This chapter analyses the trends in the issuance and outstanding amounts of sustainable bonds since 2015. It also looks at the most common use of proceeds, key performance indicators for sustainability-linked bonds, the maturity profiles of sustainable bonds, and analyses the main characteristics of sustainable bond issuers and standards and taxonomies used globally.
Sustainable Bonds
Trends and Policy Recommendations
Abstract
Sustainable bonds can be classified into two major categories (ICMA, 2022[1]). “Use-of-proceeds bonds” are bonds whose proceeds should be used to either partially or fully finance or re‑finance new or existing eligible green, social or sustainable projects. In the case of “use-of-proceeds bonds” issued by financial institutions, the proceeds are typically allocated to finance or refinance the provision of loans for the development of eligible projects. “Sustainability-linked bonds” (SLBs) are bonds for which the issuer’s financing costs or other characteristics of the bond (e.g. its maturity) can vary depending on whether the issuer meets specific sustainability performance targets within a timeline, but whose proceeds do not need to be invested in projects with an expected positive environmental or social impact.
The “use-of-proceeds bonds” include green, social and sustainability bonds. The proceeds of green bonds must be applied to finance projects with expected environmental benefits, which may include, for instance, projects in renewable energy, clean transportation, biodiversity conservation, and wastewater management (ICMA, 2021[2]). In this classification, “blue bonds” and “climate bonds”, which focus on environmental issues related to the sea and climate change, respectively, would be classified as “green bonds”. The resources raised through social bonds must be invested in projects that aim to address or mitigate a specific social issue or seek to achieve positive social outcomes, including affordable housing, food security and the empowerment of minorities (ICMA, 2023[3]). Sustainability bonds are bonds where proceeds should be used to finance a combination of both green and social eligible projects.
Over the past five years, sustainable bonds have become a more important source of capital market financing for both the corporate and official sectors (the latter category includes national and subnational governments and their agencies, as well as multilateral institutions). Globally, companies issued USD 522 billion in sustainable bonds in 2024, while the official sector issued USD 473 billion. The total amount issued through corporate sustainable bonds was four times larger in 2020‑2024 than in 2015‑2019. Meanwhile, the amount issued by the official sector in the last five years was five times larger compared to 2015‑2019.
In 2021, a record amount of USD 728 billion was issued by corporates, of which 58% was issued by non‑financial companies (Figure 2.1, Panel A). Corporate issuance fell slightly in the following two years, only to rebound in 2024, when it increased by 3% compared to the previous year.
Sustainable bonds issued by the official sector reached record amounts in 2020 and 2021, with total issuance of USD 462 billion and USD 508 billion, respectively (Figure 2.1, Panel B). In 2020, multilateral institutions issued almost USD 230 billion in sustainable bonds. In 2023, corporate sustainable bond issuance decreased by 30% compared to 2021, and the official sector experienced a similar decrease.
Global sustainable bond issuances have increased sharply since 2020, in both the corporate and the official sector
Note: In Panel B, agencies and local governments include national government agencies (e.g. KFW), local governments (e.g. Prefecture of Shiga in Japan), and national development banks (e.g. Brazilian National Development Bank). The category Multilateral Institutions includes organisations formed by three or more jurisdictions (e.g. International Finance Corporation), and the European Union. The inflation adjustment of the issued amounts over the year is measured by the Consumer Price Index (CPI).
Source: OECD Corporate Sustainability dataset, LSEG.
In 2024, the outstanding amount of sustainable bonds issued by the corporate sector totalled USD 2.4 trillion, against USD 2.2 trillion by the official sector. The outstanding amount of sustainable bonds issued by the non‑financial corporate sector accounted for USD 1 295 billion, representing 8% of the total outstanding amount of bonds issued in the sector. Financial companies’ outstanding amount of corporate bonds totalled USD 1 121 billion, which is 6% of the outstanding amount of all corporate bonds issued by financial companies (Figure 2.2, Panel A).
For the official sector, the outstanding amount of sustainable bonds reached USD 891 billion for agencies and local governments, USD 718 billion for multilateral institutions and USD 612 billion for central governments in 2024 (Figure 2.2, Panel B). Multilateral institutions are the biggest issuers of sustainable bonds in the official sector, with their share representing 34% of total issuances. In contrast, sustainable bonds represent 8% of the outstanding bonds from agencies and local governments, whereas only 1% of bonds issued by central governments are labelled as sustainable.
