Page 19 - Research on Financial Development Mechanism and Path of Forestry Carbon Sequestration in Developing Countries under Double Carbon Targets

Chapter 1 Carbon Asset Management Practice

was put forward, the country actively sought for economic and energy transformation.
Market participants doubted the development of traditional manufacturing industry,
fossil energy industry and other industries, and the transformation risk appeared. On
the one hand, high-carbon enterprises face the dilemma of obtaining external recogni-
tion; On the other hand, the risk exposure of financial institutions holding high-carbon
corporate financial assets will increase with the irrational cognition, which will affect
the financial stability. Green finance will guide market participants to be rational and
bring environmental and climate risks into the scope of management. Through research
and development of environmental risk measurement tools, identify and quantify risks,
prevent risks while guiding the main body to avoid risks; Through the promotion of in-
formation disclosure, investors and financiers are encouraged to deepen their awareness
and attention to climate-related risks, and enterprises are required to pay attention to
the transformation layout while providing financial institutions with the implementation
basis for investment and financing risk judgment.

1.2.3 Green finance can guide the formation of a reasonable market pricing

At present, some financial institutions can only identify green enterprises and green
projects and issue uniform interest rate incentives, which cannot effectively reflect the
true internal value of green assets. Green finance can effectively solve this problem,
especially the carbon finance in green finance can provide beneficial reference for rea-
sonable market pricing. With the establishment of a national carbon market, a unified
carbon price different from the regional carbon market with different carbon prices
has been initially formed, and the carbon market has generally run smoothly after the
end of the current first performance cycle. Financial instruments such as carbon quota
mortgage and pledge formed based on carbon trading also further expand the financial
attributes of carbon assets and become a new way for enterprises to finance. Although
China has not yet fully opened up carbon market derivatives, from the existing practice
in the EU and other regions, with the development and maturity of the carbon market,
including the expansion into the scope of the main body, institutional investors entering
the market, the opening up of carbon financial derivatives, etc., the pricing based on
carbon trading will be further optimized in the future.

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