Green finance in Asia: challenges, policies and avenues for research

ABSTRACT

Financing climate change mitigation and adaptation in Asia is critical for its population and economies but also for those of the world. This editorial provides a commentary and overview of ten articles within this special issue of Climate Policy on ‘Green Finance in Asia’. Contributions are diverse in terms of focus and methods. Most of the articles focus on managing transition risk with six of the articles having an energy focus; the dominant themes are the risk of stranded coal assets in China; the role of export finance by China and Japan for fossil fuel-fired power generation assets within Asia; and investment in renewable power generation and the policies to support such investment. The remaining four articles explore various policies in specific country contexts: the effects of green bond policies in China; the greening of monetary policy in China; the governance of sustainable finance in Indonesia; and policies to support investment and finance of off-grid electricity access in Bangladesh. Most of the ten contributions come from researchers in developed countries and principally from non-Asian countries, suggesting there is a need to develop green finance research capability and capacity across Asia. Despite being withing scope of the special issue, this collection does not contain papers on physical risk or adaptation finance. We highlight these as important gaps and priorities for future research.

Key policy insights

• This editorial provides a commentary and overview of ten articles within this special issue of Climate Policy on ‘Green Finance in Asia’.

• Most of the ten contributions come from researchers in developed countries and principally from non-Asian countries.

• There is a need to develop green finance research capability and capacity across Asia.

• Most contributions were focussed on transition risk, with limited or no focus on physical risk and adaptation finance. This likely reflects the multiple resource and expertise challenges faced when conducting physical risks assessments.

KEYWORDS:

• Asia
• green finance
• climate finance
• energy finance

1. Introduction

Stimulating green investment and the financial implications of environmental risks have become critical issues for investors, corporations, NGOs, financial regulators and policymakers. With respect to climate change, the IPCC notes that limiting global warming to 1.5°C requires annual average investment in the coming decade in the energy sector alone (not accounting for transport) of around US$ 2.4 trillion (IPCC, 2018, 2022a, WG3-Ch15). There is, however, a large funding gap with current estimates of funds flowing to climate adaptation and mitigation (referred to here as ‘global climate finance’) estimated at US$ 632 billion in 2019/2020 (Buchner et al., 2021); most of this financing is directed at mitigation/transition finance (US$ 571 billion) as comparted to adaptation/physical risk finance (US$ 46 billion). Underscoring its importance globally, developing Asia was the main destination of global climate finance in 2019/2020 accounting for US$ 322 billion (Buchner et al., 2021). Of this, the majority of global climate finance is destined for mitigation and specifically, for clean energy systems such as solar and wind power generation.

Despite the increasing and relatively large numbers, there is clearly a need to scale-up climate financing globally, given the need to invest in renewable energy technologies, energy transition, energy efficiency and for the development of related financial products such as green or sustainability-linked bonds. On the flip side, physical climate change presents material risks and challenges to investors, financial institutions and the financial system more generally, and these risks must be recognized and addressed, raising the need for adaptation finance.

The Asia region is highly vulnerable to the consequences of climate change and related natural disasters. IPCC AR6 WGII (IPCC, 2022b, p. 59) identifies associated impacts of climate change in Asia to include damage to assets, and impacts on people and their health due, for example, to flooding in mega-cities and other settlements located in coastal areas. Also in coastal areas, a decline in fishery resources is occurring due to climate-related sea level rise, ocean warming and acidification, and coral bleaching. Other impacts include biodiversity loss and habitat shifts with associated disruptions in freshwater, land, and ocean ecosystems. Extreme temperatures and rainfall variability, and a related increase droughts is raising food and water security risks.

Climate-related financial risks are thus profound and systemic. Increasingly, these financial risks are understood by businesses and financiers alike though the work of the Network of Central Banks and Supervisors for Greening the Financial System (NGFS), the Financial Stability Board (FSB) and its Task Force on Climate-Related Financial Disclosure (e.g. TCFD, 2017, 2021). The 2017 TCFD recommendations on disclosure laid out two main channels of climate-related risk for consideration, notably physical risks and transition risks, as well as the need to understand and report on opportunities deriving from climate change. Opportunities can range from understanding how companies are investing in renewable energy and energy efficiency to how they are building resilience in their operations such as by climate-proofing supply chains. TCFD (2017) recommends changes in governance, in strategy, in risk management and the use of metrics and targets to guide businesses and financial institutions response to the risk and opportunities posed by climate change.

