Abstract

Growing global recognition of the urgency posed by climate change demands strategies balancing economic growth and ecological sustainability. To limit global warming below 2°C, international accords like the UN's Sustainable Development Goals (SDGs) and the Paris Agreement have set the standards for greener economies. ESG investments are becoming a popular trend in the financial world, embracing climate change and other sustainability concerns across different asset classes. Green bonds in particular are driving the green finance movement, with issuance leaders like the US and China. The size of the green bond market is expected to surpass the trillion-dollar threshold by 2023. Instruments like green bonds can bridge the funding gap for a net zero economy. Financial engineering can develop appealing financial products guided by investment practices focused on sustainability goals. Despite challenges, tax policies and fiscal measures can boost green investment participation and returns, pushing toward a greener future.

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