Image: eucalyptus plantation, São Paulo. C. Gustavo Frazao/Shutterstock


Berlin, 10 June 2021 – If not issued with great caution, green bonds used in the pulp sector and for industrial tree plantations are likely to carry negative social and environmental impacts, according to a new analysis by the Environmental Paper Network (EPN).(1) This could result in a reputational risk for the green bonds sector as a whole – as investors may lose trust in its credibility. Green bonds, which have been growing in popularity, are a type of fixed-income financial instrument specifically meant to raise money for climate and environmental projects.

The EPN compiled a case study of recently issued green bonds by the Finnish pulp and paper company UPM-Kymmene Corporation (UPM), which are mostly used for operations in Uruguay and Finland. Citigroup, BNP Paribas, Danske Bank, Nordea and JP Morgan are mentioned by UPM as joint bookrunners, which in finance indicates the leading contact in charge of the investment books.(2) The EPN could not find enough evidence that the green bonds will contribute significantly to sustainability goals. On the contrary, significant funds seem to be allocated to ‘business as usual’ activities, which are already having adverse social and environmental impacts.

Karen Vermeer, coordinator of the EPN finance working group, said: “These bonds are not always ‘green’ and companies should not mislead investors. Before allowing a company to issue a green bond, investors should look at the company’s overall performance, including its social and environmental impacts. Otherwise, a company can issue a green bond and at the same time still cause severe impacts, using the green bond just to greenwash its public image.”

Ana Filipinni from the Movimiento por un Uruguay Sustentable said: It is outrageous that UPM is collecting money for green bonds, but at the same time creating tension and social conflicts, ignoring the rights of stake- and rights holders, and converting natural grasslands into large scale tree monoculture plantations in Uruguay. We assume this is not what investors had in mind, when putting money to these green bonds.”

Juha Aromaa, Deputy Programme Manager at Greenpeace Nordic- Finland, said: UPM’s green bond will be used for ‘sustainable forest management’ in Finland, but current forest management largely based on clear cutting is the single biggest threat factor for hundreds of endangered species in our country. UPM has repeatedly cut down habitat of endangered species and keeps purchasing wood from operations that destroy high conservation values.” 

EPN published an investor briefing on industrial tree plantations and green bonds in 2019. The report “Industrial Tree Plantations And Green Bonds – episode 2: UPM-Kymmene Corporation” is a sequel, and the EPN intends to publish more case studies in the future as the green bonds market keeps expanding



  1. Industrial Tree Plantations And Green Bonds – episode 2: UPM-Kymmene Corporation, EPN, June 2021.


Karen Vermeer, coordinator Finance Working Group, the Environmental Paper Network [email protected], +31 6 39424524 (CEST)

Juha Aromaa, Deputy Programme Manager, Greenpeace Nordic, +358 50 369 6202, [email protected] (EEST)

Ana Filippini, MOVUS (Movimiento por un Uruguay Sustentable), +598(0)98407572, [email protected], (GMT-3)