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Green Initiative Becomes a Signatory of the Principles for Responsible Investment (PRI): A Commitment to Climate-Responsible Investments

We are thrilled to announce that Green Initiative has officially joined the Principles for Responsible Investment (PRI) as a signatory. This important milestone reinforces our commitment to advancing climate-responsible investments worldwide and furthers our mission to drive sustainable finance that creates lasting environmental impact. What is PRI and Why is it Important? PRI is an international network of investors committed to incorporating environmental, social, and governance factors into financial decision-making. By adhering to PRI’s six key principles, signatories commit to: 1. Incorporating climate issues into investment analysis – Assessing climate risk and social impact when making investment decisions 2. Being active owners – Signatories engage in shareholder activism, advocating for sustainable corporate governance and responsible business practices. 3. Seeking appropriate disclosure on sustainability issues – Investors encourage companies to be transparent about their sustainability performance, climate impact, and corporate governance policies. 4. Promoting the acceptance and implementation of the Principles within the investment industry – Financial institutions work to advance responsible investment practices by educating stakeholders, partners, and policymakers. 5. Enhancing effectiveness by working together to implement the Principles – Collaboration among PRI signatories strengthens industry-wide efforts to develop innovative, sustainable finance solutions. 6. Reporting on progress toward implementing the Principles – Signatories provide regular sustainability reports, tracking their commitment to responsible investment and disclosing their climate impact and sustainability performance. As climate change accelerates, PRI’s role is critical in fostering sustainable investment strategies that balance financial returns with positive environmental and social impact. By implementing these six principles, investors contribute to a low-carbon economy, promote corporate transparency, and drive meaningful environmental change Green Initiative’s Role in PRI’s Commitment As a third-party verifier and advisory services provider, Green Initiative supports financial institutions, banks, and investors in achieving and maintaining their climate mitigation and nature positive investment targets. We provide independent climate and nature assessments that: Leveraging Innovation for Climate Accountability: Science based Solutions and the Climate Performance Platform Green Initiative leverages cutting-edge technology and science-based solutions to enhance climate accountability through: This AI-powered approach boosts environmental accountability while actively supporting global reforestation and ecosystem restoration efforts. By providing a data-driven approach to climate disclosure, CPP enhances corporate transparency and investor confidence in sustainable investments. Green Initiative´s Commitment to a Sustainable Future The financial sector holds immense power to drive global climate action. By joining PRI, Green Initiative plays a critical role in ensuring that investments align with climate commitments: • Ensuring impact-linked financial instruments align with climate objectives: we conduct investment due diligence, verifying that funds support sustainable energy, green infrastructure, and carbon reduction projects. • Tracking investee´s compliance with climate and nature impact goals: Through ongoing environmental performance assessments, we ensure companies meet climate and nature criteria to maintain financing agreements. • Facilitating financial term adjustments based on climate performance Financial institutions can adjust interest rates, lending terms, or investment priorities based on a investee´s progress. This process fosters trust, transparency, and accountability, ensuring that capital flows actively contribute to a low-carbon, sustainable economy. Together, we can build a future where responsible investments play a pivotal role in mitigating climate change and fostering positive outcomes for our planet. Ready to align your investments with climate action? Contact us today to explore how Green Initiative can help you achieve measurable climate mitigation impact through responsible investing. Contact us at https://greeninitiative.eco/contact/ This article was written by Tatiana Otaviano from the Green Initiative Team.

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Carbon Credits in 2025: A Turning Point for Climate Action?