Climate-related financial risks, opportunities and financing needs are particularly apparent in Asia. In meeting the demand of growing populations and economic growth over the past three decades, many countries in the region have expanded their use of fossil fuels, resulting in an energy mix dominated by coal power with rising emissions (see Diaz-Rainey, Tulloch et al., 2021). Though most Asian countries tend to have relatively low per capita CO2 emissions, in absolute terms the region accounted for around 58% of global CO2 emission in 2020 (around 20.3 billion tonnes from a global total of 34.8 billion tonnes) and is host to China, the largest CO2 polluter globally (10.7 billion tonnes), and several other large CO2 polluting economies (including India, Japan, Indonesia and South Korea).¹ As noted, these countries are also amongst the largest markets in the world for renewables and other clean energy.

It is in this context that two events were organized to collate research on green finance in Asia. The first was an online Workshop on Climate Finance in Asia and Australasia tied to the 3rd Global Research Alliance for Sustainable Finance and Investment (GRASFI) Conference hosted by Columbia University, New York, on 9–10 September 2020. The second was a special stream of the 1st Climate and Energy Finance Group (CEFGroup) Climate Finance Symposium organized by the University of Otago, Dunedin, on 3–4 December 2020. This effort had two broad outcomes in mind, namely, to foster research, researcher capacity and capability development on green Asian finance; and to publish this related Special Issue of the Climate Policy journal.

The open call for papers in advance of the two events was framed around climate change and broader green issues. Following the events and a review process, ten papers were ultimately selected for inclusion in this Special Issue. Collectively, this volume represents one of the most comprehensive examinations of green finance in Asia published to date. The articles in this volume focus on climate-related transition risks in Asia and the ways that governments and other market actors are addressing these.

This editorial provides an overview and thematic commentary of the papers within this special issue. It is organized as follows: Section 2 provides more context to green finance in Asia; Section 3 provides an overview of the papers and a discussion of common themes; and Section 4 concludes by drawing out overarching policy insights and suggestions for future research.

2. Asian green finance

What happens in Asia is key to the global transition towards low-carbon development and net zero greenhouse gas (GHG) emission pathways and whether ambitious Paris climate goals can be met. Both the pace and the extent of decarbonization of the power sector is one of the biggest policy challenges, with progress needed in all G20 countries, including those in Asia, notably the large economies of China, India, Indonesia, Japan and South Korea. The energy transition challenge is particularly acute in Asia given rapid economic growth and associated growth in energy demand, high reliance on coal power generation (it is the region most reliant on coal) and ongoing energy security and energy access concerns in developing Asia, with hundreds of millions without access to power (Diaz-Rainey, Tulloch et al., 2021 ; EIU, 2022). The region is, however, the largest market for renewables globally (EIU, 2022).

As in other regions, green finance has become a major topic in Asian financial markets over the last couple of years. Awareness is growing that climate change and related environmental degradation pose serious dangers to economic activity and threaten macro-financial stability across the region. As noted above, this is in part because many Asian countries are amongst the most vulnerable to climate change, causing substantial physical risks for the financial sector as well as public finances (Beirne et al., 2021; Volz et al., 2020). Most Asian economies are also exposed to significant transition risk resulting from changes needed in global energy and transport systems. It is therefore imperative to incorporate climate-related financial risks into financial decision making.

