SLBs have established themselves as innovative financial instruments that integrate sustainability into corporate finance. To this end, the bonds’ coupons are linked to predefined sustainability targets. Following a successful initial phase, the market for SLBs is currently in crisis. Against this backdrop, Dr Patricia Ruffing-Straube presented the findings of a recent empirical study.
Sustainability-linked bonds (SLBs) are regarded as a promising financial instrument for firmly embedding sustainability in corporate finance. What sets them apart is that the terms of the bonds – in particular the interest payments – are linked to the achievement of specific sustainability targets.
However, following a period of rapid growth, the SLB market now faces major challenges. Doubts about the credibility of some issues, as well as unclear standards, have shaken the confidence of many investors.
Against this backdrop, Dr Patricia Ruffing-Straube from the University of Zurich presented the findings of a recent empirical study on the future of the SLB market on 5 June 2025. Under the title ‘Sustainability-Linked Bonds Crisis: Will the label survive?’, she discussed key findings and possible solutions. It became clear that the future of the label depends largely on stricter transparency requirements, binding standards and consistent performance measurement.
The event offered fascinating insights into the current debate surrounding sustainable financial products and underlined the importance of academic analysis for the further development of responsible capital markets.
