The Impact of Central Bank Communication on Sustainable Finance Instruments

The Impact of Central Bank Climate Communication on Green Bonds
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Volume/Issue: Volume 2025 Issue 169
Publication date: August 2025
ISBN: 9798229021609
$20.00
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Topics covered in this book

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Banks and Banking , Environmental Economics , Public Policy- Environmental Policy , Central banking , Communication , Climate change , Green bonds , Sustainable finance , Natural language processing , climate communication , central bank communication , finance instrument , central banks' communication , bond issuance , Climate finance , Central bank mandate , Climate policy , Global

Summary

This paper analyzes how central banks' communication influences corporate financial decisions and instruments. Empirically, we find that more active central bank communication is associated with a rise in firms' green bond issuance. The effect seems to be particularly strong among commercial banks, firms closely monitoring central bank climate communication, and firms with higher exposure to weather-related risks and opportunities. This likely reflects strategic responses to anticipated regulatory and market shifts.