Multilateral institutions are the most active issuers of sustainable bonds, with 34% of all outstanding bonds
Source: OECD Corporate Sustainability dataset, LSEG.
Europe has been the most active region in terms of sustainable bond issuances in both the corporate and official sectors. From 2015 to 2024, 45% of the global amount issued through non-financial corporate sustainable bonds was raised by European companies. China and the United States follow with 17% and 13%, respectively. Europe also dominates the issuance of sustainable bonds by financial corporates with 54%, followed by Developed Asia-Pacific excl. US (16%), China (15%), and the United States (7%) (Figure 2.3, Panel A). In the official sector, sustainable bonds issued by central governments have been mainly issued by European countries (65% of global issuance by central governments in 2015‑2024), followed by Latin American Governments (15%). Issuance by agencies and local governments is also dominated by European issuers (62% of the global amount), followed by issuers in Developed Asia-Pacific excl. US (17%) (Figure 2.3, Panel B).
Corporate sustainable bonds in Europe account for half of global sustainable issuances
Source: OECD Corporate Sustainability dataset, LSEG.
Green bonds were the most important type of sustainable bonds issued in 2024, both for the corporate and the official sector with, respectively, USD 382 billion and USD 257 billion (Figure 2.4).
While corporate green bonds accounted for almost all sustainable issuance before 2020 (92% on average), other types of sustainable bonds have gained in importance in the last five years. In particular, SLBs, issued for the first time in 2019, reached an average of 10% of total sustainable issuances between 2020 and 2024. In 2024, social, sustainability and sustainability-linked bonds averaged 9%, 11% and 7% of all corporate sustainable issuances, respectively. After a record issuance of SLBs in 2021 (USD 115 billion), the prominence of these instruments has declined in global corporate issuances, with only USD 35 billion issued in 2024.
The issuance of green bonds is less prevalent in the official sector, representing about half of the amount issued over the last three years. Governments and multilateral institutions have commonly used social (22%) and sustainability (26%) bonds over the last three years (Figure 2.4, Panel B). Official sector SLBs were issued for the first time in 2022, making up only 1% of the share of sustainable bonds issued in the last two years.
Green bonds are the most widely used type of sustainable bond globally
Source: OECD Corporate Sustainability dataset, LSEG.
In Table 2.1, the categories of “use of proceeds” in GSS bonds are ranked by their importance for each issuer type. The analysis is based on the targeted destination of the proceeds, as established in the GSS bond documentation. “Eligible green projects” and “General purpose” categories are considered separately, as they effectively present an open investment scope, and, thus, not a sustainability-related specific purpose. The first one is commonly disclosed for GSS bonds issued by non-financial corporates, while GSS bonds with a general purpose use of the proceeds are issued by 9% of multilateral institutions.
“Clean energy” (21% of the total issued amount) and “green buildings” (16%) rank first among GSS bonds issued by financial and non-financial corporates, respectively. “Energy efficiency” and “clean transportation” projects are also often indicated as eligible categories for corporate GSS bonds’ use of proceeds.
“Social expenditures” was the preferred use of proceeds for agencies and local governments and multilateral institutions between 2015 and 2024. Additionally, “biodiversity conservation”, “energy efficiency” and “clean transportation” are the top 3 priorities in central governments’ issuance of GSS bonds, with 20%, 12% and 11% of the total amount raised, respectively.
Energy-related projects received the largest share of corporate financing through sustainable bonds
Note: The table is built from the categories of use of the proceeds disclosed by the issuer before or at the time of the issuance. When more than one category is disclosed for a single issuance, a flat allocation of the issued amount of each GSS bond is applied.
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Source: OECD Corporate Sustainability dataset, LSEG.
