Comparative Legal Aspects of the EU and Russia Policy in the Field of Green Financing

With the development of globalization and the growing influence of transnational corporations and their share in the global economy, the main focus of the concept of sustainable development and green investment began to shift from the national level to the corporate level, leading to the institutionalization and formation of a green finance market [1]. More and more countries are focusing on sustainable development, of which green finance is an important part. The leading role in this matter belongs to the financial regulators. The green finance system is developing at the intersection of two areas - the financial market and environmentally friendly human activity in all its manifestations: the organization of production and the provision of services, the implementation of projects, the production of products, fundraising, investment strategies, etc. [2].

Despite the fact that at present the topic of "green" finance to a greater extent relates to the field of financing and investment, as can be expected, it will become widespread in legal science in the near future, which is predetermined by the general interest in the problems of sustainable development and the implementation of Environmental, social, and governance (ESG) principles. For example, green investments as an element of green finance, being in essence a purely financial instrument, at the same time carry an additional social component. If used properly, they can become an effective instrument of public policy. At the same time, the emergence of such a concept as green finance gives rise to a number of new legal relations that simultaneously extend to the sphere of environmental, financial, tax and a number of other branches of law. Modern jurisprudence at the international level and at the level of national legislation is called upon to institutionalize green finance, defining their niche in the field of legal relations. It should be noted that at present there is no uniform understanding of the essence of "green" finance. The OECD links green finance and investment to green development, which means achieving economic growth while reducing pollution and greenhouse gas emissions, as well as minimizing waste and increasing the efficiency of natural resource use [3].

Despite the social and economic challenges posed by the COVID-19 crisis, countries are continuing, or in some cases accelerating, the implementation of existing policies and measures aimed at greening the economy. Green measures to restore economic growth can enable countries to recover more effectively by combining economic recovery and job creation while achieving environmental goals [4].

The green economy and corporate social responsibility do not have a philanthropic nature, but are a factor of business sustainability, including such factors as image improvement, credit rating increases, investor confidence growth, customer loyalty, the opportunity to enter new sales markets, etc. The transition to a green economy largely takes place within the framework of achieving the goals set out in the Paris Agreement. In its course, concepts are developed, a system of regulation and measurement of investments is created, the size of which is estimated at tens of trillions of dollars. According to the estimates of the International Energy Agency (IEA), in order to achieve climate goals and sustainable development by 2030, it is necessary to mobilize green financing in the amount of 90 trillion dollars [5].

The economic structure of the EU and Russia has a number of significant differences, but both the Russian Federation and the EU now recognize the importance of using green finance as an important tool in finding a balance between environmental goals and financial sustainability. The importance of developing the green finance market in Russia is dictated by both environmental and economic reasons. According to the World Bank, Russia is one of the ten countries that produce the most emissions, both in absolute terms and per capita. At the same time, waste is produced twice as much as in the EU, with the incomparable size of the Russian economy [6]. If Russia is only at the beginning of the path to the formation of a green finance market, then the EU countries at this stage are forming the agenda, being the unspoken leader in the industry. However, for both the EU and Russia, there are a number of issues regarding both the definition of policy guidelines and the legal institutionalization of green finance. In the absence of legislative definitions of the concept of green finance, it would seem that some terminological certainty could be introduced by science. However, in numerous scientific studies, there is also no generally accepted approach to the definition of the term "green" finance and the concept of "green" finance associated with it. Perhaps the most meaningful is the definition of the German Development Institute, which defined green finance as a complex concept that includes all forms of investment or lending that take into account the impact on the environment and increase environmental sustainability. A key element of green finance is sustainable investment and banking, where investment and lending decisions are made based on environmental screening and risk assessment to meet environmental sustainability standards [7].

The term “green finance” is proposed to be considered in three main aspects:

1) a set of different ways of financing technological processes and projects in the field of green economic activity;

2) a set of financial institutions (banks, insurance companies, etc.) involved in the financing of environmental programs and projects;

3) financial products and services (credits, bonds, etc.) with ecological component [8].

