Green bond issuance hits record $193 billion in Q2 2026, Moody's says

September 5, 2026 at 08:00 PM2 min

This digest was compiled by AI from multiple sources — links to the originals are below.

Global green bond issuance reached a record $193 billion in the second quarter of 2026, driven largely by European issuers, according to Moody's. Overall labelled sustainable bond issuance rose 4% year-over-year in the same period. Green bonds still account for only about 3% of the global bond market.

Key Facts

Global green bond issuance totalled $193 billion in Q2 2026, a record quarter, according to Moody's.
Overall labelled sustainable bond issuance rose 4% year-over-year in Q2 2026.
Green bonds account for around 3% of the global bond market.
In 2023, global green bond issuance reached $575 billion, with governments accounting for $190 billion.
The Climate Bonds Standard Board is one of the official bodies overseeing the green bond sector.

Record Issuance

In the second quarter of 2026, global green bond issuance totalled $193 billion, marking a record quarter and driven largely by European issuers, according to a report from Moody's. Moody's report showed that global issuance of labelled sustainable bonds – such as green, blue, social, sustainability, sustainability-linked, and transition bonds – rose by 4 per cent year-over-year in the second quarter of 2026. In 2012, a total of $2.6 billion in green bonds was issued worldwide, a figure that has risen dramatically in recent years to $575 billion in 2023, with governments accounting for $190 billion of the total. The issuance of blue bonds, which raise capital specifically for marine- and water-related projects with long-term environmental benefits, has also increased in recent years.

Market Challenges

Green bonds account for just around 3 per cent of the global bond market. The recent low uptake in this sector has been largely attributed to regulatory complexities, high issuance costs, greenwashing, and inconsistencies in definitions of “green” and “sustainable”, according to a report from the Institute for Energy Economics and Financial Analysis (IEEFA). Labanya Prakash Jena, a consultant for sustainable finance at IEEFA, explained, “Green bond labelling is central to the credibility, transparency and effectiveness of green bonds. However, green bonds face significant challenges that can undermine their efficacy – most notably, greenwashing.”

Growth Drivers

Green bonds contribute to projects that support the environment, such as renewable energy, clean transportation, and pollution reduction. They have become a means for governments and companies to attract investors who care about sustainability and addressing climate change. The market has also grown as companies have incorporated stricter environmental, social, and governance (ESG) practices into their operations. Green bonds often provide tax incentives, such as credits and exceptions, making them more attractive to investors. The demand for green bonds is expected to continue increasing as more companies incorporate ESG practices and several governments strive for a green transition.