An analysis of bonds designating “general purpose” as the sole eligible use of proceeds reveals that USD 83 billion of GSS bonds fell under this category between 2015 and 2024 (Figure 2.5). Bonds that listed “general purpose” as a use of proceeds category alongside one other accounted for USD 90 billion of total issuance. Considering a flat allocation, half of this amount was allocated to general-purpose projects, lacking a specific sustainability objective. An additional USD 113 billion was raised in bonds with “general purpose” as one of three eligible categories (USD 38 billion was allocated to general purpose, assuming a flat allocation). Other issuers disclose a “general purpose” within a longer list of eligible projects.
According to the ICMA, a GSS bond enables capital-raising and investment for new and existing projects with environmental, social or a combination of both green and social benefits. As discussed, the “general purpose” category does not align well with this definition, allowing instead for a broader and non-project-driven allocation of the proceeds. Nevertheless, among the GSS bonds in the sample that disclose a general purpose use of proceeds, most of them state an alignment with the ICMA Principles. Notably, non-financial issuers disclosed alignment with the ICMA Principles for 71% of their general purpose GSS bonds, financial issuers for 80%, agencies and local governments for 96%, central governments for 74% and multilateral institutions for 93%.
Alignment with standards and principles is generally enforced by a pre‑issuance verification (“second party opinion”), which plays a key role in ensuring investor transparency on the future destination of the raised funds. Second party opinion providers assured half of the general-purpose GSS bonds in the corporate sector and around two‑thirds of bonds issued by agencies and local governments and central governments. For multilateral institutions, only 17% of these bonds received a second party opinion. Figure 2.5 displays the shares of GSS bonds that include “general purpose” among the eligible use of proceeds categories, broken down by type of issuer. Additionally, it illustrates the proportion of these bonds that disclosed alignment with the ICMA Principles and the proportion that were verified by a second party opinion provider.
Most bonds with an open investment scope claim ICMA alignment, often verified by a second party opinion provider
Note: The figure shows the shares of the amount of bonds issued with general purpose use of proceeds that disclose alignment with the ICMA Principles or the pre‑issuance assurance by a second party opinion provider. The blue bar represents the share of GSS bonds issued between 2015 and 2024 that include “general purpose” as an eligible category. The purple bar indicates the share of these bonds that align with the ICMA Principles, while the green bar reflects the share of bonds that have received a second-party opinion.
Source: OECD Corporate Sustainability dataset, LSEG.
SLBs include specific sustainability performance targets to be met within a defined timeline. To this end, key performance indicators (KPIs) are selected by the SLB issuer to achieve the sustainability objectives at the entity level. As shown in Table 2.2, most of the KPIs in SLBs relate to climate transition, such as “Scope 1 and Scope 2 GHG emissions”, accounting for 28% of the SLBs issued by corporates, or “Carbon intensity” (24%), and “Renewable energy” (8%). Although less frequently, non‑climate transition KPIs were also mentioned for some corporate SLBs, such as “Women Board Members” (1.4%). The KPIs of SLBs issued by the official sector are also included in the table, but only very few have been issued so far, which limits the comparability between the numbers for the corporate and official sectors.
From 2015 to 2024, almost 80% of sustainable corporate bonds were issued with a medium-term maturity – ranging from 2 to 10 years. Short-term corporate sustainable bonds (with a maturity of less than two years) represented only a fractional amount, accounting for only 3% of the corporate sustainable bonds in 2024. The official sector has issued sustainable bonds with longer maturities than the ones issued by the corporate sector. While in 2024 long-term bonds accounted for 18% of the total amount issued by the corporate sector, long-term bonds by the official sector amounted to 36% (Figure 2.6).
Globally, companies primarily link the financial characteristics of SLBs to their climate performance
Note: The table is based on the disclosure of sustainable KPIs reported by the issuer before or at the time of the issuance. When more than one KPI is disclosed for a single issuance, a flat allocation of the amount issued for each SLB is applied.
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Source: OECD Corporate Sustainability dataset, LSEG.
Sustainable bond issuers have shown a preference for medium-term issuances over the past decade
Note: Bonds with maturities less than 1‑month maturity are excluded.
Source: OECD Corporate Sustainability dataset, LSEG.