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The global carbon market is reaching a critical juncture. As climate action accelerates, governments, businesses, and financial institutions are increasingly integrating carbon credits into their sustainability strategies. However, challenges such as transparency, credibility, and market fragmentation persist. Could 2025 be the year that carbon credits transition from a supplementary tool to a mainstream climate action mechanism? Why Carbon Markets Matter for Climate Action Carbon credits play a crucial role in reducing greenhouse gas emissions, enabling companies to offset their carbon footprint through verified climate and nature positive initiatives. As regulatory frameworks evolve and demand for high-integrity carbon credits rises, businesses face growing pressure to make credible sustainability commitments. Wendy Chen, in her article for Climate & Capital Media, explores the key drivers shaping the carbon market, including policy incentives, technological advancements, and small and medium-sized enterprises (SMEs). Inspired by her insights, we examine whether 2025 could be the defining moment for carbon markets. Will Policy Incentives Make 2025 a Game-Changer? Governments are increasingly shaping carbon markets with stronger policies, aiming to ensure the credibility and accessibility of carbon credits. The integration of voluntary and compliance markets is a critical factor in determining whether 2025 will be a breakthrough year. Technological Innovations Strengthening Carbon Markets With the rise of artificial intelligence, cloud computing, and data centers, the tech sector’s carbon footprint has grown significantly. Leading corporations are responding by integrating carbon credits into their sustainability roadmaps, helping shape the future of carbon markets. SMEs and the Growing Role of Carbon Credits Historically, large corporations dominated carbon markets, but SMEs are now becoming key players in both the demand and supply of carbon credits. New Standards Enhancing Carbon Market Integrity As carbon markets scale, new standards are emerging to ensure accountability. Organizations like the Integrity Council for the Voluntary Carbon Market (ICVCM) and the Science-Based Targets initiative (SBTi) are raising the bar for carbon credit verification, helping build trust and drive market growth. The Expanding Role of Nature-Based Solutions Nature-based solutions such as reforestation, blue carbon projects, and regenerative agriculture are crucial for achieving climate and nature positive outcomes. These approaches help absorb CO₂ while preserving biodiversity and supporting local communities. Increasing investment in these projects will be vital in ensuring the integrity and impact of carbon credits. Are Carbon Removal Technologies the Future? Beyond traditional carbon offsets, businesses are investing in direct air capture (DAC), biochar, and enhanced weathering to permanently remove carbon from the atmosphere. These emerging technologies are gaining traction as companies seek long-term, high-impact solutions for carbon neutrality. Beyond Offsetting: Corporate Climate Strategies for 2025 While carbon offsetting remains an essential tool, many corporations are shifting towards insetting, integrating emission reduction measures directly within their supply chains. Companies like Nestlé and Unilever are investing in regenerative agriculture to cut emissions at the source, marking a broader transition toward holistic sustainability strategies. Financial Institutions and the Growth of Carbon as an Asset Class Banks, asset managers, and institutional investors are increasingly incorporating carbon credits into green bonds, carbon ETFs, and structured carbon finance mechanisms. As carbon markets mature, financial backing will be essential for scaling high-quality, impact-driven climate projects. Challenges and Opportunities in 2025 While the carbon credit market is expanding, hurdles such as additionality concerns, double counting, and verification inconsistencies still exist. Addressing these challenges will be crucial to ensuring carbon markets deliver real climate action and economic benefits. If 2025 is to be the turning point for carbon credits, stakeholders must work collaboratively to improve transparency, accessibility, and governance. With strong regulatory frameworks, technological innovation, and financial backing, carbon markets could become a cornerstone of global decarbonization efforts. At Green Initiative, we believe in advancing high-integrity carbon markets and guiding businesses on their path to net-zero emissions. As demand for climate and nature positive solutions grows, we support organizations in leveraging carbon finance opportunities for tangible environmental impact. This article was inspired by Wendy Chen’s insights in Climate & Capital Media. Her analysis provides valuable perspectives on the evolving carbon market landscape. Read her article here.