A growing number of Asian countries have adopted targets for achieving net-zero greenhouse gas emissions by mid-century or later. As highlighted by Ravi Menon, the Managing Director of the Monetary Authority of Singapore and Chair of the NGFS, ‘[t]he transition to net zero will likely entail the biggest economic and societal transformation since the Industrial Revolution’ (Menon, 2022). Vast financial resources need to be mobilized across Asia for investment in climate-resilient, sustainable infrastructure – including energy, transportation, waste management, and health – to deliver achieve the Sustainable Development Goals (SDGs) and the goals of the Paris Climate Accord. The Asian Development Bank estimates that developing Asian economies need US$ 1.7 trillion a year in climate-adjusted infrastructure investment in transportation, power, water and sanitation and telecommunications (ADB, 2017); clearly the key today is to shift this infrastructure spend toward low-carbon, environmentally sustainable systems. The United Nations Economic and Social Commission for Asia and the Pacific estimates the need for an additional annual investment of US$ 1.5 trillion to attain the Sustainable Development Goals (SDGs) by 2030 (UN ESCAP, 2019). These large estimates for infrastructure investment reflect huge and ongoing gaps in basic infrastructure investments globally and more specifically in this region.

To align finance with climate and other sustainability goals, and make sure that risks and impacts are adequately accounted for, governments and financial authorities need to set the right framework conditions. Interestingly, central banks and supervisors in developing Asia were among the first to introduce green finance policies or incorporate environmental risk into prudential frameworks (Volz, 2019). Chinese monetary and financial authorities started already in 2007 to develop green credit policies and have since been among the most active in promoting sustainable finance. In 2015, the People’s Bank of China established a Green Finance Committee to develop green finance practices, environmental stress testing for the banking sector, and guidelines on greening China’s overseas investment. Bangladesh Bank, the central bank of Bangladesh, was also an early mover when it issued ‘Policy Guidelines for Green Banking’ and ‘Guidelines on Environmental Risk Management’ already in 2011, requiring environmental risk management from bank and non-bank financial institutions. Other central banks in developing Asia, including the State Bank of Viet Nam and the Reserve Bank of India developed policies to boost green lending. In the Philippines, the Bangko Sentral recently launched a Sustainable Finance Framework, setting out expectations for banks to develop transition plans and integrate these into their corporate governance and risk management framework (Ariyapruchya & Volz, 2022). Bank Negara Malaysia has developed an industry-wide climate risk stress testing exercise that it plans to run in 2024 (Ariyapruchya & Volz, 2022).

Central banks and supervisors in Asia have sought to promote sustainable finance through engagement with the financial industry through multi-stakeholder dialogues, capacity building efforts or sustainable finance roadmaps (Ariyapruchya & Volz, 2022). For instance, in 2015 Otoritas Jasa Keuangan, the Indonesian financial services regulator, established a multi-stakeholder task force to promote and further develop its Roadmap for Sustainable Finance through dialogue and develop the sustainability skills of professionals (Setyowati, 2023). Many other Asian countries have adopted an industry-led approach with financial authorities working with financial industry associations to incorporate principles of sustainable finance into business activities as reflected in Singapore’s Guidelines on Responsible Financing in 2015, Cambodia’s Sustainable Finance Principles Statement of Intent in 2016, and Thailand’s Sustainable Banking Guidelines on Responsible Lending in 2019.

Authorities in several Asian countries have already introduced green or sustainable taxonomies, including China (2015), Bangladesh (2017), Mongolia (2019), Malaysia (2020) and Indonesia (2022) (Ariyapruchya & Volz, 2022 Volz, 2021;). A green or sustainable finance taxonomy provides criteria for evaluating whether and to what extent a financial asset is in line with green or sustainability goals, which provides guidance to financial market participants seeking to invest in green/sustainable assets. Some countries have issued their own standards for green or sustainable bonds, including China in 2015 as the first country globally, India in 2016, and Indonesia and Japan in 2017 (Volz, 2021). In 2017, the ASEAN Capital Markets Forum (ACMF), which comprises capital market regulators from all 10 jurisdictions of the Association of Southeast Asian Nations (ASEAN), issued the ASEAN Green Bonds Standards in an effort to nurture this market and facilitate investment into green investments (Volz, 2021). In 2018, the ACMF published the ASEAN Social Bond Standards and the ASEAN Sustainability Bond Standards. Some monetary and financial authorities have also developed initiatives specifically aimed at promoting development of green bond markets (Volz, 2021). For instance, the Monetary Authority of Singapore established in 2017 a Green Bond Grant Scheme for issuances that comply with internationally recognized green bond standards.² In 2018, the Hong Kong Quality Assurance Agency launched a similar Green Finance Certification Scheme.³ Beyond green bond markets, some efforts amongst financial industry associations in Asia are aiming to replicate and scale standardization of green products in loan markets through Green Loan Principles. However, these principles have not been as widely used as the above-mentioned standards for the sustainable debt (green bond) market.