The scientific literature identifies a number of features inherent in green financing:

- funds are directed to finance the development and implementation of “green” projects, technologies, activities;

- it is associated with low-carbon, resource-efficient, inclusive economy;

- participation of large institutional investors, as well as the expressed interest of a state;

- implementation of innovations;

- investment in natural capital, manifested in positive environmental impact;

- increase in the welfare of the population;

- financing most often comes from green bonds, green loans or green project financing;

- longer duration, etc. [9].

Modern research on issues of green financing are devoted to such issues as the assessment of the impact of the Emissions Trading Scheme of the European Union on enterprises falling under the scope of regulation of this scheme in the industrial and energy sectors [10], the role of green financing in achieving the goals of sustainable development and energy security [11], the impact of environmental taxes on CO₂ emissions in EU countries [12], an analysis of the characteristics of green bond markets to promote green financing in the world in the post-pandemic era [13], the sensitivity of the European system of environmental taxation to the economic cycle [14].

Despite the fact that the general trend is to focus on the SDGs, different regions and countries around the world are forming national green strategies for financing sustainable development in accordance with their national interests and the specifics of the economy of each country. In Russia, the formation of common approaches, principles and rules for the development of a green finance system, as well as legislation in this area, is at an early stage, steps are being taken to create a system of responsible financing and green financial instruments, which actualizes the problem and creates the need for its scientific understanding. Within the framework of this study, there was an attempt to cover some aspects of the areas above (including the issues of the legal nature and administration of environmental payments in Russia in the context of international legal regulation, issues related to the functioning of the green bond market, etc.), given that at the moment these issues are not fully considered, and the first eco-innovations implemented in the financial market require prompt and comprehensive legal response, as well as scientific understanding. Based on a review of modern studies, it can be noted that most of them are devoted to environmental and economic policy issues, and to a lesser extent to legal regulation issues. At the same time, comparative legal studies devoted to the review of Russian experience are limited and, as a rule, address only the political component of the issue. This, in turn, creates a research gap.

This study implies to analyze the current state of legal regulation of green finance in the Russia and EU, as part of the implementation of the current sustainable development agenda.

In the frame of achieving the objectives of the study, it is supposed to analyze the existing legislation of the EU and Russia in the field of green finance, while highlighting the key areas of state policy in this industry, as well as identify a number of issues that are not subject to existing legislative regulation. This, in turn, will make it possible to identify a range of issues that require a legal solution and propose measures aimed at improving existing legal mechanisms.

3.1 Institutionalization and administration of green finance in the EU against the background of world experience

Interest in the green agenda among entrepreneurs and investors is beginning to grow as they realize its importance for well-being and business development prospects [15]. In addition to the directly environmental sphere, the issue of the institutional affiliation of green finance currently has several other dimensions - political, economic and legal, which should be considered inextricably linked. Considering the issue of green finance from a legal point of view, the sphere of financial and tax law is of particular interest. At the same time, from the point of view of the formation of mechanisms for legislative regulation, the origins should be sought in the political activities of international organizations, the international institutionalization of the category of green finance.

For the United Nations, green finance plays an important role in achieving several sustainable development goals. Its environmental team is already working with public and private sector organizations, trying to bring international financial systems into line with the sustainable development agenda. Some of the activities in which UN-Environment participates include helping countries to reorganize their regulatory frameworks, for example, so that "green" borrowing meets the requirements, as well as helping to plan the public sector in a more environmentally friendly way [16]. It is increasingly recognized in OECD countries that economic instruments, such as environmental taxes, can successfully stimulate a shift towards less environmentally harmful forms of production and consumption, while allowing producers and consumers the flexibility to adjust production and consumption [17]. Environmental taxes and payments applied in developed foreign countries were introduced with the aim of encouraging entrepreneurs to reduce the generation of waste and reduce the volume of their disposal at landfills and landfills through the introduction of low-waste technologies, as well as organizing the collection and processing of generated waste, which is a secondary raw material. When choosing the type of tax to be established and its amount, legislators proceed from creating the most favorable conditions for the implementation of the “polluter pays” principle, taking into account the current economic situation in the country.