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Financing the Green Future: Principles for Tracking Climate Mitigation Investments

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As most of the world intensifies efforts to combat climate change, the role of climate finance has become increasingly vital. The Paris Agreement has set an ambitious goal: to keep global temperature rise well below 2°C, with a strong commitment to limiting it to 1.5°C. Achieving this target requires a fundamental transformation of the global economy, shifting investments away from high-emission industries and toward nature-positive solutions, such as renewable energy, sustainable transport, and green infrastructure. However, ensuring that financial flows genuinely align with climate goals requires a transparent, standardized framework for tracking and reporting climate mitigation investments. The Common Principles for Climate Mitigation Finance Tracking, developed by multilateral development banks (MDBs) and the International Development Finance Club (IDFC), serve this purpose by establishing clear eligibility criteria for climate-positive investments while excluding those that undermine long-term decarbonization efforts. This article explores the key principles of climate mitigation finance tracking, the sectors benefiting from green investments, and the future of financial strategies aimed at accelerating climate action. The Role of Climate Mitigation Finance Climate mitigation finance is a crucial tool for supporting the transition to a net-zero economy. It ensures capital is directed toward investments that: 1. Reduce or Avoid Greenhouse Gas (GHG) Emissions Reducing greenhouse gas (GHG) emissions is a core pillar of climate mitigation finance, as it directly addresses the root cause of global warming. By shifting investments toward clean energy, low-emission transport, and energy-efficient infrastructure, we can significantly cut carbon emissions while driving economic growth and innovation. Key strategies include transitioning from fossil fuels to renewable energy sources, electrifying transportation systems, and enhancing energy efficiency in buildings and industries. These measures not only reduce dependence on high-carbon energy but also create a foundation for a sustainable, net-zero future. 2. Enhance Carbon Sequestration While reducing emissions is crucial, it is equally important to remove existing carbon dioxide (CO₂) from the atmosphere to mitigate climate change effectively. Carbon sequestration plays a key role in this effort by capturing and storing CO₂ through natural and technological solutions. Investments in reforestation and afforestation restore forests that act as natural carbon sinks, while regenerative agriculture enhances soil health, increasing its capacity to store carbon. Additionally, carbon capture and storage (CCS) technologies provide an industrial-scale solution by trapping CO₂ from power plants and factories before it enters the atmosphere. These approaches work together to offset emissions and contribute to a climate-positive economy. 3. Transition High-Emission Industries Heavy industries such as steel, cement, and chemicals are among the largest contributors to global carbon emissions. Decarbonizing these sectors is essential for achieving a net-zero economy, but doing so requires targeted investments in innovative, low-carbon technologies. One of the most promising solutions is green hydrogen, which serves as a clean alternative to fossil fuels in industrial processes. Additionally, circular economy initiatives—such as waste reduction, recycling, and material reuse—help lower emissions by minimizing resource consumption. The adoption of sustainable construction materials, such as carbon-negative cement and recycled steel, further reduces the environmental impact of the building sector. Without a robust system for tracking climate-positive investments, financial flows could be misallocated to projects that offer only short-term emission reductions while reinforcing long-term fossil fuel dependency. The Common Principles ensure that financial institutions prioritize truly sustainable climate investments. Key Principles for Climate Mitigation Finance Tracking The Common Principles categorize climate mitigation finance into three distinct groups, ensuring investments are aligned with the Paris Agreement and contribute to a nature-positive global economy. 1. Negative- or Very-Low-Emission Activities To achieve a net-zero future, investments must prioritize projects that produce little to no greenhouse gas emissions while actively contributing to deep decarbonization. These activities are fully aligned with global climate targets and represent the most effective pathways toward long-term sustainability. Key areas of investment include renewable energy, such as solar, wind, hydropower, and geothermal, which replace fossil fuels and provide clean, sustainable electricity. Additionally, carbon sequestration projects—including reforestation, soil carbon restoration, and blue carbon initiatives (e.g., mangrove and seagrass restoration)—help remove CO₂ from the atmosphere. Further advancements in low-carbon industrial production are also essential. Technologies such as green hydrogen, carbon-negative cement, and bioplastics provide viable alternatives to traditional, high-emission materials, reducing the environmental