Journal of Contemporary Issues in Business and Government

Abstract

The paper covers the aspects of using Green bonds as part of international reserve management to pursue sustainable development goals set forth by the UN. The authors sought to explore the potential of Green bonds as alternative financial assets for the investment of reserves, taking into account the objectives of the Bank of Russia in this area. The study relied on quantitative analysis and qualitative methods, such as systematisation and interpretation of releases of central banks and international organisations. It was shown that the transformation of policy objectives and priorities in international reserve management to reduce the reliance on the US dollar, integrate non-economic risk considerations, and improve returns has consolidated interest in Green bonds. In terms of safety and returns, Green bonds meet the criteria of assets used for the investment of reserves; adding them to portfolios would provide the desired diversification, structure enhancement, and risk reduction, improving trust among investors and creditors. The authors conclude that amid intensifying international pressures and sanctions, euro-denominated Green bonds provide an opportunity to enhance the structure and quality of international reserves of the Bank of Russia. The proposal to include euro-nominated Green bonds in the reserve portfolio of the Bank of Russia represents the authors' original contribution toward the development of international reserve management in the current context