Internationally there is mounting evidence that financial markets are starting to price climate risks, though the extent of the pricing and what elements of climate risk are being prices is less clear (see for instance Diaz-Rainey, Gehricke et al., 2021; Griffin et al., 2017; Hong et al., 2019; Nguyen et al., 2022). In general, this emerging body of evidence suggests financial markets are better able to price transition risk than physical risks. Perhaps this is not surprising given that analysing climate physicals risks at corporate level is challenging – it comes with onerous data and the capability requirement (large interdisciplinary teams are needed) for firms that are dispersed nationally and internationally. It is in response to this that a climate intelligence arms race has been initiated (Keenan, 2019).

But major challenges remain in mainstreaming green finance in Asia. Despite rapid growth, for the time being sustainable or green lending and investment account only for a small fraction of the total. Asian financial markets continue to finance investments that undermine the achievement of the Paris climate goals and the SDGs. Financial markets – in Asia as elsewhere – still predominantly focus on short-term returns and ignore long-terms risks to nature and society. The timeframe to prevent catastrophic global warming and halt biodiversity loss is short. All relevant actors – including governments, central banks and supervisors, commercial banks and non-bank financial institutions – therefore need to scale up their efforts to make sure that the financial sector becomes part of the solution in addressing climate and environmental change rather than remaining as part of the problem.

3. Overview and thematic discussion of papers in this special issue

Appendix 1 provides an overview of the ten contributions in table format. It provides information of domicile of the researchers, the geographical focus of the research, methods used, the thematic focus, as well as whether the research was focussed on transition or physical risk.

Methodologically, the ten contributions were diverse; a mix of quantitative and qualitative analyses that included traditional econometric analyses, scenario-based projections, and qualitative content analyses and interviews. Such richness of research methods is needed if global climate finance research is to be truly relevant for policy and practice (Diaz-Rainey et al., 2017).

Interestingly, most of the ten contributions came from researchers in developed countries and principally from non-Asian countries, suggesting there is a need to develop green finance research capability and capacity within Asia. Most researchers focussed on the Chinese context. With China accounting for over a quarter of global CO2 emissions and more than half of Asia’s CO2 emissions (see Section 1), it is not surprising that six of the ten contributions focussed on China. Other papers addressed green and sustainable finance issues in Japan, Bangladesh and Indonesia. Obvious omissions include two other big Asian polluters, India and South Korea. India is, in particular, an important context for climate finance research given its rapidly rising emissions, its high vulnerability to physical risks and given that it is host to a range of innovative green finance initiatives and policies aiming to drive renewable energy investment.

In terms of research focus, all ten contributions were focussed either fully all partly on transition risk (see Appendix 1) or climate mitigation with only two having some, if limited, focus on physical risk. This likely reflects the challenges in conducting physical risks assessments but it also probably reflects an ‘outsider’ perspective of climate risk in Asia from our principally non-Asian based authors. This is a concern given the vulnerability of Asia to physical risks (see IPCC, 2022b, p. 59, and the earlier discussion in Section 1). There is evidently a need to develop global climate finance capability and capacity in Asia around physical risks and impacts specifically.

The contributions are organized thematically into three high level themes in Appendix 1, namely; fossil fuels; renewables; and other green finance topics. Within those high-level themes, six sub-themes are apparent: (1) stranded coal assets in China (Clark et al., 2023; Zhang et al., 2023), (2) export finance for fossil fuel generating assets (Hughes & Downie, 2023; Larsen & Oehler, 2023), (3) financing renewables (Azhgaliyeva et al., 2023; Hellqvist & Heubaum, 2023), (4) green bond policies in China (Saravade et al., 2023), (5) the governance of sustainable finance in Indonesia (Setyowati, 2023), and (6) greening of monetary policy in China (Dikau & Volz, 2023; Macaire & Naef, 2023).

