Which category of bonds is primarily focused on promoting environmental benefits?

Green bonds are specifically designed to finance projects that have positive environmental impacts. These bonds are typically issued by governments, corporations, or other organizations to raise funds specifically for projects such as renewable energy, energy efficiency, pollution prevention, and sustainable water management. The primary focus of green bonds is to support initiatives with clear environmental benefits, which is what distinguishes them from other types of bonds.

Sustainability bonds, while promoting a mix of environmental and social benefits, do not exclusively target environmental projects. Similarly, social bonds focus on projects with social objectives, such as affordable housing or education, rather than specifically on environmental issues. Social impact bonds are a financing mechanism that ties funding to the achievement of specific social outcomes, rather than directly addressing environmental concerns. As such, green bonds stand out as the category specifically oriented towards addressing and promoting environmental benefits.