Sustainability-linked bond: Difference between revisions
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imported>Doug Williamson (Layout.) |
(Update to 2024 SLBPs.) |
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(SLB). | (SLB). | ||
ICMA defines and explains sustainability-linked bonds as: | ICMA defines and explains sustainability-linked bonds as: | ||
:".. any type of bond instrument for which the financial and/or structural characteristics can vary depending on whether the issuer achieves predefined Sustainability/ ESG objectives. | :".. any type of bond instrument for which the financial and/or structural characteristics can vary depending on whether the issuer achieves predefined Sustainability / ESG objectives. | ||
: | :In that sense, issuers are thereby committing explicitly (including in the bond documentation) to future improvements in sustainability outcome(s) within a predefined timeline. | ||
: | :SLBs are a forward-looking performance based instrument. | ||
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:"The proceeds of SLBs are intended to be used for general purposes, hence the use of proceeds is not a determinant in its categorisation. Regardless, in select cases, issuers may choose to combine the GBP/SBP approach with the SLBP. | :"The proceeds of SLBs are intended to be used for general purposes, hence the use of proceeds is not a determinant in its categorisation. Regardless, in select cases, issuers may choose to combine the GBP/SBP approach with the SLBP. | ||
: | :Thus, please note that SLB are not to be confused with Sustainability Bonds (i.e. Use-of-Proceeds bonds)." | ||
:''International Capital Market Association - Sustainability-Linked Bond Principles'' | :''International Capital Market Association - Sustainability-Linked Bond Principles (SLBP)'' | ||
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* [[Corporate social responsibility]] | * [[Corporate social responsibility]] | ||
* [[Green Bond Principles]] (GBP) | * [[Green Bond Principles]] (GBP) | ||
* [[ | *[[Environmental, social and governance]] (ESG) | ||
* [[Green bond]] | * [[Green bond]] | ||
* [[International Capital Market Association]] | * [[International Capital Market Association]] | ||
* [[Key performance indicator]] | * [[Key performance indicator]] | ||
* [[Loan Market Association]] | * [[Loan Market Association]] | ||
* [[Retail bond]] | |||
* [[Social bond]] | * [[Social bond]] | ||
* [[Social impact bond]] | * [[Social impact bond]] | ||
* [[Sustainability]] | * [[Sustainability]] | ||
* [[Sustainability bond]] | * [[Sustainability bond]] | ||
* [[Sustainability Bond Guidelines]] | * [[Sustainability Bond Guidelines]] (SBP) | ||
* [[Sustainability Linked Loan Principles]] | * [[Sustainability-Linked Bond Principles]] (SLBP) | ||
* [[Sustainability-linked derivatives]] (SLDs) | |||
* [[Sustainability-Linked Loan Principles]] (SLLP) | |||
* [[Sustainability performance target]] | * [[Sustainability performance target]] | ||
* [[Use of proceeds bond]] | * [[Use of proceeds bond]] | ||
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==Other resource== | |||
[https://www.icmagroup.org/assets/documents/ | * [https://www.icmagroup.org/assets/documents/Sustainable-finance/2024-updates/Sustainability-Linked-Bond-Principles-June-2024.pdf Sustainability Linked Bond Principles, ICMA - 2024] | ||
[[Category:Accounting,_tax_and_regulation]] | [[Category:Accounting,_tax_and_regulation]] | ||
[[Category: | [[Category:Compliance_and_audit]] | ||
[[Category: | [[Category:Financial_products_and_markets]] | ||
[[Category:Identify_and_assess_risks]] | |||
[[Category:Investment]] | [[Category:Investment]] | ||
[[Category:Long_term_funding]] | [[Category:Long_term_funding]] | ||
[[Category:Manage_risks]] | |||
[[Category:Risk_reporting]] | |||
[[Category:Risk_frameworks]] | |||
[[Category:The_business_context]] | |||
[[Category:Accounting,_tax_and_regulation]] | |||
[[Category:Compliance_and_audit]] | [[Category:Compliance_and_audit]] | ||
[[Category: | [[Category:Financial_products_and_markets]] | ||
[[Category:Identify_and_assess_risks]] | [[Category:Identify_and_assess_risks]] | ||
[[Category:Investment]] | |||
[[Category:Long_term_funding]] | |||
[[Category:Manage_risks]] | [[Category:Manage_risks]] | ||
[[Category:Risk_reporting]] | |||
[[Category:Risk_frameworks]] | [[Category:Risk_frameworks]] | ||
[[Category: | [[Category:The_business_context]] | ||
Latest revision as of 16:12, 3 August 2024
Sustainability - sustainable bonds - International Capital Market Association (ICMA).
(SLB).
ICMA defines and explains sustainability-linked bonds as:
- ".. any type of bond instrument for which the financial and/or structural characteristics can vary depending on whether the issuer achieves predefined Sustainability / ESG objectives.
- In that sense, issuers are thereby committing explicitly (including in the bond documentation) to future improvements in sustainability outcome(s) within a predefined timeline.
- SLBs are a forward-looking performance based instrument.
- "Those objectives are (i) measured through predefined Key Performance Indicators (KPIs) and (ii) assessed against predefined Sustainability Performance Targets (SPTs).
- "The proceeds of SLBs are intended to be used for general purposes, hence the use of proceeds is not a determinant in its categorisation. Regardless, in select cases, issuers may choose to combine the GBP/SBP approach with the SLBP.
- Thus, please note that SLB are not to be confused with Sustainability Bonds (i.e. Use-of-Proceeds bonds)."
- International Capital Market Association - Sustainability-Linked Bond Principles (SLBP)
See also
- Corporate social responsibility
- Green Bond Principles (GBP)
- Environmental, social and governance (ESG)
- Green bond
- International Capital Market Association
- Key performance indicator
- Loan Market Association
- Retail bond
- Social bond
- Social impact bond
- Sustainability
- Sustainability bond
- Sustainability Bond Guidelines (SBP)
- Sustainability-Linked Bond Principles (SLBP)
- Sustainability-linked derivatives (SLDs)
- Sustainability-Linked Loan Principles (SLLP)
- Sustainability performance target
- Use of proceeds bond