3.1. Theme 1: fossil fuels

Two papers, Zhang et al. (2023) and Clark et al. (2023), explore the risk of stranded coal assets in China. Zhang et al. (2023) quantify China’s stranded coal assets under different coal capacity expansion scenarios with drawing on both top-down and bottom-up approaches. They find that if coal capacity peaks during 2020–2030, a sizeable yet manageable stranded asset loss of US$ 55 billion is incurred between 2020 and 2045. However, a continued expansion of coal-fired capacity (200∼400 GW, would significantly enlarge the loss by up to 7.2 times (close to US$ 400 billion). The clear policy implication of this research is that halting the construction of new coal-fired plants is a low-cost and no-regret option for China. Clark et al. (2023) also address the prospect of China continuing to build new coal-fired power plants. Their approach is to contrast a broad costs and benefits ‘economic’ framework relative to the plant-level financial analysis that is usually commonly used to assess stranded asset risks. This novel approach highlights that the broader economic interest can, and does diverge, from the private interest of corporations. They explore these differences in the context of policy interventions (a shadow carbon price and caps on coal-fired electricity generation) and relative to an alternative solar/storage investment. They find that the renewable option yields higher economic returns than the coal plant under modest shadow carbon pricing and lower electricity storage costs. Using different approaches Zhang et al. (2023) and Clark et al. (2023) strongly suggest that it is not in China’s economic interest to build more coal capacity.

The next two papers explore the role of bilateral export finance from Japan (Hughes & Downie, 2023) and China (Larsen & Oehler, 2023) for fossil fuel generating assets within Asia. Hughes and Downie (2023) focus on Japanese bilateral financing of thermal coal power generation in the Asia-Pacific by reviewing publicly available documents from relevant organizations and via interviews of stakeholders. They find that Japanese bilateral finance organizations and policy bodies take climate risk into account when making lending decisions on thermal coal assets but they have not, until recently, explicitly addressed stranded asset risk. This suggest that assets holders and governments are exposed to stranded assets risk. Further, Larsen and Oehler (2023), using mixed methods, note that though China is the world’s largest investor in renewable energy, however, its overseas energy investments are primarily in fossil fuels. They find that Chinese renewable firms face significant structural financing disadvantages relative to fossil fuel energy firms. The reason is that Chinese fossil fuel companies are largely state-owned while renewables companies are largely privately-owned. This structural different affects export financing given the Chinese financial system’s preference for state-owned enterprises. The authors suggest ways to overcome these issues through policies targeting state-owned commercial and policy banks, smaller financial institutions, Sinosure (China Export & Credit Insurance Corporation), and Chinese energy utility, and construction companies. Both Hughes and Downie (2023) and Larsen and Oehler (2023) highlight the critical role intra-Asian energy export finance will play in either meeting or failing to meet clean energy transition goals in the region and the critical role government and policy can play in ‘cleaning-up’ export finance.

3.2. Theme 2: renewables

The second theme of the special issue deals with renewables energy finance (Azhgaliyeva et al., 2023; Hellqvist & Heubaum, 2023). Azhgaliyeva et al. (2023) empirically examine the drivers of private investment in renewable energy across different types of financing, namely asset finance, corporate research and development (R&D), public market, and venture capital and private equity, for 13 economies over the period 2008–2018, with a focus on a sub-panel of Asian economies. Amongst their numerous findings they find that government R&D and feed-in tariffs positively affect green finance. Clearly policy action in various forms can stimulate green finance, however, the interaction with technology costs and energy prices are also important determinants, especially in the Asian context.

