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Sustainable investing in times of crisis: evidence from bond holdings and the COVID-19 pandemic


JRC nr: JRC125769
Publication date
5 July 2021


Using data on institutional investors’ bond holdings, we investigate the resilience of green bonds to the COVID-19 shock in a difference-in-differences framework. We find that during the COVID outbreak green bonds experience lower sales, on average, while in normal times no significant differences emerge compared with ordinary bonds. The result is robust across different investor classes and is not driven by those that have a longer-term investment horizon. Furthermore, we find that sustainability-oriented funds sell less of green bonds than their peers without a sustainability mandate. We also document that the ownership of green fixed income securities is more concentrated than that of comparable conventional bonds, and that concentration has increased in the first quarter of 2020.


FATICA Serena, PANZICA Roberto


(1.91 MB - PDF)