The concept of environmental taxes was developed in the middle of the last century [18, 19]. The classical understanding of the ecological tax is based on the fact that such a tax is designed to reflect in monetary terms the damage caused by the taxpayers to a person or set of persons as a result of environmental pollution and to compensate for such damage. It is important that the environment is the property of society and has the properties of a public good, since any number of people can be its consumer [20]. Accordingly, environmental payments, which compensate the damage caused to a public good, are public in nature. The essence of environmental taxes lies in the economic stimulation of environmental development. But along with the use of "green" taxes as an economic tool to reduce the harmful impact on the environment, they also perform a fiscal function. In practice, however, it turned out that obtaining reliable estimates of environmental damage is sometimes extremely difficult, as well as establishing the specific number of persons exposed to pollution of one or another source. Features of environmental damage, first of all, non-obviousness of causal links between the negative impact on the environment and the harm caused, predetermine the difficulty or impossibility of compensation and the calculation of the harm caused, and by virtue of this - the conventionality of assessing its amount. Often, the damage caused to the environment is difficult to repair or cannot be repaired at all, and the previous state of the environment that existed before the offense is irreparable [21]. In addition, it is not always practical to impose the obligation directly on the persons causing the damage (for example, a state may oblige companies to keep adjacent areas clean, although in fact a person who throws garbage in the street must pay for cleaning). Therefore, over time, there have been some changes in the understanding of the ecological tax.

Currently, the most common is the definition of environmental tax formulated by the Statistical Service of the European Union (Eurostat) for the purposes of international statistical accounting. According to it, an ecological tax is a tax whose tax base is a physical characteristic of an object whose impact on the environment is recognized as negative, or another object associated with it [14]. There is another modern definition of an ecological tax. The European Foundation for the Improvement of Living and Working Conditions [22] defines an environmental tax as an obligation imposed by a state on those who use the environment. This definition captures the basic principle of environmental taxes, which is called the “polluter pays” principle [22].

The use of environmental taxes in economically developed countries is widespread. Thus, as of 2015, transport taxes, taxes on energy, fuel and energy resources have been introduced in 33 European countries, carbon taxes in 12 countries, charges for waste disposal and recycling in 26 countries, taxes on hazardous materials in 15 countries, taxes on hazardous products in 30 countries [23].

A review of environmental taxes in European countries allows one to see that their application has resulted in a reduction of the negative impact on the environment due to the introduction of new technologies by polluting companies. For example, in Great Britain from 1990 to 2008, emissions of pollutants decreased significantly, while GDP growth during this period was 54% [24].

At the moment, concern about climate change in developed countries has reached a very serious level, which led to the organization and development of a number of environmental initiatives and documents. One of the initiatives being developed by Europe is the introduction of a carbon tax on goods imported from countries without carbon regulation (regulation of greenhouse gas emissions). The Paris Agreement of the UN Framework Convention on Climate Change recommends the adoption of a tax on CO₂ emissions (a so-called “carbon tax”), in connection with which all countries that have signed are considering its introduction. The discussed amount of the tax ranges from \$10 to \$60 per ton of CO₂. According to the logic of the carbon tax, these funds should be redirected to the development of renewable energy and energy efficiency. In publications, there are data on the public trading of quotas for the right to emit carbon dioxide in Europe for 15 years, while the quotas, as an asset, can be bought and resold by various interested private entities [10].

Despite the different approaches to the understanding of environmental tax in foreign countries, the following common features can be identified:

• first, environmental taxes and payments are public in nature;
• second, the payers, as a rule, are legal entities and individuals, connected with the sources of environmental pollution;
• third, the environmental tax has a pronounced environmental orientation, which is manifested both in the fiscal nature and in the regulatory nature of environmental taxes. Fiscal nature implies filling budgets to accumulate these payments for further spending on environmental purposes. The regulatory nature of environmental taxes lies in the fact that through budgetary and tax mechanisms there is an impact on the behavior of taxpayers, encouraging them to reduce environmental damage from their activities.

