An already winning product improved in 2021, with the addition to the Bloomberg MSCI Green Bond Index of criteria covering development of rail infrastructure.

It is the sixth year in a row that the index has claimed the Environmental Finance Bond Award for Index of the year, in a resounding vote of confidence from the green bond market for an index first launched in 2014.

For inclusion to the index, self-labelled green bonds are evaluated by MSCI ESG Research against an independent methodology to assess if they have a net environmental benefit, verifying each security's use of proceeds fall within one of seven categories: Alternative Energy, Energy Efficiency, Pollution Prevention & Control, Sustainable Water, Climate Adaptation, Green Building and Others. Additionally, issuers must outline a process for project evaluation, management of proceeds and ongoing reporting.

MSCI said the addition of criteria to include development of rail infrastructure for freight – subject to this not being dedicated to fossil fuel transportation – was made because the development of rail infrastructure for freight "will promote a modal shift in transportation from more energy intensive air-based and road-based freight transport".

MSCI said that, since 2020, the most common grounds for a bond being considered ineligible was bonds' use of proceeds. For example, in 2021 it excluded a green bond expected to fund biochemicals and bio composites. The index does not consider this category as "green".

It attributed the ongoing success of its product to a team of more than 300 specialised environmental, social and governance analysts who determine whether green bond issuances qualify for inclusion.