Development of Green Finance

Green finance refers to financing activities that support environmental quality improvement, climate change response, resource conservation and efficient utilization. It is an important means to guide investment to green and low-carbon industries.

Since China issued the Green Credit Guidelines in 2012, green finance has developed rapidly from scratch. In 2016, the People's Bank of China issued and implemented the Guidelines on Building a Green Financial System, which became the world's first green financial policy framework formulated by a central government department. In the same year, China held the G20 presidency and introduced green finance into the G20 framework for the first time. Since 2017, the State Council has approved green finance reform and innovation experiments in "six provinces (autonomous regions) and nine regions". It achieved a series of fruitful results, effectively supporting the green development and transformation of local industry.

After more than ten years of development, China has initially formed a multi-level green financial products and market system, including green loans, green bonds, carbon financial products and other financial products. According to the People's Bank of China, by the end of 2021, the outstanding green loans in both local and foreign currencies amounted to 15.9 trillion yuan and the domestic green bond balance is about 1.1 trillion yuan.

In addition to improving its own system construction, China's green finance system is also actively integrating with international standards. During the United Nations Climate Change Conference in 2021 (COP 26), China and the EU released the Common Ground Taxonomy: Climate Change Mitigation, based on their current green finance policies.

Based on the green industry and finance research strengths of Tsinghua University and the rich construction and operation experience of China Three Gorges Corporation, Tsinghua-CTG Joint Center for Climate Governance and Low-carbon Transformation will research the innovation and practices of green finance policies and products in China and internationally. Through policy and case studies, the center will support enterprises to use green financial products to carry out green and low-carbon transformation, and provide timely suggestions for the development of green finance in China. The main research topics include:

1.China's green finance policy

The center will analyze China's green finance policy system, focusing on the support scope, issuance methods, financing cost advantages, and the impact on corporate green project financing of green credit, green bond and other policies.

2.International green finance development

The center will study green finance policies and products in major international capital markets, focusing on identifying green financial support that Chinese enterprises can obtain when investing in overseas energy conservation and emission reduction projects.

3.Carbon finance practices and latest development

Through studying spot and derivative products of carbon assets, carbon allowance, and carbon credit, the center will discuss how enterprises manage carbon assets through carbon financial products.

4.Information disclosure on corporate response to climate change

The center will study information disclosure requirements under the current climate and financial regulatory system, and provide suggestions on policies and implementation plans for related industries to further improve the quality of enterprises' climate change information disclosure.

Links to related policy documents:

Date	Document
2022/04/21	Industrial Standards: Carbon Financial Products （JR/T 0244—2022）
2021/11/04	Common Ground Taxonomy: Climate Change Mitigation
2021/07/01	Green Finance Assessment Programme for Banking Institutions
2021/04/21	Green Bond Endorsed Projects Catalogue (2021 Edition)
2021/01/04	Performance Evaluation System of Commercial Banks
2020/05/29	Green Bond Endorsed Projects Catalogue (2021 Edition) (Draft Soliciting Comments)
2019/12/30	Working Guidance for Promoting High-quality Development of the Banking and Insurance Industries
2018/01	Notice on Establishing Special Statistical System for Green Loans
2017/12	Implementation Plan for Green Bank Evaluation of China's Banking Industry (for Trial Implementation)
2017/03/22	Business Guidelines on Green Debt Financing Instruments for Non-Financial Enterprises
2016/08/31	Guiding Opinions on Building a Green Financial System
2016/03	Notice on Launching the Pilot Program of Green Corporate Bonds
2015/12/31	Green Bond Issuance Guidelines
2014/06/27	Key Performance Indicators of Green Credit Implementation
2013	Green Credit Statistics
2012/02/24	Green Credit Guidelines