Russia also has taxes and other payments of a similar nature, but a systematic view of the meaning and functioning of these payments has not been developed sufficiently. Such payments include the environmental fee. In the Russian legislation, the environmental fee appeared since 2015-01-01; and its calculation, payment, and reporting were first carried out in 2017 (based on the results of 2016). According to the legislation the environmental fee is not included in the system of taxes and fees of the Russian Federation (Art. 1315, 18 of the Tax Code) and refers to non-tax revenues of the federal budget (Clause 1 of Art. 24.5 of the Federal Law of 1998-06-24 No. 89-FZ “On Production and Consumption Waste”, hereinafter - the Law No 89-FZ). It is noteworthy that in Article 51 of the Budget Code of the Russian Federation “Non-tax revenues of the federal budget”, environmental fee is not directly mentioned, although the recycling fees (Article 24.1 of the Law No. 89-FZ) - are mentioned. Nevertheless, article 24.5 of the Law No 89-FZ (introduced by the Federal Law of 2014-10-29 No. 458-FZ) establishes the basis of the environmental fee from 2015-01-01. Clause 8 of the mentioned article stipulates that the procedure for collecting the environmental fee (including the procedure for calculating it, the term of payment, the procedure for collecting, offsetting and refunding overpaid or overcharged amounts of this fee) is established by the Government of the RF. Accordingly, without the acts of the RF Government regulating these parameters, the collection of the environmental fee would be impossible.

As a result, the elements of the fee are partially disclosed in:

- Decree of the Government of the RF from 2015-10-08 No. 1073 “On environmental fee” (hereinafter - Regulation No. 1073);

- Decree of the Government of the RF of 2016-04-09 No. 284 “Rates of environmental fee for each group of goods subject to disposal after the loss of their consumer properties, paid by manufacturers, importers of goods that do not provide independent disposal of waste from the use of goods”;

- Decree of the Government of the Russian Federation No. 3721r dated 2020-12-31, “On approval of the lists of goods, packaging of goods subject to disposal after loss of their consumer properties”.

An analysis of the norms establishing the payers and elements of the environmental fee allows seeing that:

1. payers and part of the elements (object, tax base, tax rate, tax period) of the environmental fee are established by law, while other elements are established in subordinate acts;
2. the wording of the circle of payers and some elements of the environmental fee is not definite. In particular, the law does not prescribe the rights and obligations of fee payers concerning the procedure for changing the terms of payment of the environmental fee;
3. in comparison with tax payments, enforcement of the obligation to pay the environmental fee is complicated by the fact that a regulatory authority does not have the right to collect the fee out-of-court, and there is no norm on security measures. Responsibility for non-fulfillment of this obligation is introduced by the Federal law of 2019-06-17 No. 141-FZ “On amendments to the Code of the Russian Federation on administrative offences” in the form of sanctions under article 8.41.1 of the Code of the Russian Federation on administrative offences.

The Federal Service for the Supervision of the Use of Natural Resources (Rosprirodnadzor), a body whose main function is not to collect payments (like the Federal Tax Service), but to supervise the use of natural resources, administers the environmental fee. However, one should take into account that the concept of green finance is far from being limited to fiscal policy issues. Under the collective name "green finance" one should understand the component of the capital market, the expansion of a number of financial instruments and opportunities for investors. "Green" finance combines such concepts as "green" investments aimed at the implementation of ecologically clean, energy-efficient and low-carbon projects, "green" bonds, preferential lending, subsidies for "green" projects. In the context of EU policy, green finance is understood as finance to support economic growth while reducing pressure on the environment, and taking into account social and governance aspects. Green finance also includes being transparent about the risks associated with ESG factors that may affect the financial system and mitigating such risks through the proper management of financial and corporate entities [2].

The term "green finance" is often used as a synonym for "green investment". However, in practice, green finance is a broader spectrum of activities that includes more than just investment (Green financing stakeholders’ interaction - See Supplementary Figure 1). Most importantly, it includes operating costs associated with investing in environmental projects that are not included in the definition of green investment presented in current studies, based on the traditional concept of investment. By 2025, the EBRD is committed to allocating more than 50% of its funding to climate and other environmental goals. Another obligation is related to the alignment of all future operations with the goals and principles of the Paris Agreement, which means that any investment will be evaluated according to its content. This approach will affect the reorientation of finances and the way of interacting with customers and operations. This requires the mobilization of the private sector and the conditions for the flow of world capital to developing countries. That is why the EBRD is going to become more involved in the development of climate strategies and policies at the national and sectoral levels [25].