impact of key industries. These projects form the foundation of a climate-positive economy and ensure that financial investments drive real, lasting change toward a sustainable world. These projects are fully aligned with net-zero targets and drive deep decarbonization. Examples include: 2. Transitional Activities While the ultimate goal is a fully decarbonized economy, some industries and systems require an intermediate phase to reduce emissions before achieving full sustainability. Transitional activities play a crucial role in this process by improving the efficiency of existing infrastructure while minimizing reliance on fossil fuels. However, these projects must be carefully managed to avoid long-term carbon lock-in and ensure they serve as stepping stones toward net-zero solutions. Key transitional strategies include industrial energy efficiency upgrades, which can reduce emissions by 30–50% through advanced technologies such as waste heat recovery, automation, and energy-efficient manufacturing processes. In the transport sector, hybrid vehicle adoption provides an interim solution, lowering emissions while paving the way for full electrification and hydrogen-powered mobility. Additionally, retrofitting buildings with energy-efficient solutions, such as heat pumps, green roofs, and smart grid integration, helps reduce energy consumption and carbon footprints. By ensuring that transitional activities remain aligned with long-term decarbonization goals, financial investments can maximize climate benefits while accelerating the global shift toward sustainable energy, transport, and industry. These projects reduce emissions in existing systems but still involve some reliance on fossil fuels. They must not create long-term carbon lock-in. Examples include: 3. Enabling Activities Achieving a net-zero economy requires not only direct emissions reductions but also a strong support system that enables the widespread adoption of climate-positive technologies and practices. Enabling activities play a crucial role in facilitating this transition by providing the financial, regulatory, and technological infrastructure needed to scale up green investments. Key enabling strategies include green bonds and sustainability-linked finance mechanisms, which provide dedicated funding for climate mitigation projects. These financial instruments

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Positive Impact Investment: The New Frontier of Investments for Climate Action and the Role of Verification Organizations

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In recent years, impact investments have gained prominence as a powerful tool to finance initiatives that generate tangible social and environmental benefits. Within this context, impact investments have emerged as innovative financial instruments, offering a unique opportunity to channel resources toward combating climate change and promoting sustainable and social solutions. What Are Impact Investments? Impact investments are a type of debt instrument with a key distinction: the payments are tied to achieving specific social, climate or environmental impact targets. In other words, the repayment is directly linked to the borrower’s ability to meet measurable objectives, such as reducing carbon emissions or restoring ecosystems. This structure is relevant to climate finance because it allows investors to ensure that their capital makes a significant contribution to mitigating climate risks while also generating a financial return. This innovative structure offers a win-win scenario: Transforming Climate Financing: A Paradigm Shift in Resource Allocation The importance of these investment instruments goes beyond being mere financial tools. They represent a paradigm shift in how resources are allocated to mitigate environmental impacts. By effectively channeling capital to companies and projects committed to addressing climate change, these investments drive transformation within the private sector and align financial interests with global sustainability goals. Traditional financing models often lack accountability when it comes to environmental impact. Impact investments flip the script by directly linking financial performance to climate outcomes. This approach channels resources into projects that actively address climate risks while fostering long-term economic resilience. But achieving these lofty goals requires more than just good intentions. For these investments to work, robust systems for monitoring, evaluating, and verifying outcomes are essential. The Role of Independent Verification For impact investments to be effective and truly deliver the desired outcomes, independent evaluation and ongoing verification of results are crucial. This is where organizations like Green Initiative play a vital role. As a specialized third-party entity, Green Initiative provides advisory, certification, and monitoring services for financial institutions—such as funds and banks—that offer financial instruments linked to positive climate and environmental impacts. This is where third-party organizations like Green Initiative step in. As a trusted verifier, Green Initiative ensures that the impacts promised by borrowers are not only measurable but also delivered transparently and effectively. Here’s how: How Green Initiative Ensures Impact Leveraging its expertise, Green Initiative ensures that