Since 2015, sustainable bonds issued by corporates and by governments and multilateral institutions have displayed less stable value weighted maturities when compared to all conventional and sustainable bonds. On average, sustainable bonds issued by nonfinancial corporates present a value weighted maturity of 12.3 years against a maturity of 9.4 years for all bonds issued by nonfinancial corporates (Figure 2.7, Panel A). This gap is smaller in the financial sector, where sustainable bonds present on average a slightly shorter value weighted maturity of 6 years against 6.9 years for all bonds.
Multilateral institutions show the same maturity (8.2 years) for both sustainable and all bonds, whereas agencies and local governments’ value weighted maturity averages 8.5 years for sustainable bonds and 10.1 years for all bonds (Figure 2.7, Panel B). For central governments, the value weighted maturity of sustainable bonds was almost double that of all bonds issued since 2017, averaging 16.5 years against 8.7 years, respectively.
Sustainable bonds exhibit greater volatility in value‑weighted maturity compared to the entire bond market
Note: Bonds with maturities less than 1‑year maturity are excluded.
Source: OECD Corporate Sustainability dataset, LSEG.
Between 2015 and 2024, 46% of the total corporate sector issuance of GSS bonds included a call option, allowing the issuer to redeem the bond before maturity (Figure 2.8, Panel A). This option was included in a significant portion of SLBs issued by corporates (79%) (Figure 2.8, Panel B).
A similar trend is also visible for the official sector. While 47% of the amount of SLBs issued by official sector entities included a call option, only 4% of GSS bonds included such an option. The existence of a call option in SLBs may be a cause for concern, as issuers could, by exercising the call option, seek to reduce the amount of any penalty that could arise from not meeting the sustainability performance targets. The establishment of a penalty if targets are not met at the time of exercising the call option can potentially mitigate that concern. Ul Haq and Doumbia (Ul Haq and Doumbia, 2022[4]) analysed 40 SLBs with a call option (up to December 2021) and found that 42.5% displayed mentioned penalty if the targets are not met at the time of the call.
Call options in SLBs may allow issuers to limit penalties for missing sustainability targets
Source: OECD Corporate Sustainability dataset, LSEG.
2.2.1. Corporate sector
Corporate issuance of social and sustainability bonds increased significantly between 2023 and 2024 (by 30% and 28%, respectively). In contrast, the issuance of SLBs declined, particularly in the non-financial sector, where issuances decreased by one‑third. Additionally, if green bond issuance by non-financial companies increased by 20%, it declined among financial issuers, falling 12% below the 2023 level (Figure 2.9, Panel A).
In 2015, sustainable bonds accounted for only 0.6% of the total issuance of all non-financial bonds. By 2024, this share had risen to 11%, after peaking at 16% in 2022. A similar upward trend was observed among financial companies, where the proportion of corporate sustainable issuance over all bonds jumped from 0.6% in 2015 to 7% in 2024.
Sustainable corporate bond issuances increased from less than 1% of financial bonds in 2015 to 7% in 2024
Source: OECD Corporate Sustainability dataset, LSEG.
Globally, sustainable non‑financial corporate bonds accounted for 11% of all corporate bond issuance over the 2020‑2024 period, and financial corporate bonds for 7%. Sustainable bonds represent a larger share of all corporate bond issuances in some regions, including Developed Asia-Pacific excl. US, Latin America, Europe, and the Middle East and Africa. Conversely, in China, the United States and Emerging and Developing Asia excl. China, sustainable bonds have represented 8% or less of all non‑financials’ bonds and 4% or less of all financials’ (Figure 2.10).
The share of sustainable bonds over all bonds issued globally varies widely from region to region
Source: OECD Corporate Sustainability dataset, LSEG.
In 2023 and 2024, unlisted companies were responsible for more than half of all sustainable bond issuances across the corporate sector, mirroring the distribution observed in all bond issuances. Among non-financial issuers, unlisted companies issued 58% of the total volume of sustainable bonds, large listed companies 27%, and smaller listed firms 15% (see Figure 2.11, Panel A). The pattern is similar in the financial sector, where unlisted companies issued 55% of the sustainable bonds, while large listed firms contributed 35% (Figure 2.11, Panel B). Interestingly, the shares of sustainable bonds issued are similar to those issued for all corporate bonds.
