Green Finance

‍What is Green Finance?

Green finance refers to financial instruments and solutions that support environmentally sustainable development. The aim of green finance is to direct capital towards projects that promote the sustainable use of natural resources and the transition and the transition to a low-carbon economy, without acceleration climate change. Sustainable finance, in turn, is broader concept that also includes green finance. Sustainable finance takes into account not only environmental considerations, but also broader social aspects and issues related to good governance.

In recent years, green finance has gained a much more significant role. Its growth has been driven by general trends and the European Union’s climate goals. Investors also increasingly expect responsibility from companies, and businesses seek competitive advantage through sustainability. Green finance guides companies towards more responsible practises and support the shift to a low-carbon economy.

Forms of Green Finance

Green finance covers a wide range of financial instruments that companies can utilize in their operations.

• Green bonds are instruments where financing is directed to environmentally friendly investments, such as renewable energy production. For example, Citycon has issued several green bonds, the most recent being a €450 million bond in April 2025. In Citycons’s case, green finance support the development of sustainable, low-emission real estate.

• Green loans allow companies to finance responsible and sustainable investments at more favorable terms. A good example is the European Investment Bank’s €150 million loan to Helen Oy, allocated to replacing fossil fuel heating plants with renewable energy. This green loan financed a significant 72% share of the entire investment.

• Green investment funds have also become significantly more common. These funds focus on companies and projects that operate in line with sustainable development and environmental goals.

In addition, the public sector provides support mechanisms tied to the same criteria of sustainable business operations.

How can companies benefit from green finance?

Green finance offers companies many opportunities and benefits, making it worthwhile to adapt operations to qualify for it. Responsible business practices can directly affect the cost of financing, making green finance solutions economically attractive. Beyond direct financial benefits, acting responsibly also improves a company’s reputation and overall competitiveness, presenting the company as an appealing option for both financiers and customers.

Sustainability reporting and green finance

Accessing green finance requires not only responsible operations but also the ability to reliably demonstrate their impacts. Transparent and comparable reporting is therefore crucial for obtaining green finance. By reporting on their activities, companies can easily meet financiers’ requirements. A well-executed sustainability reporting project can open the door to more affordable green financing.

How can Sustashift help your business?

Sustashift offers a wide range of services related to sustainability reporting and responsibility. Our reporting solutions cover different levels depending on your company’s needs:

• CSRD reporting

• The EU’s broad, partly mandatory Corporate Sustainability Reporting Directive, covering environmental, social, and governance aspects.

• VSME reporting

• The EU’s new voluntary reporting standard for companies not covered by the CSRD. The EU recommends companies report in accordance with the VSME standard.

Sustashift also provides advisory services related to green finance:

• We can help financiers identify suitable projects for sustainable financing and assist companies in finding financiers.

• We can support loan agreement drafting and negotiation, as well as preparing prospectuses for bonds.

Interested?

Contact Sustashift, and we will be happy to help you find the most suitable reporting solution or way to utilize green finance.

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