By Paul A. Davies, Edward R. Kempson, Luca Morreale, and Peter Neuböck Sustainable Finance Sustainable finance is the practice of redirecting public and private capital towards investments that support ESG goals and outcomes. The market dynamics of sustainable finance are driven by the need for enormous investments to support sustainable transitions and meet net zero … Continue Reading
Three new publications provide issuers with key guidance on Green, Social, and Sustainability Bonds. By Paul A. Davies, Michael D. Green, and Aaron E. Franklin The Executive Committee for the Green Bond Principles recently published three documents providing key guidance complementing the Green Bond Principles (GBPs), the Social Bond Principles (SBPs), and the Sustainability Bond … Continue Reading
Latest iteration of popular guidelines continue with voluntary, market-driven approach. By Paul A. Davies and Aaron E. Franklin The annual update of the Green Bond Principles (now also including the Social Bond Principles, and the Sustainability Bond Guidelines, collectively, the Principles) on June 14, 2018 created few surprises. The Principles, highly influential in the sustainable … Continue Reading
The action plan recommends leveraging London’s leading role in global green finance to grow green opportunities. By Paul A. Davies The Green Finance Taskforce’s first report, “Accelerating Green Finance,” advises the UK government on how to achieve important green finance goals, carbon targets in relation to the Paris Agreement. The report, published on 28 March, … Continue Reading
The Green Loan Principles may help sustainable investment growth By Paul A. Davies and Aaron E. Franklin The Loan Market Association and the Asia Pacific Loan Market Association recently announced the “Green Loan Principles” joint project. This two-page document, announced on March 21, 2018, seeks to stimulate the de minimis green loan market by following … Continue Reading
Recommendations signal a major shift for Europe’s financial system through both legislative and non-legislative changes. By Paul A. Davies and Aaron E. Franklin The European Commission (EC) has revealed its action plan for mobilizing the financial system to encourage a “greener and cleaner economy.”[1] The plan, which was released on 8 March, states that it … Continue Reading
By Aaron Franklin The United States has the deepest, most liquid capital markets in the world, attracting issuers from across the globe. To sell to US investors, these issuers must comply with US securities laws, entailing a more rigorous diligence and disclosure process. Issuers must weigh the benefits of increased demand against the additional costs, … Continue Reading
New requirements build on China’s rapid progress in green finance to increase transparency across the market By Paul Davies, Bridget Reineking and Andrew Westgate The China Securities Regulatory Commission (CSRC), in collaboration with China’s Ministry of Environmental Protection, has introduced new requirements that, by 2020, will mandate all listed companies and bond issuers to disclose environmental, … Continue Reading
By Paul Davies, Bridget Reineking, and Andrew Westgate Since establishing the People’s Bank of China’s Green Finance Task Force in 2014, China has encouraged green financing mechanisms through a variety of pioneering initiatives. For example, the country has designated five green finance pilot zones, within which financial institutions are incentivised to provide credit and special … Continue Reading
By Paul Davies, Aaron Franklin, and Andrew Westgate The China Securities Regulatory Commission (CSRC) released new guidelines (the Guidelines) on the issuance of green bonds on March 2, 2017, marking an important step in the development of what is now the world’s largest green bond market, accounting for 39% of global issuances by principal amount issued … Continue Reading
By Paul Davies and Michael Green The Vice-President of the European Investment Bank, Jonathan Taylor called for “a renewed effort from the world’s financial institutions to make the Paris Agreement a reality” at the COP 22 Conference, held last month in Marrakesh. Green finance will have an instrumental role to play in the transition of … Continue Reading
By Paul Davies and Andrew Westgate Now in its eleventh year, The G20 Summit heads to the city of Hangzhou, China – the first time a G20 summit has been held for heads of state in China. As this years’ destination, China is maximising its role as the host nation to not only highlight its … Continue Reading
By Paul Davies and Aaron Franklin China has become the world’s largest green bond market, with green bonds issued in the first half of 2016 reaching 75 billion yuan (US$11 billion), 33% of the world total. This figure is approximately two percent of the total assets of China’s commercial banks, and demand for green bonds … Continue Reading
By Aaron Franklin Green Bonds have led a tremendous growth in environmental finance over the past five years, but that growth has been heavily-weighted towards investment grade credits with their accompanying risk/return. The predominance of investment-grade credits partially results from the all-or-nothing approach of Green Bonds – the bond is either 100% green or 0% … Continue Reading
By Paul Davies and Andrew Westgate Green bonds, which tie the proceeds of the issuance to investments that have positive environmental and/or climate benefits, are a rapidly growing asset class. Recent figures have corroborated the narrative of growth predicted by industry experts. In the first quarter of 2016, green bonds totalling US$17 billion were issued … Continue Reading
By Paul Davies and Andrew Westgate China has launched a green bond pilot initiative via the Shanghai Stock Exchange, encouraging further foreign investment in a rapidly growing asset class and paving the way for issuances by non-financial institutions. This initiative closely follows the publication of green bond guidelines in December 2015 by the National Association … Continue Reading
By Cesare Milani and Alice Gunn With US$100 billion of issuances anticipated by year end, the green bonds market is increasingly attracting the attention of corporations, supranational entities, multilateral banks, cities and municipalities seeking to raise capital for projects or investments with a positive environmental impact. There was a threefold increase in green bond issuances in … Continue Reading
