Sustainable Bottom Line: Occupying a niche corner of the capital markets, a small number of green preferred stocks offer potential attractions but also pose risks.
A small number of green and sustainable preferred stock issues have been listed since 2019
Preferred stock has long been a niche corner of capital markets, sitting between debt and equity. Since at least 2019, the preferred stock market has featured a small number of issuers of green and sustainable preferred shares, securities that combine the income and structural features of preferreds with use-of-proceeds and reporting commitments borrowed from the green bond market. At this point, investors who may be interested in gaining “pure play” exposure to green and sustainable preferred shares may only be able to do so by purchasing these individual securities directly, either in the primary or secondary market. Even at that, the number of US dollar denominated issues are limited and may be difficult to secure without support from a financial adviser. Very limited exposure to preferred stock may be available, more likely via actively managed green bond funds whose mandates permit investments in such securities. Otherwise, there are no dedicated mutual funds or ETFs that invest exclusively in green and sustainable preferred shares.
At least five issuers have raised capital by offering various tranches of green and sustainable preferred stocks, not all denominated in US dollars
Since 2019, at least five issuers (there may be others), two foreign and three U.S. based firms, have raised capital by offering various tranches of green and sustainable preferred stock. These include Brookfield Property Partners and Brookfield Infrastructure Partners, subsidiaries of Brookfield Asset Management Inc., a U.S. based company whose parent company, Brookfield, is a Toronto-based Canadian listed company, Vistra Corp., ACEN Corp., a Philippine based firm, Arthaland Corp., another Phillippine based firm, and Alternative Holdings.
Brookfield’s platforms were early movers: Brookfield Property Partners issued US$250 million of perpetual green preferred units in 2019 to finance sustainable building initiatives across its real-estate portfolio. Brookfield Infrastructure Partners followed with green preferred units aligned to the ICMA Green Bond Principles, providing regular allocation reporting on eligible infrastructure projects. Brookfield Renewable added green perpetual preferred units under its Green Financing Framework to fund renewable generation and decarbonization assets.
In the US, Vistra, an integrated retail electricity and power generation company based in Irving, Texas, issued a sizeable 7% Series B green perpetual preferred stock. Under its Green Finance Framework, Vistra commits to allocate an amount equal to the net proceeds to a portfolio of “Eligible Green Projects” and to publish annual reports describing both allocation and environmental impact until the proceeds are fully deployed. Functionally, this looks very much like a green bond , but from an investor’s perspective, it sits above common equity and below senior debt in the capital structure, with fixed-rate reset coupons and call features typical of preferreds.
Perhaps the most dynamic laboratory for these instruments has been the Philippines. Renewable developer ACEN Corp. has registered up to ₱50 billion of Series A and B green preferred shares, underpinned by a Green Equity Framework and regulatory recognition from the Securities and Exchange Commission that these are indeed “green preferred shares.” Proceeds are earmarked for solar and wind projects, and ACEN reports on allocation in line with its broader green finance program.
Real-estate developer Arthaland Corp. has gone a similar route, issuing preferred shares that fund certified green buildings and earning The Asset’s award for Best Sustainable Preferred Shares in 2025.
Renewable energy firm Alternergy Holdings Corp. has launched a “Green Perpetual Preferred Shares Program” specifically to finance its next wave of renewable projects.
While still small in number (and there may be other outstanding green preferred stocks), taken together, these issuers signal that sustainable preferred equity is a potentially expanding segment of the capital-structure toolkit in emerging markets as well as in global infrastructure platforms.
For sustainable investors, these structures offer several potential attractions, but these instruments also pose preferred-stock risk
• Targeted impact: Because they follow green-bond-style frameworks, investors get transparency on eligible project categories and, in better cases, annual allocation and impact metrics.
• Income with ESG alignment: Preferred coupons are often higher than senior bonds from the same issuer, while proceeds are tied to renewable energy, low-carbon buildings or other environmental assets.
• Structural diversification: Preferreds behave differently from both common equity and straight bonds, adding another risk/return building block to a sustainable allocation.
They also pose familiar preferred-stock risks. Securities are often perpetual, with call options that expose investors to reinvestment risk if rates fall. They are subordinated to senior debt, so credit quality and issuer leverage matter at least as much as if not more than the green label. Liquidity can be thin, especially for privately placed or a local-market series, such as Vistra’s 144A preferreds or Philippine issues listed exclusively on the Philippine Stock Exchange.
Due diligence needs to run along two tracks
Due diligence therefore needs to run on two tracks. On the sustainability side, investors should review the relevant Green Bond/Green Equity Framework, second-party opinions (where available), and the quality of ongoing reporting. On the financial side, they should analyze call terms, reset mechanics, ranking in the capital structure, and the issuer’s broader balance-sheet strategy.
Unfortunately, as noted previously, there are no dedicated mutual funds or ETFs that invest exclusively in green and sustainable preferred shares. While a dedicated exposure may not be available via a mutual fund or ETF, one or more of the issues listed in the table may be owned by green bond funds, conventional preferred funds and conventional bond funds. One such fund example is the $835.9 million Calvert Green Bond Fund that is permitted to invest in preferred stocks and has owned Brookfield’s green preferred units.
The bottom line
The universe of green and sustainable preferred shares is still small, and not yet a core building block for most sustainable portfolios. But for investors comfortable with preferred-stock risk who want to extend impact beyond the bond sleeve, these securities are an emerging way to pair dedicated use-of-proceeds with equity-like income, and a segment worth watching as sustainable finance architectures continue to evolve.