One of the most important legislative initiatives of the EU in the framework of green finance regulation was the adoption of the Sustainable Finance Disclosure Regulation (SFDR) - a European regulation introduced to increase the transparency of the market for sustainable investment products, prevent money laundering and increase the transparency of financial market participants' statements about sustainable development. The new EU regulation on green finance will significantly affect the investment priorities of commercial banks and development banks outside the EU. The SFDR is a set of rules that aim to make sustainability disclosures more understandable to investors [26].

By 2025, the EBRD is committed to allocating more than 50% of its funding to climate and other environmental goals. Another obligation is related to the alignment of all future operations with the goals and principles of the Paris Agreement, which means that any investment will be evaluated according to its content. This approach will affect the reorientation of finances and the way of interacting with customers and operations. This requires the mobilization of the private sector and the conditions for the flow of world capital to developing countries. That is why the EBRD is going to become more involved in the development of climate strategies and policies at the national and sectoral levels [27].

In 2021, the European Commission planned to conduct the first issue of "green" bonds. The intention to issue "green" bonds in the amount of EUR250 billion by the end of 2026 will make the EU the largest issuer of "green" bonds in the world. (EU legal entities involved in the circulation of green bonds - See Supplementary Figure 2) In addition, the European Commission presented the strategy of sustainable financing to combat climate change, the European standard for "green" bonds, and also adopted regulations on the disclosure by financial and non-financial companies of information about the degree of sustainability of their activities [28, 29].

As key requirements of the European standard of green bonds, the European Commission specifies compliance with the taxonomy, transparency, external verification, supervision by the European Securities Markets Agency (ESMA) of verifiers. According to the first criterion the funds collected through the bonds must be fully allocated to projects that comply with the EU taxonomy. Transparency criterion implies full transparency of the distribution of proceeds from bonds, which is ensured by establishing detailed reporting requirements. According to 3^rd requirement all European "green" bonds must be verified by an external reviewer (verifier) to make sure that the financed projects comply with the requirements of the EU Taxonomy Regulation. Supervision requirement stipulates that external verifiers providing services to issuers of European "green" bonds must be registered and supervised by ESMA [30].

In 2020, the EU Technical expert group on sustainable finance (TEG) presented recommendations for the creation of an EU standard for green bonds. This is a voluntary certification scheme that ensures that the use of proceeds is fully compliant with the EU Taxonomy, which sets out the criteria for what is truly sustainable, using six definitions to be applied throughout the block [31]. Currently, the Commission, the Council and the European Parliament have different views on several contentious issues, in particular, on the harmonization of the taxonomy of the use of income, a clause to protect the investor from changes in the legislation of the host country or the introduction of any international sanctions or trade restrictions (grandfathering clause) and transition plans at issuer-level. As a result, the Parliament proposed to expand and strengthen EU requirements for green bond standards, while the Council called for greater flexibility for issuers. Parliament proposes several minimum sustainability disclosure requirements for all bonds marketed as environmentally sustainable, including bonds linked to sustainability. To date, a final decision on the approval of the standard has not been made [32].

Analysis of the impact of green bonds on environmental performance and issuer involvement is still largely unexplored due to limited data. In order to identify any real impacts associated with issuing green bonds, ideally, detailed information on the investment projects, which the proceeds of the bond issue are channeled to, as well as their ultimate impact on the environment, would be required. However, such detailed information is rarely disclosed on a regular basis. In particular, environmental impact reporting is not mandatory in any of the guidelines, although it is considered an encouraged good practice as it enhances market accountability. The World Resources Institute's GHG Protocol recommends tracking three types of corporate carbon emissions: the amount of emissions produced directly by the enterprise; emissions from energy suppliers; all other emissions in the value chain [33].

