Navigating critical barriers for green bond markets using A fuzzy multi-criteria decision-making model: Case study in Vietnam

As potent financial instruments channeling capital into climate and environmental projects, green bonds ' issuance is frustrated by myriad obstacles. Therefore, this study aims to explore the critical barriers to green bond issuance in Vietnam. This study elucidates the salient barriers by utilizing an integrated multi-criteria decision-making methodology synthesizing the Fuzzy set theorybased Delphi, Decision-Making Trial and Evaluation Laboratory (DEMATEL), and DEMATELbased Analytic Network Process (DANP). An extensive literature review of green bonds delineates five key dimensions related to impediments: Policy, Market, Financial, Capacity, and Awareness, with 38 discrete indicators representing potential obstacles. Firstly, employing a Fuzzy Delphi survey of 16 experts, 32 indicators are distilled for further analysis. Then, Fuzzy DEMATEL modeling evaluates the interrelationships and interactions among barriers. Finally, DANP is applied to obtain the relative importance of key barriers. Results unveil the five most formidable barriers as a weak regulatory framework and infrastructure (PO1), Limited availability of green bond issuance guidelines and templates (PO2), Insufficient incentives or tax benefits for green bond issuers (PO3), Limited coordination and alignment with international green bond standards (PO5), Lack of investor confidence in the quality and credibility of green projects (AW4), and Capacity constraints among issuers, particularly in smaller organisations or government agencies (CA1). The research contributes to the broader literature on green finance and offers valuable insights for promoting sustainable finance practices in Vietnam and other developing economies.