Selected Socially Responsible/Green Preferred Share Issues
The table below summarizes seven representative preferred share issues (or grouped series) that either carry a green or sustainable label or are explicitly structured under an issuer’s green or sustainable finance framework. These examples span North American and Philippine issuers and illustrate how preferred equity has been used to channel capital into renewable energy, green buildings, and other environmentally focused projects.
Issuer | Security / Series | Ticker Symbol(s) | Currency | Key Terms / Description | Use of Proceeds / Green or Social Features |
Brookfield Renewable Partners L.P. | 5.25% Class A Preferred Limited Partnership Units, Series 17 | BEP.PR.A / BEP PR A (NYSE) | US dollars (US$25 liquidation preference) | Perpetual, cumulative preferred partnership units with a fixed 5.25% annual distribution on a US$25 liquidation preference; redeemable at issuer’s option at US$25.00 per unit on or after March 31, 2025, subject to rating‑event and tax‑event call provisions. | Issuer intends to allocate an amount equal to the net proceeds to finance and/or refinance investments in renewable power and transition assets under its green financing framework (hydro, wind, solar, energy‑transition projects). |
Brookfield Infrastructure Partners L.P. | 5.125% Class A Preferred Limited Partnership Units, Series 13 (Green Preferred Units) | BIP PR A (NYSE) | US dollars (US$25 liquidation preference) | Perpetual, cumulative preferred partnership units paying a fixed 5.125% annual distribution on a US$25 liquidation preference; listed on the NYSE, callable at the issuer’s option after an initial non‑call period. | Net proceeds expected to be used to finance and/or refinance Eligible Green Projects in line with Brookfield Infrastructure’s green financing framework, including sustainable infrastructure developments and redevelopments, with temporary use to repay revolving credit facilities pending allocation. |
Brookfield Property Partners L.P. | 6.375% Class A Cumulative Redeemable Perpetual Preferred Units, Series 2 (Perpetual Green Preferred Units) | BPYPO (Nasdaq) | US dollars (US$25 liquidation preference) | Perpetual, cumulative redeemable preferred units with a fixed 6.375% distribution on a US$25 liquidation preference; quarterly distributions; inaugural perpetual green preferred for Brookfield Property. | BPY targets allocation of an amount equal to the net proceeds to finance and/or refinance Eligible Green Projects in its global real‑estate portfolio, such as new and existing LEED/BREEAM/ NABERS‑certified developments, tenant improvements and projects that deliver measurable energy‑efficiency and environmental benefits. |
Vistra Corp. | 7.0% Series B Fixed‑Rate Reset Cumulative Redeemable Green Perpetual Preferred Stock | Private 144A / Reg S (no public ticker) | US dollars (US$1,000 per preferred share) | Perpetual, cumulative preferred stock with an initial fixed 7.0% dividend rate, payable semi‑annually, and a fixed‑rate reset feature after the initial period; issued as institutional preferred equity under Rule 144A / Regulation S. | Issued pursuant to Vistra’s Green Finance Framework. An amount equal to the net proceeds is intended to be allocated to Eligible Green Projects within Vistra’s Vistra Zero portfolio (zero‑carbon generation and battery storage), with public allocation reporting until fully deployed. |
ACEN Corporation | Perpetual Green Preferred Shares, Series A (ACENA) & Series B (ACENB) | ACENA, ACENB (Philippine Stock Exchange) | Philippine pesos (₱1,000 issue price per preferred share) | Peso‑denominated perpetual, cumulative, non‑voting preferred shares in two green series: Series A at 7.1330% (with rate reset after 5 years) and Series B at 8.0000% fixed; both listed on the PSE. | Labelled as green preferred shares under ACEN’s Green Equity Framework. Proceeds are earmarked primarily to finance or refinance new and existing eligible green projects (renewable power assets and related infrastructure) and may refinance short‑term funding linked to those projects. |
Arthaland Corporation | Preferred Shares Series F (ALCPF) – Sustainable / Green Preferred Shares | ALCPF (Philippine Stock Exchange) | Philippine pesos (₱1 par value; ₱500 issue price per share) | Philippine peso‑denominated Series F preferred shares with an initial dividend rate of about 7.326% per annum; roughly ₱2.5 billion raised in a follow‑on offering. Recognized regionally as a Best Sustainable Preferred Share issuance. | Proceeds dedicated to ‘Project Teal’, a sustainably designed two‑tower high‑rise residential development targeted for multiple green‑building certifications and aligned with Arthaland’s green finance strategy (including ASEAN green bonds). |
Alternergy Holdings Corporation | Perpetual Preferred Shares 2, Series A–C (existing) and planned Series D–H (Green Perpetual Preferred Shares Program) | ALTER (common; preferred series approved but not widely traded yet) | Philippine pesos (₱0.10 par value per preferred share) | Non‑voting perpetual preferred shares (Perpetual Preferred Shares 2, Series A–H) with identical features across series. Shareholders approved the reclassification of 500 million common shares into new preferred series to support upcoming capital raising for renewables. | Alternergy describes this as a Green Perpetual Preferred Shares Program. Proceeds from existing and future series are intended to fund the company’s pipeline of renewable projects in wind, solar and run‑of‑river hydro, including its ‘Triple Play’ portfolio and ‘Road to 500 MW by 2026’ strategy. |
Note: Terms summarized here are condensed from issuer prospectuses, offering documents, and official press releases.