Unlisted companies have issued more than half of all corporate sustainable bonds in the last two years
Note: The inclusion of a company in the MSCI World Index or in the MSCI Emerging Markets Index is considered as a proxy for a listed company being large. Unlisted companies were classified as either a subsidiary with a listed parent company or “other unlisted companies”.
Source: OECD Corporate Sustainability dataset, OECD Capital Market Series dataset, LSEG, MSCI.
Globally, financial companies were responsible for nearly half of the total issuance of corporate sustainable bonds in 2020‑2024. However, there is substantial variation across regions (Figure 2.12, Panel A). Financial companies were more active issuers in Middle East and Africa (68%), Europe (53%) and Developed Asia-Pacific excl. US (49%), whereas in other regions, other industries play a more prominent role. In Latin America and the United States, utilities represented 47% and 37% of the other issuers, respectively. Basic materials issuers play a significant role in Latin America (18%), while technology issuers do in the United States (15%) (Figure 2.12, Panel B).
The financials, utilities and industrial sectors dominate the sustainable bond markets globally
Note: Panel B shows the industry distribution of the issuers of sustainable bonds, whose shares are allocated by excluding financial companies.
Source: OECD Corporate Sustainability dataset, LSEG.
Sustainable bonds represented 31% and 28% of the total amount issued via corporate bonds by companies in the financial and utilities industries in 2024, respectively. These ratios are approximately five times larger than the average share (6%) for all other non-financial issuances in the same year (Table 2.3). Renewable energy issuers may explain, at least partially, the importance of the utilities industry in the sustainable bonds market.
Financials and utilities issuers have played a leading role in sustainable bond markets in the last five years
Note: “Real estate” industry was included under “Financials” industry for all years.
Source: OECD Corporate Sustainability dataset, LSEG.
2.2.2. Official sector
Agencies and local governments, central governments and multilateral institutions have increasingly issued sustainable bonds, particularly since 2020. Nevertheless, while such issuances have become significant for multilateral institutions, they remain relatively limited for central governments (Figure 2.13). Central governments have been the least frequent issuers of sustainable bonds compared to all bonds, reaching only 0.4% of the amount issued in 2024. Agencies and local governments have been more regular users of sustainable bonds, averaging 9% of all bonds issue since 2020.
Recently, multilateral institutions have stood out as the issuer group that relies most heavily on sustainable bonds for capital market funding when compared to both other official sector entities and the private sector. Prior to 2018, sustainable bonds accounted for a maximum of 8% of the total amount issued through bonds by multilateral institutions. By 2020, they represented 55%. Since then, at least 35% of their bond issuance has corresponded to sustainable bonds (Figure 2.13, Panel C). Among all multilateral institutions the International Bank for Reconstruction and Development has issued 37% of the sustainable bonds, followed by the European Union (21%) and the European Investment Bank (12%). The International Development Association, the Inter-American Development Bank and the Asian Development Bank accounted for around 4.5% each of the amount issued by multilateral institutions.
Central governments have relied primarily on green bonds to raise capital, compared to other issuer types
Source: OECD Corporate Sustainability dataset, LSEG.
Sustainable bonds are a recent innovation in debt markets. It is natural, therefore, that very few jurisdictions have a regulatory or self-regulatory framework for sustainable bonds (as opposed to China and Japan which do). Nevertheless, since its inception, the sustainable bond markets have seen the development of standards and taxonomies. While standards are a set of rules or guidelines that promote uniformity with a benchmark, taxonomies qualify as a classification system that categorises sustainable activities. Issuers commonly use both to classify their bond as sustainable.
Alongside the two widely used international standards developed by private‑sector-led institutions, the International Capital Market Association (ICMA) and the Climate Bonds Initiative (CBI), other standards have been increasingly adopted in the market.
The ICMA published the first edition of its “Green Bond Principles” in 2014, and, in more recent years, its “Social Bond Principles”, “Sustainability Bond Guidelines” (hereinafter, “ICMA Use-of-proceeds Principles” referring to the three of them) and “Sustainability-Linked Bond Principles” (all together, “ICMA Principles”) (ICMA, 2025[5]).
