For the first time, green finance is included on the Group of 20 summit agenda thanks to the efforts, mainly from China, to make the financial sector contribute more to environmentally friendly economic growth around the globe.
After China took over the G20 presidency last year, it quickly moved to make green finance one of the major topics at the summit, which is scheduled for Sept. 4-5 in the eastern city of Hangzhou.
China proposed the setup of a G20 Green Finance Study Group led by the central banks of China and Britain, which has developed a synthesis report on green finance for deliberation at the Hangzhou summit.
The report clarifies the definition and scope of green finance, identifies challenges faced by green finance and provides voluntary options for countries to support the transition into a green and low-carbon growth model, said Yi Gang, deputy governor of the People's Bank of China (PBOC).
Green finance aims to make financing activities more environmentally friendly, reduce pollution and greenhouse gas emissions and raise the efficiency of energy use, Yi said.
On Wednesday, the PBOC and several Chinese ministries unveiled a guideline for establishing a green finance mechanism to facilitate the economy's transition to sustainable growth, making China the first country with a relatively complete green finance system in the world.
The guideline aims to encourage more private capital into green sectors and stem investment that might pollute the environment, as green growth is now part of China's development strategy for the 2016-2020 period.
Supportive policies to promote green finance include offering government interest subsidies via refinancing and professional guarantees and the setting up of a national green development fund, which will reduce investors' financing cost or improve their profit.
China is doing much more than just discussing green finance, Yi said, noting that the country is far ahead of many other countries in this respect.
In the first seven months of 2016, China's green bond issuance hit 120 billion yuan (about 18 billion U.S. dollars), accounting for about 40 percent of the world's total during the same period, data showed.
"China is entering a golden era for the development of green finance," said Zeng Gang, a researcher with the Chinese Academy of Social Sciences.
While building and improving its own green finance mechanism, the country also plays an important role in making green finance rules at the international level, donating "Chinese wisdom" to low-carbon global growth, Zeng said.
"As the world is currently facing stark environmental challenges, developing green finance will not only improve global environment but also mobilize more investment into the green sectors, which will be conducive to raising the growth potential of the world economy," Yi said.
As one of the three economies to have a green credit index system, China will continue to enhance international cooperation in this field and steadily promote the two-way opening up of green bond markets, according to the guideline.
China will continue to promote green finance development under the G20 framework and share valuable experience with the rest of the world, analysts say.