Hellqvist and Heubaum (2023) use a qualitative case study to explore Bangladesh’s much heralded Solar Home System (SHS) programme, the world’s largest domestic solar off-grid household electrification scheme. The scheme has been close to collapse in recent years and Hellqvist and Heubaum (2023) explore the reasons behind this development. They find that the government’s simultaneous implementation of several competing on- and off-grid energy access projects and lack of regulatory oversight alongside significant subsidy decreases made SHS uncompetitive. This fascinating case study underlies the need for co-ordinated and complementary policy developments. It is an example of simultaneously too little regulation, and too many overlapping policies.

3.3. Theme 3: other green finance topics

The last theme deals with broader green finance topics, including green bond policies (Saravade et al., 2023), the governance of sustainable finance (Setyowati, 2023) and greening of monetary (Dikau & Volz, 2023; Macaire & Naef, 2023).

Saravade et al. (2023) employ an econometric approach to Chinese green bond issuances from 2012 to 2019 and find a direct positive influence of green bond regulatory policies on issuance amounts. Their results show the important role financial regulators can play in advancing the green bond market development. Drawing on stakeholder interviews Setyowati (2023) examine the development of Indonesia’s sustainable finance roadmaps between 2019 and 2020. They find high procedural compliance by financial institutions with respect to the road maps but there is variation and inconsistency in interpreting what constitutes a ‘green’ – hinting at greenwashing in some cases. They suggest greater regulatory involvement is needed to ensure enhanced disclosure standards and more effective risk management.

Dikau and Volz (2023) explore ‘window guidance’, a relatively informal policy instrument used by central banks to guide lending, in the context of ‘greening’ monetary policy. Specifically, they explore window guidance for the period 2001–2020 used by the Peoples’ Bank of China (PBC) and the China Banking Regulatory Commission (CBRC) to encourage green lending and discourage ‘dirty’ lending. Although both PBC and CBRC started to retreat from this policy from 2006 and ultimately stopped in 2014, Dikau and Volz (2023) conclude that green window guidance can help direct bank lending to support environmental goals especially in less developed financial markets. As such, the Chinese experience holds valuable lessons for other emerging and developing country economies that have financial systems dominated by banks. A different green monetary policy innovation in China is explored econometrically by Macaire and Naef (2023). Specifically, they explore the impact of the PBC’s decision in June 2018 to include green financial bonds into the pool of assets eligible as collateral for its one of its core monetary policy tools (the Medium-Term Lending Facility). Their findings show that a central bank can actively influence market rates for green projects compared with non-green projects though such policies. Similar to Dikau and Volz (2023), they observe that such policies are likely to be effective especially in nascent green bond markets, as was the case in China before the policy change.

4. Conclusions and avenues for further research

The ten diverse contributions in this special issue highlight a range of challenges and opportunities for green finance in Asia across multiple dimensions and contexts. Each article has its own key policy insights, but it is worth reflecting in commonalities in this respect. Every single contribution focussed on the role of government or policies or regulations in some way. It was striking how many policy levers exist around green finance – these include: feed-in-tariffs and subsidies for renewables, shadow carbon prices, moratoriums on new coal generation, green bond standards, export finance policies and guidelines, sustainable finance road maps and related reporting requirements, and green monetary policy tools overseen by central banks (such as widow guidance and collateral policies). Governments and policymakers face a lot of choices in this respect and this collection of articles provides insights into some of these policy tools and lessons learnt from how they have been applied in Asia.

It is noteworthy that in all contributions, the research found that policies will play a critical role in green finance. This includes playing a critical role in stimulating the redeployment of private capital away from fossil fuels and towards ‘clean’ alternatives. It also includes policies to ensure that green finance is deployed in a meaningful way – by, for instance, avoiding greenwashing as in the case of Setyowati (2023). The interplay between the state and markets via policy is therefore critical to shift capital towards green finance.

The overarching conclusion from this collection is that policy interventions have been largely successful (some more than others, see for instance Azhgaliyeva et al., 2023) and that these may be more effective when markets are nascent or underdeveloped (see Dikau & Volz, 2023; Macaire & Naef, 2023). Indeed, the articles on stranded assets highlight considerable risks from the government not intervening in a timely way (Clark et al., 2023; Zhang et al., 2023). However, not all always goes well when intervening, as the case study on SHS in Bangladesh highlights; when governments employ multiple policy tools, these need to be complementary and co-ordinated (Hellqvist & Heubaum, 2023).

