim of making your impact positive and meaningful, Enerfip invites you to invest in the energy transition directly through renewable energy production projects, energy efficiency initiatives or sustainable mobility solutions. High-performing, diversified and closely connected to projects and project developers, our offerings actively contribute to promoting a low-carbon societal model while offering attractive financial returns.

If you are interested in green finance, don’t wait any longer—book an appointment with our Investor Relations team today!