climate and environmental impacts are measured and monitored accurately and transparently, guaranteeing that resources allocated to these projects are utilized effectively. This advisory role, often referred to as third-party verification, extends beyond merely tracking results. It also helps ensure that borrowers meet the climate mitigation goals agreed upon in their contracts with funders, such as reducing CO2 emissions or enhancing biodiversity. Strengthening Credibility and Transparency One of the standout features of impact investments is their ability to foster transparency and accountability in climate financing. By linking financial success to environmental performance, these instruments ensure that resources are used where they matter most. For example, a company borrowing funds to transition to renewable energy can have its loan terms adjusted based on measurable reductions in carbon emissions. This accountability incentivizes borrowers to achieve their goals while giving investors confidence that their capital is making a tangible difference. By acting as an independent advisor, Green Initiative also strengthens the credibility and transparency of the process. This supervisory role builds trust among all stakeholders—investors, financial institutions, entrepreneurs, and society at large. Through rigorous and impartial audits, Green Initiative validates the impact metrics reported by borrowers, ensuring that funds are appropriately used to achieve the desired outcomes. Beyond Verification: Driving Accountability In this context, Green Initiative’s work goes beyond simply validating results. It also assists financial institutions in monitoring compliance with the impact objectives of the instrument. This can include adjustments to instrument conditions, such as modifying interest rates based on the borrower’s performance. This flexibility ensures that impact investments remain aligned with environmental objectives and promote ongoing accountability among borrowers, incentivizing them to achieve the agreed-upon goals. Positive impact investments are more than just a financial innovation—they’re a strategic approach to driving global sustainability. Here’s why they matter: Unlocking the Potential of Positive Impact Investments Positive impact investments not only offer a way to finance climate mitigation projects but also contribute to building a more sustainable and transparent economy. These investments represent a groundbreaking shift in how we finance climate action. But their success hinges on rigorous monitoring, accountability, and collaboration between stakeholders. However, to unlock their full potential, rigorous monitoring and validation of impacts must be conducted by trustworthy entities like Green Initiative. In doing so, these instruments can ensure that financial resources are effectively directed toward combating climate change, paving the way for a more sustainable future for everyone. At the heart of this ecosystem is Green Initiative, a leader in providing the oversight and expertise that positive impact investments demand. From validating outcomes to guiding borrowers and investors through the intricacies of sustainability metrics, Green Initiative ensures that these financial tools live up to their potential. Our work goes beyond audits and certifications—it helps create a culture of accountability in climate financing, paving the way for a transparent, sustainable future. Now is the time to embrace this innovative approach to climate action. Together, we can drive meaningful change and create a better future for generations to come. Written by Tatiana Otaviano, from the Green Initiative Team.

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What Are Green Bonds and Why Are Prices So Low?

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In recent years, green bonds have become a powerful financial instrument, playing a key role in addressing the global challenge of climate change and funding sustainability projects. These bonds support environmentally beneficial initiatives such as renewable energy, biodiversity conservation, and sustainable infrastructure, offering both financial returns and a tangible positive impact on the environment. Despite the promise they hold, green bond prices have been lower than expected due to several market factors. However, the future of green bonds is incredibly bright, with a growing alignment between investor demand and sustainability objectives. Understanding Green Bonds Green bonds operate like traditional bonds but serve a higher purpose—financing projects dedicated to environmental sustainability. Governments, corporations, and institutions issue these bonds to fund projects such as renewable energy development, energy efficiency improvements, and biodiversity conservation initiatives. Green bonds provide an innovative solution to global environmental issues, allowing investors to support the transition to a low-carbon economy while securing returns. Moreover, the market for green bonds is expanding rapidly. With governments and corporations pledging to meet net-zero emissions targets, the demand for green financing climate and nature positive instruments is expected to continue accelerating. Green bonds are thus well-positioned to become a mainstream financial tool for a sustainable future. Why Are Green Bond Prices So Low? Several factors explain why green