The European Investment Bank (EIB) has joined a working group on green agriculture bonds, part of an attempt to avoid “green washing” of projects.

The 13-strong committee, which also includes academics and representatives of NGOs, has been set up by the Climate Bonds Initiative to allow investors to tackle deforestation and the impact of climate change on agriculture, chief executive Sean Kidney said.

“The right kinds of investment in agriculture also have the potential to help sequester enormous amounts of carbon,” he added.

Working group lead Tania Havemann said she expected a large green agricultural bond market to develop in the coming years.

“The expert group will develop clear and public criteria to help investment decision-making,” she said.

“Certification under the Climate Bonds Standard will provide investors with assurance about the environmental benefits of these projects.”

David Ganz, chief of party of a USAID project to lower emissions in Asian forestry, said a standard for land use would reduce the risk of poorly designed projects and “green washing”, where any project could be sold to an investor as green.

“We sincerely hope this effort will promote confidence to the market when selecting certified projects with the Climate Bonds Initiative certifications,” he said. 

Chris Knowles, head of the climate change and environment division at the EIB, has joined the group.

Other members of the working group include Annett Thiele of Germany’s Greifswald University, Jerry Seager of the Verified Carbon Standard, and Paul Chatterton, director of the UN-backed Reducing Emissions from Deforestation and Forest Degradation (REDD) at the World Wildlife Fund (WWF).

A recent report by the Climate Bond Initiative said the climate bond market recently exceeded $0.5trn (€369bn).

The initiative also announced the details of draft property green bond standards in June.