Sustainable Finance : A Study on How Sustainable Finance Instruments are Being Implemented to Promote Sustainability in the Real Estate and Construction Industries

Sammanfattning: Human practices linked with speedy industrialization and globalization have, unfortunately,caused severe harm to the Planet. In the vicious circle for development, Countries proceededtowards forming developed economies, which resulted in rapid depletion of the available renewable and non-renewable resources. It was only after the effects of such reckless practices started showing globally (in terms of environmental issues such as climate change, rising pollution levels, etc.) that the realization about saving the Planet started settling in. Over the years, studies have been conducted to evaluate the damages caused to the Planet through several heavy industrial practices or even through smaller household practices (such as improper waste segregation and waste disposal), and attempts have been made to sensitize the world population about such issues and the growing need to incorporate sustainability intobusiness practices as well as a way of living. The Real Estate and Construction industries have been infamous for having practices which have not been considerate towards the environment. There have been numerous reports about harmful practices, such as the use of certain materials, which have had enormous emissions and have caused depletion of the environment. One of the ways the industry is now looking to make a positive impact is by adopting sustainability practices with finance, thus giving rise to the practice of ‘sustainable finance’ or ‘green finance’. This thesis focuses on studying how certain green finance instruments (sustainability linked bonds, green bonds, circular economy and impact investing) are being implemented for financing green projects and thereby promoting sustainability in the long run in these industries. The study has been conductive using a qualitative approach. The methodology involved adopting the triangulation method, including empirical data collection through extensive literature review along with conducting semi-structured interviews with professionals working iiwithin the field of green finance. The data collected was then analysed via an inductive approach.  The conclusion derived from the data collected shows a growing trend and a changing mindset (including accepting the risks involved) towards accepting the use of these green finance instruments in the best interest of the environment. The process of quantifying the impact caused by the use of green finance instruments as compared to the conventional finance methods is ongoing, and as a result, these instruments are still being researched and reworked for improvisation, which is an ongoing process. However, the presence of malpractices such as greenwashing serves as a hindrance to sustainable finance. Another major issue regarding this is the quantification of greenwashing. This also brings to light the need for increased regulation in this field. Nonetheless, it can be clearly concluded there is huge future scope for such instruments in the future.