Risks and Prevention Methods in Green Finance

FOF Sciences, City University of Macau, 999078 Macau, China

^* Corresponding author: F22090101211@cityu.edu.mo

Abstract

With the increasingly severe global environmental issues, green finance, as an important tool for promoting sustainable development and environmental protection, has experienced rapid growth in recent years. However, while green finance brings significant opportunities, it is also accompanied by various risks, including market risk, technological risk, policy risk, and credit risk. This article systematically reviews the definition, framework, and risk types of green finance, and through case studies of CATL and BlackRock, demonstrates the specific practices of different enterprises *in green finance risk management. CATL effectively addresses market and technological risks through data-driven risk assessment and forward-looking policy analysis, while BlackRock integrates ESG factors into its investment decision-making process, promotes the development of the green bond market, and enhances the transparency and credibility of green finance. The article also proposes recommendations for addressing green finance risks from both governmental and corporate perspectives, emphasizing the importance of policy refinement, international cooperation, and corporate risk management. Although green finance currently faces numerous challenges, with strengthened policy support, accelerated technological advancements, and deepened international cooperation, green finance is expected to achieve higher-quality development on a global scale. Future research should further explore the long-term impacts of green finance risks, develop more precise risk assessment models, and improve the market liquidity of green finance products, thereby enhancing the green finance market.