The ICMA Use‑of-proceeds Principles have four core components, recommending transparency and disclosure on (i) the use of proceeds, to be described in the bond legal documentation, (ii) the process for evaluation and selection of the eligible projects, (iii) the management and tracking of the net proceeds, and (iv) the annual reporting of the proceeds’ allocation. ICMA Use‑of-proceeds Principles allow issuers to use proceeds for refinancing eligible projects but, if this is the case, it is recommended that issuers provide an estimate of the share of financing versus refinancing. Regarding the verification, the ICMA Principles recommend issuers to appoint an external review provider to assess whether the sustainable bond aligns with the relevant core components before issuance (known as a “second party opinion”). Additionally, they recommend verifying the allocation of the funds after the issuance. However, issuers may still claim compliance with the ICMA Principles even without undergoing these assessments.
The five core components the ICMA Sustainability Linked‑ Bond Principles cover (i) the selection of the Key Performance Indicators (KPIs) which should be relevant, measurable and material to the issuer’s sustainability strategy, (ii) the calibration of Sustainability Performance Targets (SPTs) to be ambitious and realistic, (iii) bond’s characteristics that will vary based of the KPIs’ performance, (iv) the annual reporting, and (v) the annual verification of the KPIs.
The Climate Bonds Initiative (CBI) published the first edition of its Climate Bonds Standard (CBS) in 2012, now covering both green and sustainability-linked bonds with climate‑related KPIs (CBI, 2024[6]). The CBS provides a framework for certifying bonds that fund climate‑related projects, establishing eligibility requirements for different sectors. It builds upon the ICMA Principles and notably recommends how pre‑ and post-issuance assurance of the sustainable bond can take place. The CBI envisages using an external assurance service provider to verify compliance with the CBS but then certifies itself the bond as compliant after receiving such an assurance statement.
While, ICMA’s Executive Committee is composed of 24 organisations, with equal distribution between investors, issuers, and underwriters (ICMA, 2024[7]), the CBI’s Board is composed of associations representing institutional investors and environmental non-government organisations (CBI, 2025[8]).
Starting from 2021, a larger number of local principles have been used (Figure 2.14). The ASEAN Green, Social and Sustainability Standards, the Japan Green Bond Guide and the China Green Bond Principle align with ICMA Principles and emphasise transparency, proper fund allocation, and timely reporting.
Importantly, the ICMA Principles – and other standards that closely follow their framework – provide only a suggested and non-exhaustive list of broadly defined eligible green and social project categories. Issuers may typically refer to third-party taxonomies for sustainable activities or to their own classification of which projects would be eligible.
The taxonomies classify economic activities in a similar way that nomenclatures for national economic statistics and international trade do (e.g. the International Standard Industrial Classification), but they also aim at defining whether these activities are sustainable (and, in some cases, setting different levels of sustainability). For activities that may not be considered inherently sustainable, the taxonomy would normally set a level of environmental or social performance above which the activity would be reckoned as sustainable (e.g. the construction of a building certified as green according to a specific benchmark).
There are many national and international taxonomies for sustainable activities as a result of both government and market-led initiatives, including, for instance, the “Green Bond Endorsed Project Catalogue – 2021” (“China Green Taxonomy” in the Figure 2.14) set by China’s central bank and securities regulator (The People's Bank of China, 2021[9]), and the “Climate Bonds Taxonomy” developed by the CBI (CBI, 2021[10]). The taxonomies typically apply both to the corporate and official sectors, regardless of the differences in their activities.
In December 2023, the European Union enacted the EU Green Bond Standard (EU GBS) regulation. The EU GBS is a voluntary framework setting out criteria for the use of proceeds, which must be allocated to projects aligned with the EU Taxonomy for sustainable activities. The standard requires issuers to disclose the relevant information in the legal documentation and undergo external verification to ensure compliance. The regulation entered into force in December 2024 and allows issuers to officially label their bonds as “EU green bonds”. This explains why, at the end of 2024, no bond used the EU GBS.
The ICMA Principles are the most used standard, but local standards have emerged recently
Note: The values correspond to the total amount issued following different standards and taxonomies. The values indicate the standards or taxonomies a sustainable bond conforms to or is aligned with (as reported by the issuers). A single sustainable bond can exhibit compliance/alignment with one or more standards or taxonomies.
Source: OECD Corporate Sustainability dataset, LSEG.