Green stock exchanges are specialized platforms or initiatives within traditional stock exchanges that promote sustainable investing by listing and trading securities aligned with environmental, social, and governance (ESG) principles. These exchanges focus on companies and projects that prioritize sustainability, such as renewable energy, clean technology, and climate-friendly initiatives.

How Green Stock Exchanges Promote Sustainable Investing:
1. Listing Requirements: They set strict ESG criteria for companies to list their shares, ensuring that only environmentally responsible businesses are included.
2. Transparency: Green exchanges require companies to disclose their environmental impact and sustainability practices, fostering accountability and informed decision-making.
3. Investor Access: They provide a dedicated platform for investors seeking to allocate capital to sustainable projects, making it easier to identify and support green initiatives.
4. Market Incentives: By creating a marketplace for green securities, these exchanges encourage companies to adopt sustainable practices to attract investment.
5. Awareness and Education: Green exchanges often raise awareness about the importance of sustainable investing, influencing broader market behavior.

Examples include the Luxembourg Green Exchange (LGX) and the Sustainable Stock Exchanges (SSE) initiative, which collaborate with global exchanges to promote ESG-focused investments. By aligning financial markets with environmental goals, green stock exchanges play a pivotal role in driving the transition to a low-carbon economy and fostering long-term sustainability.