Of particular note is the importance of the issue of developing a "green" taxonomy. The EU's Green Taxonomy is a science-based system that identifies for investors the types of activities that will enable the decarbonization of the economy. In fact, the taxonomy is a tool to help plan and communicate the transition to an economy in line with the EU's environmental goals (EU Taxonomy Environmental Objectives - see Supplementary Figure 3). Disclosure obligations in the taxonomy encourage reporting on progress towards meeting selection criteria, as well as reporting on reaching them. The taxonomic regulation of the EU describes the basis for the classification of "green" or "sustainable" economic activities carried out in the EU, previously not clearly defined. For investors, the taxonomy brings clarity to questions about which economic activities can be considered environmentally sustainable for investment purposes, which is one of the factors contributing to this investment gap. In addition, it should provide all market participants and consumers with a common understanding of what economic activities can be clearly considered environmentally sustainable [34-36].

All these requirements are designed to ensure the quality of services and the reliability of their reviews to protect investors and ensure market integrity. The two main objectives of the European Green Bond Regulation are the ensuring the application of uniform requirements for the use of the designation “European Green Bonds”, or GBS and the creation of a simple registration system and supervisory framework for external verifiers. The voluntary nature of the European Green Bond Standard was met with controversy during its deliberations, with concerns raised about achieving the first stated goal. On the one hand, issuers are only entitled to use the GBS designation when they fully comply with the requirements of the European Green Bond Standard. At the same time, compliance with these requirements may lead to additional costs and make these financial instruments less attractive to issuers. On the other hand, issuers may label their bonds green if they comply with more lenient guidelines, in particular the ICMA (International Capital Market Association) Principles. This calls into question the effectiveness of the fight against greenwashing - unreasonable positioning of a product or service as environmentally friendly [37].

The taxonomic regulation of the EU establishes a unified classification system for environmentally sustainable economic activities in the EU. The European Commission is entrusted with the task of developing technical selection criteria that will determine whether an economic activity is environmentally sustainable (and to what extent, if so). These criteria are being developed through delegated acts in two tracks: one track will include criteria for climate-related targets, and the other track will include criteria for four other environmental targets [38].

3.2 Institutionalization and administration of green finance in the Russian Federation

Within the Russian national legal regulation of green debt financing, several peculiarities should be highlighted. Firstly, the regulation of green bonds issuance and circulation in Russia is at the initial stage of development. Currently, the regulatory legal array is being formed, primarily aimed at fixing the methods of stimulating the financing of sustainable development (Ecology, Social, Governance).

Experts justifiably note the lack of generally accepted and legislated definitions of “green” investments, criteria for classifying projects as “green”, and an effective system for monitoring the compliance of financial institutions with social and environmental standards in practice.

The Ministry of Economic Development of Russia has developed a draft decree of the Government of the Russian Federation “On approval of the criteria for sustainable development projects in the Russian Federation and methodological guidelines aimed at achieving the goals and main directions of sustainable (green) development in the Russian Federation”, which should approve:

•  criteria for sustainable (green) development projects in the Russian Federation (taxonomy of green and adaptation projects);
•  methodological guidelines for classifying financial instruments aimed at financing sustainable (green) development projects;
•  methodological guidelines for verification of green and adaptation financial instruments;
•  methodological guidelines for maintaining a list of verifiers.

The Working Group on Responsible Finance (ESG-finance), including green finance, under the Expert Council on the Long-Term Investment Market under the Bank of Russia developed:

- a diagnostic note “Green finance: an agenda for Russia” (October 2018);

- The concept of organizing in Russia a methodological system for the development of green financial instruments and responsible investment projects (2019);

- Recommendations on responsible investing (information letter of the Bank of Russia No. IN-06-28/111 dated 2020-07-15).

The report “Impact of Climate Risks and Sustainable Development of the Financial Sector of the Russian Federation” was posted for public consultations (2020), the regulator is working purposefully to update and develop the necessary documents. In particular, the Bank of Russia prepared amendments to the standards of securities issuance. The regulation of green bonds will take into account the first national taxonomy of green projects and national verification of sustainable financial instruments, which will liberalize the terms of green and social bonds. 

Separately, it is worth paying attention to Decree of the Government of the Russian Federation of September 21, 2021 N 1587 "On the approval of the criteria for sustainable (including green) development projects in the Russian Federation and the requirements for the verification system for sustainable (including green) development projects in the Russian Federation Criteria for green projects (taxonomy of green projects) (hereinafter - Decree No. 1587 of 21.09.2021, Decree), which regulates a number of important issues in the field of green finance, in particular, approving the criteria for projects of sustainable (including green) development, as well as criteria for verifiers green projects.

