The price of frequent issuance: the value of information in the green bond market

Information asymmetry related to environmental impacts and greenwashing-related reputational risks poses a key challenge for green bond market development. Information enhancers-such as green labels, certifications, and external reviewers-help reduce information asymmetry, thereby lowering bond yields. This study examines whether frequent green bond issuance, as a new information channel, is priced in as frequent issuers offer greater information transparency and signal stronger environmental commitment. Using global green bond issuance from 2014 to 2019, we found that on average, infrequent green bond issuers pay 114–177 basis points more than frequent green bond issuers. Results from the Blinder-Oaxaca decomposition further show that 8 basis points of this yield difference cannot be explained by common pricing factors, partly reflecting the value of information. These findings show that green bond issuers can cost-efficiently convey information via frequent issuance. Policy makers should encourage frequent green bond issuance to lower information asymmetry, thereby boosting green investment and fostering green recovery.