This study aims to examine the perspectives of Indian retail investors on green municipal bonds. This study provides insights into investors’ understanding of green municipal bonds as investment avenues and their priorities. This study also focuses on investors’ opinions on the challenges associated with the development of green municipal bonds in India and suggestions based on their experiences and priorities.
For this study, the researchers primarily relied on semi-structured in-depth interviews with 16 retail investors who are closely associated with finance and sustainability using purposive sampling. Using an interpretivist approach, the analysis is conducted by identifying the qualitative themes. Additionally, the linear best and worst method developed by Rezaei et al. (2016) was used to quantify the derived findings.
The results of this study reveal that although Indian retail investors are willing to invest in environmental causes, they expect the government to take enhanced initiatives for green municipal bonds, as in the case of the insurance industry or electoral bonds. They are aware of the performance of municipalities and the reliability of projects. However, they are concerned about administration and bureaucratic involvement in the issue. Apart from this, the corporate form of the issue structure for local urban bodies does not seem apt. They expect greater accountability, responsibility and efficiency from higher tier governments in the context of green municipal bonds, as they fear a higher likelihood of greenwashing.
This study holds significance in the context of research that provides insights into retail investors’ opinions on green municipal bonds in India. The novelty of this study lies in its capability to provide guidelines from the investors’ perspective in implementing the policy framework of sustainably financing urbanization, not only in India but also in all emerging economies. In addition, the type of structure that India holds as a democracy significantly differentiates this study from prior studies.
