A conceptual framework for development of Ukraine’s green stock market

Abstract

The article considers the key drivers for boosting the green stock market in Ukraine. The latest development trends of the world green stock market are highlighted. Based on the analysis of national regulatory framework for stock market and foreign practice of developing the green stock market, essential mechanisms of the green stock market functioning are identitifed. After an in-depth review of contemporary research papers, an assumption is made that the green stock market is a set of specialized institutions which form a platform for the permanent circulation of green securities (issue, purchase and sale). It is emphasized that the green stock market should promote the circulation and efficient allocation of green financial resources, provide an opportunity to independently assess ecological and economic efficiency of entities, create conditions for fair competition in the market. Green finance is viewed as financial resources aimed at implementing green targets (mitigation of climate change, alternative energy use, clean technologies, energy- efficient (green) projects, etc.). The article determines the main goals and functions of the green stock market and systematizes principles of its functioning. It is concluded that the basic principles for boosting the green stock market include: compliance with the goals of sustainable development; social justice; protection of investors; regulation; monitoring; legal regulation; transparency. In order to ensure compliance with the transparency principle of the green stock market, it is necessary to develop a mechanism for identification, classification and accounting of green assets, according to which an appropriate classification of green financial resources can be developed. The article also describes the key players and their role in the development of the green stock market as an integral part of green finance. The findings confirm that the development of green securities (green bonds in particular) and green stock indices are the key drivers for boosting the green stock market.