CCP CCP Climate Finance & Green Bonds 2

Question 1

What is 'greenwashing' in the context of climate finance and green bonds?

Accepted Answer

Misleading claims that a financial product or investment funds genuine environmental benefits when it does not

Answer

Greenwashing refers to deceptive or unsubstantiated marketing that overstates the environmental credentials of a financial product, fund, or investment, undermining investor trust and market integrity.

Question 2

What is the Task Force on Climate-related Financial Disclosures (TCFD) framework primarily designed to do?

Accepted Answer

Help companies disclose climate-related financial risks and opportunities to investors and stakeholders

Answer

TCFD provides a voluntary framework for organizations to disclose climate-related financial risks and opportunities across four pillars: governance, strategy, risk management, and metrics and targets.

Question 3

Under the EU Sustainable Finance Disclosure Regulation (SFDR), what are 'Article 9' funds?

Accepted Answer

Funds that have sustainable investment as their core objective, with the highest level of green claims

Answer

Article 9 (dark green) funds under SFDR must have sustainable investment or a reduction in carbon emissions as their explicit investment objective and face the strictest disclosure requirements.

Question 4

What is a 'transition bond' and how does it differ from a standard green bond?

Accepted Answer

A transition bond finances activities in high-emitting sectors moving toward lower emissions, while green bonds fund already-green activities

Answer

Transition bonds finance climate transition activities in hard-to-abate sectors like steel, cement, and shipping that are not yet 'green' but are taking credible steps toward lower-carbon operations.

Question 5

What does the Climate Bonds Standard (CBS) certification by the Climate Bonds Initiative certify?

Accepted Answer

That a bond's proceeds are allocated to assets and projects consistent with a 1.5°C or well-below 2°C climate pathway

Answer

The Climate Bonds Standard provides science-based sector criteria to ensure bond-financed assets are consistent with a low-carbon economy aligned with the Paris Agreement temperature goals.

(CCP) Certified Climate Change Professional Practice Test

(CCP) Certified Climate Change Professional Practice Test

CCP CCP Climate Finance & Green Bonds 2