bond prices have been lower recently: Increasing Supply of Green Bonds As the issuance of green bonds has surged globally, supply now outpaces demand in certain markets. However, this increase in supply is a positive sign that sustainability-focused financing is becoming mainstream. As more investors adopt ESG (Environmental, Social, and Governance) strategies, demand for green bonds is expected to catch up, potentially driving prices higher in the future. Rising Interest Rates Like all fixed-income instruments, green bonds are affected by interest rates. In a rising rate environment, newly issued bonds offer higher yields, making older green bonds less attractive. However, this is a temporary challenge. As central banks stabilize interest rates, green bonds—especially those tied to long-term climate and nature positive environmental projects—will regain their appeal. Perceived Risk of Green Projects While some green bonds finance projects in emerging sectors or developing regions, where risks may be perceived as higher, this is also an opportunity. Investors who understand the long-term potential of green technologies and climate and nature positive sustainability initiatives recognize that these bonds support transformative projects that can generate both environmental and economic returns. Greenium and Market Maturity The concept of greenium, or the premium investors have historically paid for green bonds, is evolving. As the green bond market matures and expands, greenium has diminished, making these bonds more accessible. This signals a healthy market transition, where green bonds no longer command higher prices but instead offer competitive returns, aligning with the expectations of mainstream investors. Greenium and ESG Investment Strategies Green bonds are increasingly attractive to investors seeking to align their portfolios with ESG goals. The diminishing greenium, while lowering bond premiums, actually enhances the accessibility of green bonds, offering competitive returns without sacrificing sustainability. As the market for green finance grows, companies with high ESG commitments, particularly climate and nature positive, are likely to attract more capital, driving even more innovation and positive environmental impact. For investors with a long-term view, green bonds provide a unique opportunity to support projects with positive externalities while maintaining attractive returns. This alignment of financial and environmental performance makes green bonds a compelling part of any sustainable investment strategy. A Quote on Brazil’s Green Bond Market Green bonds have emerged as an essential tool for financing sustainable projects, significantly contributing to the transition to a low-carbon economy. In Brazil, the green bond market is still in its growth phase but already shows enormous potential. Since the first issuance in 2015, the country has accumulated around USD 11.2 billion in issuances. The growth of this market in Brazil is driven by the increasing demand for sustainable investments, both from institutional investors and individuals concerned about the environmental impact of their investments. Additionally, the greenium, which is the price premium that investors are willing to pay for green bonds, is directly related to the supply and, more importantly, the demand for these bonds. This phenomenon is reinforced by the commitments made by large asset managers and financial institutions to direct resources towards projects that promote sustainability. With the growing awareness of climate change and the need for concrete actions, the green bond market in Brazil has significant room for growth. The expectation is that, with favorable public policies and the continuous engagement of the private sector, we will see a substantial increase in green bond issuances in the coming years, contributing to a more sustainable and resilient future. Quotes Marcos Lima, ESG Finance and Investment Banking – Lecturer at FEBRABAN and Coordinator of Sustainable & Climate Finance at BV Bank. A Bright Future for Green Bonds Looking ahead, the future of green bonds is incredibly promising. Several factors will fuel their growth: Increasing Regulatory Support Governments are implementing policies to promote sustainable finance, including green bonds. The European Union’s Green Bond Standard is setting the stage for stronger frameworks that ensure the transparency and integrity of green bonds. These regulations will encourage more issuers to enter the market and provide investors with confidence in the impact of their investments. Climate Commitments and Global Demand With global climate commitments like the Paris Agreement pushing governments and corporations to reduce carbon emissions, the demand for green finance will only grow. Green bonds are at the forefront of financing this transition, offering an efficient way to raise capital for large-scale environmental projects. Investor Appetite for Sustainable Assets As more investors integrate sustainability into their strategies, green bonds will continue to be a key part of the solution. The narrowing greenium makes these bonds more attractive to a broad range of investors, enabling green bonds to move from a niche product to a mainstream asset class. This growing demand, coupled with an increase in green bond issuance, is expected

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