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Sustainability-linked bonds (SLBs) offer a powerful alternative to green bonds by tying general financing to clear sustainability targets—rewarding success and penalizing failure. After an initial boom, global SLB issuances dipped due to concerns over greenwashing. Yet, a resurgence in credible, science-aligned SLBs—particularly in Europe, Asia-Pacific, and Latin America—signals renewed investor trust. High-emitting sectors are embracing SLBs, widening ESG access, while regulators push for transparency and robust verification. Landmark issuances, such as Uruguay’s sovereign SLB and Snam’s Scope 1–3 bond, show growing ambition. If implemented rigorously, SLBs could play a transformative role in global decarbonization efforts. Authenticity and ambition remain key.

Not all that’s labeled “green” is truly sustainable. As ESG certifications and ratings flood the market, many finance and sustainability professionals are beginning to ask tough questions. Why do some green bonds fund fossil fuel-linked projects? How can a company score high on ESG while harming the environment? In this editorial, we explore how current frameworks and certifications often miss the mark—and how that gap fuels widespread greenwashing. Through global examples—from the EU Taxonomy to MSCI ratings to LEED-certified buildings—we unpack where the system breaks down, and what credible sustainability really looks like. If you’re navigating ESG decisions, this article offers a practical lens to assess labels more critically and avoid being misled by appearances.