Project Details
Project
BMO Sustainable Financing Framework Second-Party Opinion
Client
Bank of Montreal, BMO
Project Type
Sustainability Bond/Loan
Industry Group
-
Use of Proceeds
-
Location
Canada
Evaluation Date
Sep 2019
Evaluation Summary
Sustainalytics is of the opinion that the Bank of Montreal (BMO) Sustainable Financing Framework is credible and impactful, and aligns with the Sustainability Bond Guidelines 2018. This assessment is based on the following:
USE OF PROCEEDS
The eligible categories for the use of proceeds – (i) Renewable Energy, (ii) Green Buildings & Infrastructure, (iii) Energy Efficiency, (iv) Clean Transportation, (v) Pollution Prevention and Control, (vi) Sustainable Water and Wastewater Management, (vii) Sustainable Management of Living Natural Resources & Sustainable Land Use, (viii) Indigenous Peoples’ Business and Community Lending, (ix) Women-Owned Business Lending, (x) Access to Essential Services, and (xi) Affordable Housing -- align with those recognized by the Green Bond Principles 2018 and Social Bond Principles 2018. Sustainalytics considers the range of eligible projects to have positive environmental and social impacts and to advance a number of key UN Sustainable Development Goals.
PROJECT EVALUATION/SELECTION
BMO has a dedicated Sustainable Bond Working Group (the “SBWG”) responsible for reviewing eligible projects, ongoing monitoring and validation procedures. The SBWG will comprise of cross-functional team, including representatives from BMO’s Sustainability Office. BMO also has an internal environmental and social risk assessment process in place. This is in line with market practice.
MANAGEMENT OF PROCEEDS
BMO’s Sustainability Office will track the use of net proceeds to eligible projects through its internal information systems. Pending allocation, the net proceeds will be held in cash or liquid securities in accordance with BMO’s normal liquidity management policy. This is in line with market practice.
REPORTING
BMO intends to publish annual information on its website within one year of issuance, until full allocation. Allocation reporting will include the total outstanding amount, allocated amount by eligible category, balance of unallocated proceeds, as well as relevant impact metrics, where feasible. BMO may also engage an independent auditor for post issuance verification of allocated proceeds. Sustainalytics views BMO’s allocation and impact reporting as aligned with market practice.