Zeng Gang: "Carbon peak" is not a "carbon charge", how to write the "big article" of green finance in the future?

Zeng Gang is the director of the Shanghai Finance and Development Laboratory

Sustainable development finance mainly refers to how finance can better serve the sustainable development of economy and society. In China, the concept of green development has become one of the important development concepts of national development, and it is also the modernization of the harmonious development of man and nature, which is particularly mentioned in Chinese modernization.

In recent years, with the proposal of the "dual carbon goals" in mainland China, the importance of supporting "carbon emission reduction" in the development of green finance has been increasing, and the related transition finance has also become an important direction of green finance innovation.

As of the end of June 2023, the balance of green credit in local and foreign currencies in the banking industry is about 27 trillion yuan, and the balance of green bonds is about 3 trillion yuan, ranking first in the world, and about 100 billion yuan of green bonds are directly linked to "carbon emission reduction" and "carbon neutrality", and the development speed is relatively fast. In addition, public and private equity and insurance products related to green themes have also developed rapidly in the past.

On the whole, the current green finance policy system is relatively complete, the institutional system is relatively rich, all kinds of financial institutions are involved, and the market system is becoming more and more diversified, which has laid a very good foundation for doing a good job in the "green finance" article.

In the context of emission reduction, transition finance has become the focus of green finance development, green finance in a broad sense refers to financial support for green development, in a strict sense, it is a part related to transition finance and "double carbon", the difference between green finance and transition finance is mainly that green finance in the narrow sense focuses on green industries and projects, and in practice, green bonds and green credit need to be operated in accordance with the relevant catalog. The green industries and projects included in these catalogues do not account for a high proportion of the total economy. However, for the country, the green development strategy is not limited to the development of green industries, and the transformation of the entire economy and society (especially "carbon reduction") also includes the low-carbon development and transformation of high-emission industries, and it is more important to promote the low-carbon transformation of high-emission industries to achieve emission reduction goals.

From the perspective of national development, it is necessary to balance the relationship between low-carbon transition and economic development, and "carbon peaking" is not a "carbon charge", and it is necessary to gradually reduce carbon intensity while achieving stable economic growth, which means that support for high-emitting industries to achieve low-carbon transformation in an orderly manner is needed. Supporting the low-carbon transition of high-emitting industries does not belong to green finance in the narrow sense, but should fall under the scope of transition finance. From the perspective of development logic, transition finance is an extension of the development of green finance in the narrow sense in the early stage, and is the main direction of the development of green finance in the new era.

At present, the green financial market system is very complete, and I think the next step is to focus on the following aspects.

The first is to expand the scope of the original tools, policy tools to further expand, at the regulatory level, the existing regulatory system has been very perfect, assessment incentives have also been available, should continue to promote the implementation and implementation. In addition, the improvement of the system is very critical, at present, there are more systems to support incentives, less constraints, "carbon emission reduction" is to carry out relevant constraints, constraints can help financiers to truly achieve emission reduction goals, so it is necessary to improve the system, add binding clauses, and in the specific implementation, as part of the performance clauses, in the judiciary to be respected, which requires the improvement of a complete set of systems. Secondly, it is also necessary to improve the standard, there is a relatively unified standard after there is a comparative reference, the standard is not only internal to be unified, the external in the international comparability, the so-called two-way system opening, to a certain extent, is to be comparable with the international, to achieve "internal unity, external docking", the future at the standard level still has a long way to go.

At the same time, the disclosure of green bond information is relatively strict and transparent, and the following aspects need to be strengthened in the future. First, the standards are unified, such as the scope of disclosure, the subject of disclosure, the content of disclosure, etc., and different types of products should be comparable in the future, such as the core of credit disclosure, bond disclosure and equity disclosure. The second is the scope of disclosure, disclosure is a kind of responsibility, once disclosed, the institution will bear the corresponding responsibility, will pay more attention, especially the listed companies are facing strong constraints, which will further strengthen the constraints of the market. The third is the use of disclosure information, the advantage of information disclosure is that after disclosure, it provides more public data for the society, and intermediaries can use these data to carry out more diversified processing, generate more valuable content, provide more services for investors, form a positive cycle, and give full play to the efficiency of market constraints.

At present, there are still some problems in the development of the domestic green finance market, one of which is the lack of professional ability, especially in the field of "carbon emission reduction", "carbon emission reduction" to really examine the credit process, need to actually produce emission reduction effects, including "carbon neutrality bonds" or "carbon-linked emission reduction bonds" and other strict requirements, which poses a greater challenge to financial institutions. For example, the monetary policy tool of precise emission reduction is required to be verifiable and verifiable, but how to verify and verify the bank is a more complex problem, which has created a cross-border, financial experts need to become industry experts, and in the face of multiple industries, the logic of each industry or industry is different, and business experts from different industries are needed, which is a big problem.

The same is true in the bond market, where intermediaries have a lot of responsibility and take a long time to build their capabilities, which also means that there is a huge demand for professional intermediaries. There are many investors in the bond market, which requires a lot of research work and high-quality intermediary services. How to ensure that intermediaries are on the side of investors rather than issuers, the design of the mechanism is crucial. Under the issuer-paid model, it is difficult to avoid spending money to buy ratings, which to a certain extent causes a large difference between ratings and actual performance. The investor-paid model is theoretically good and can solve this problem, which is a good exploration, but exploration still needs a process. Intermediaries are crucial to the development of the market, and in the long run, the direction of the investor-paid model will help the market develop healthier, and help guide the intermediary behavior in the right direction.

Note: With authorization, it is compiled according to the content of the interview "Dialogue: China Debt" of China Debt Credit. Editor: Wang Jing.

Source: Xinhua Finance on January 25, 2024