The Decree on Criteria for Green Development Projects takes into account national priorities and leading international practices when developing national taxonomy and standards. The taxonomy of projects consists of: a taxonomy of "green" projects, which includes projects that are recognized as "green" in accordance with international practice, and a taxonomy of adaptation projects, concerning projects aimed at adapting the economy to climate change, but not explicitly recognized as "green" according to international standards. At the same time, "green" projects must simultaneously comply with all the principles for such projects, and the main requirement for adaptation projects is not to contradict the country's environmental priorities and correspond to at least one or several directions of development [39].

In accordance with the Decree, the determination of the achieved environmental effect is entrusted to the project initiator. The initiator monitors the achieved environmental effect from the implementation of sustainable development projects, including at least annually for the preparation of regular reporting on the financial instrument of sustainable development updates information on the achieved (planned) environmental effect from the implementation of sustainable development projects and possible negative factors affecting its achievement [40].

As for the criteria for certification of verifiers, they are also defined by the Decree. To initiate the adoption by the methodological center of a decision on the inclusion of a legal entity in the list of verifiers, the legal entity sends an application to the methodological center with the documents specified in paragraph 33 of the Decree, confirming the compliance of the legal entity with the conditions provided for by this document. Currently, there are 13 legal entities on the list of verifiers [41].

It should be noted that the EU has a similar procedure for selecting a verifier. To become an approved verifier, a company must demonstrate that it has competence and experience in the following three areas: Issuing debt instruments in the capital markets and managing funds in issuing entities; the technical characteristics and performance of low-carbon projects and assets in areas covered by the specific criteria available under the Climate Bond Standard; provision of insurance services in accordance with the International Standards of Assignments, ensuring compliance with the ISAE 3000 standard [42]. The obvious difference is the use of ISAE 3000, a financial assurance standard issued by the International Federation of Accountants.

For today it is obvious that the transition to "green" economic growth, "green" economy is a global trend, while the introduction of the "green" financing mechanism is one of the leading conditions for sustainable economic growth, its goal is to attract financial resources for the "greening" of the economy by creating and development in the financial markets of special institutions and financial instruments for sustainable development, including green bonds. The study gives reason to say that both Russia and the EU are characterized by the lack of unified definitions in the framework of green investment regulation, which creates additional obstacles for potential investors as well as for bond issuers. Of particular importance for the development of the green finance sector is the development of systems and standards for assessing the impact of green finance on the achievement of environmental goals. However, there is currently no legal institutionalization of such standards, which takes the issue beyond the scope of direct legal regulation. Essential for the development of the green finance sector is the development of systems and standards for assessing the impact of green finance on achieving environmental goals, primarily on reducing greenhouse gas emissions. Russian legislative regulation, among other things, faces the issues of the need to unify the conceptual and terminological apparatus related to “green” finance, insufficient experience in linking the goals and objectives of sustainable growth with investment policy priorities, including in the field of infrastructure. This particularly is linked with the need to identify a national authority responsible for green finance, review climate change commitments, environmental and sector-specific targets, assess funding needs by sector, and develop an action plan to develop green finance. Considering the role of external verifiers, it is important to note that their main role is to provide independent opinions by verifying that green bonds conform to a specific framework or green bond standards. At the same time, the current policy of the Russian Federation in the profile direction obviously does not consider this issue as a priority. Besides that, the Russian legislation doesn’t contain generally accepted and legally-fixed definitions of "green" investments, criteria for classifying projects as "green" and an effective system for monitoring compliance by financial organizations with social and environmental standards in practice. In addition, there can be noted the absence of a mechanism for state support of issuers adhering to the principles of sustainable development fixed at the regulatory level. The final solution of the issues of the legal nature and systematization of environmental payments, their administration will also contribute to the solution of the tasks set for the implementation of the environmental agenda of states. In order to ensure sustainable development, the possibilities of international regulatory cooperation and the harmonization of legislation are becoming important.