MRV System Design: Recommendations for Chinese Green Bonds

This report by the Climate Policy Initiative (CPI) evaluates Monitoring, Reporting, and Verification (MRV) practices for green bonds in China, comparing them to international standards. It identifies significant gaps in reporting quality and transparency, particularly among enterprise bonds, and provides regulatory and incentive-based recommendations to enhance market trust and effectiveness.

• Reporting quality for Chinese green bonds varies significantly by bond type and regulatory regime. Financial bond issuances generally exhibit the highest quality of reporting, followed by mid-term notes. Conversely, asset-backed securities (ABS), corporate bonds, and enterprise bonds—the latter of which have no reporting mandate—show poor reporting quality.
• Offshore green bonds typically provide higher transparency and more granular reporting than onshore issuances, indicating that Chinese issuers are capable of meeting the more stringent expectations of international investors.
• Public access to green bond information in China is limited and fragmented. In a review of 387 issuances, 10% had no publicly available information. For bonds issued before September 2018, only 32 out of 270 provided both pre- and post-issuance documents on the issuer's own website, forcing data collection from multiple sources like the Shanghai and Shenzhen Stock Exchanges, NAFMII, and CCDC.
• External review practices are inconsistent across bond types. While 73% of onshore green bonds by value received pre-issuance external review, post-issuance verification was available for only 59% by value. Financial bonds have the highest rate of review, while enterprise bonds have the lowest.
• China's MRV system lacks the depth and standardization found in international frameworks such as the EU Green Bond Standard (EU-GBS) or the ASEAN Green Bond Standards. Specifically, China lacks a standard methodology for calculating environmental impact metrics and does not require the disclosure of project refinancing details, which are critical for determining additionality.
• The report identifies several Chinese issuers as examples of best practice, including ICBC, China Development Bank, Industrial Bank Co. Ltd., and Poten Environment. These entities provided project-level financial and environmental impact reporting and underwent external review throughout the entire issuance and reporting process.

APA

Escalante, D., Choi, J., Chin, N., Cui, Y., & Larsen, M. L. (2020). MRV System Design: Recommendations for Chinese Green Bonds. Climate Policy Initiative. https://www.climatepolicyinitiative.org/wp-content/uploads/2020/06/MRV-System-Design-Recommendations-for-Green-Bonds-in-China.pdf

Chicago

Escalante, Donovan, June Choi, Neil Chin, Ying Cui, and Mathias Lund Larsen. MRV System Design: Recommendations for Chinese Green Bonds. Climate Policy Initiative, 2020. https://www.climatepolicyinitiative.org/wp-content/uploads/2020/06/MRV-System-Design-Recommendations-for-Green-Bonds-in-China.pdf.

Wikipedia

{{cite report |last1=Escalante |first1=Donovan |last2=Choi |first2=June |last3=Chin |first3=Neil |last4=Cui |first4=Ying |last5=Larsen |first5=Mathias Lund |title=MRV System Design: Recommendations for Chinese Green Bonds |publisher=Climate Policy Initiative |date=June 2020 |url=https://www.climatepolicyinitiative.org/wp-content/uploads/2020/06/MRV-System-Design-Recommendations-for-Green-Bonds-in-China.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{escalante2020mrv, author = {Escalante, Donovan and Choi, June and Chin, Neil and Cui, Ying and Larsen, Mathias Lund}, title = {{MRV System Design: Recommendations for Chinese Green Bonds}}, institution = {Climate Policy Initiative}, year = {2020}, month = jun, url = {https://www.climatepolicyinitiative.org/wp-content/uploads/2020/06/MRV-System-Design-Recommendations-for-Green-Bonds-in-China.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }