GREEN BOND FINANCING AND CORPORATE ENVIRONMENTAL RESPONSIBILITY: EVALUATING THE ROLE OF SUSTAINABLE DEBT INSTRUMENTS IN ADVANCING THE GLOBAL SUSTAINABLE DEVELOPMENT AGENDA

Abstract

As global environmental challenges escalate, green bonds have emerged as a transformative financing mechanism aligning corporate capital with sustainability objectives. This study investigates the role of green bond financing in enhancing corporate environmental responsibility (CER) and driving progress toward the United Nations Sustainable Development Goals (SDGs). The research evaluates whether green bond issuance is genuinely linked to improved sustainability performance or if it merely signals symbolic compliance. The study had three core objectives: (1) to examine the effect of green bond issuance on corporate environmental outcomes such as emissions intensity and ESG ratings, (2) to analyze investor behavior and demand patterns for green financial instruments, and (3) to assess the effectiveness of regulatory frameworks in ensuring transparency and credibility in the green bond market. A mixed-methods research design was employed. Quantitative analysis drew on panel data from 85 multinational firms in sectors including energy, real estate, and transportation that issued green bonds between 2016 and 2024. Environmental performance metrics and third-party verification data were examined. Additionally, qualitative interviews with sustainability managers, investment analysts, and regulatory stakeholders provided insights into perceived benefits, challenges, and risks such as green washing. Findings revealed that firms issuing green bonds generally achieved stronger environmental disclosures and ESG improvements, particularly under rigorous external assurance frameworks. Green bonds, therefore, hold significant promise for sustainable finance if backed by enforceable standards.