This article originally published on Intrafish.com on July 3, 2020.

Green bonds issues have soared in recent years and this growth is projected to continue worldwide in 2020, despite the impacts of coronavirus.

The market started taking off with NOK 356 billion issued globally in 2014, rocketing to a total NOK 1.6 trillion issued in 2018.

In January, the world's biggest salmon farmer, Mowi, became the first seafood company in the world to issue a green bond, with a five-year loan package worth about NOK 2 billion. And last month, fellow salmon producer Grieg followed suit by completing a green bond loan package worth NOK 1 billion. Both companies pledge to invest heavily in alternative, more sustainable feed and increase the number of Aquaculture Stewardship Council (ASC)-certified sites under their management.

A green bond works similarly to a traditional bond, but its proceeds are intended to give projects related to environmental sustainability the access to capital needed to scale.

For investors, there are large incentives in green bonds such as tax exemption and tax credits, as well as positive marketing, publicity, and branding value — at no extra cost to them. Green bond issuers continually cite heavy demand and oversubscription.

Issuers must report on how they use their proceeds and the impact they achieve, but there are not yet any specific or standard reporting requirements. This means that, for now, while they often verify with a third party, green bond issuers largely decide on their own metrics, targets, and impact.

As the first aquaculture companies to issue green bonds, Mowi and Grieg are setting the precedent for the industry’s way forward — and they’re choosing to focus on fish health.

To meet environmentally sustainable aquaculture goals, both are focusing on sustainable feed ingredients as well as reducing fish escapes, benthic impact, sea lice treatments, and antibiotic use. They also aim to increase the number of ASC-certified sites under their management—which would boost all of the above.

Mowi and Grieg’s successful green bonds show that salmon has a place in this market. They’re also showing that there is great potential to drive capital into the industry: amongst the salmon producers in Norway that do have ASC certifications, Mowi and Grieg land in the middle of the road.

Other producers could easily make the case to improve their production through a green bond simply with these ASC metrics, as Mowi and Grieg have. But for those already fully certified, like Hofseth Aqua, how can further improvements be quantified?

At Manolin, we continually hear from fish health biologists and production managers that there’s no industry more willing to tackle their own challenges than Norwegian salmon. And we’ve seen this firsthand in our travels up and down the coast. There’s a strong sense of pride in this industry, which has enabled enormous improvements in just a few decades: the use of antibiotics in Norwegian salmon aquaculture has dropped by more than 99 percent since the 1990s, and today, regional cooperation is tackling the issue of sea lice in the same way.

Now is the time to invest in healthier fish, farms, and seas — because the data is showing that it not only proves a positive environmental impact, it benefits the bottom line and the industry across the board. Green bonds could be a way forward for Norwegian salmon to both leverage more capital and meet these goals, all while strengthening the industry’s reputation globally to better showcase the work our farmers are putting in every day.