This collection of articles represents one of the most comprehensive examinations of green finance in Asia published to date, however, much work remains be done. As noted in Section 2, all ten contributions were focussed either fully or partly on transition risk (see Appendix 1) or climate mitigation. There is clearly a need for more research on physical risk and adaptation finance given the vulnerability of Asia to physical risks (see IPCC, 2022b, p. 59 and Section 1). Further, six of the ten contributions focussed on China. Other papers focussed on Japan, Bangladesh and Indonesia. Obvious omissions include two other big Asian polluters and major actors in green finance, India and South Korea. India is, in particular, an important context for climate finance research given its rapidly rising emissions, its high vulnerability to physical risks and its potentially pivotal role in taking renewable energy to scale. Finally, most of the ten contributions came from researchers based in developed countries and principally from non-Asian countries, suggesting there is a need to develop green finance research capability and capacity across and within Asia more generally, but specifically round physical risk.

Acknowledgments

Diaz-Rainey (Lead Guest Editor) would like to thank Frank Jotzo for supporting this special issue and the broader Climate Policy journal editorial team for their professionalism. Iftekhar Ahmed, Renzhu Zhang and the University of Otago conference support and video conferencing units provided excellent assistance in organizing the two associated events. One of those events was a workshop tied to the 3rd GRASFI conference that was hosted by Columbia University. Thanks to Lise Johnson and the Columbia University team for supporting and promoting the workshop. Finally, we thank all the peer reviewers and paper discussants at the associated events. The usual disclaimer applies.

Notes

1 Source Ritchie & Roser (2022) “CO2 emissions” https://ourworldindata.org/co2-emissions [21/09/2022].

2 Climate Bonds Initiative (2017) Hot off the press: Singapore’s central bank announces Green Bond Grant scheme to cover any additional issuance costs of going green – what a way to kick-start the market!.

3 GoHK (2018) Government welcomes HKQAA's Green Finance Certification Scheme (info.gov.hk).

Appendix 1:

Overview of contribution

Table

Author(s)	Author(s) country	Title	TCFD taxonomy	Theme	Sub-Theme	Country focus	Method(s)
Zhang et al.	CN	Quantifying stranded assets of the coal-fired power in China under the Paris Agreement target	Transition	Fossil fuels	Stranded coal assets in China	China	Top-down and bottom-up modelling of scenario based projected coal deployment
Clark et al.	UK,US	Government shareholders, wasted resources and climate ambitions: Why is China still building new coal-fired power plants?	Transition			China	Combined financial and economic analyses
Hughes, Downie	AU	Bilateral finance organizations and stranded asset risk in coal: the case of Japan	Transition		Export finance	Japan	Qualitative content analysis
Lund Larsen, Oehler	CN,DK,DE	Clean at home, polluting abroad: the role of the Chinese financial system’s differential treatment of state-owned and private enterprises	Transition			China	Qualitative content analysis, interviews and descriptive quantitative analysis
Azhgaliyeva et al.	JP,IN	What matters for private investment in renewable energy?	Transition	Renewables	Renewable energy finance	Global and Asia	Econometric Analysis
Hellqvist, Heubaum	UK	Setting the sun on off-grid solar?: Policy lessons from the Bangladesh Solar Home Systems (SHS) programme	Transition			Bangladesh	Qualitative content analysis
Saravade et al.	CA,CN	Impact of regulatory policies on green bond issuances in China: Policy lessons from a top-down approach	Transition and physical	Other green finance topics	Green bonds	China	Econometric Analysis
Setyowati	AU	Governing sustainable finance: Insights from Indonesia	Transition and physical		Governing sustainable finance	Indonesia	Qualitative content analysis and interviews
Dikau, Volz	UK,DE	Out of the window? Green monetary policy in China: Window guidance and the promotion of sustainable lending and investment	Transition		Green monetary policy in China	China	Qualitative content analysis
Macaire, Naef	FR	Greening monetary policy: Evidence from the People’s Bank of China	Transition			China	Econometric Analysis