Second-Party Opinion Download

Sustainalytics is of the opinion that the Estado de Mexico Sustainability Bond Framework is credible and impactful, and aligns with the Sustainability Bond Guidelines 2021, Green Bond Principles 2021 and Social Bond Principles 2021. This assessment is based on the following: 

USE OF PROCEEDS

The eligible categories for the use of proceeds – Clean Transportation, Support for Vulnerable Groups and People in Vulnerable Situations, and Access to Essential Services – are aligned with those recognized by the Green Bond Principles and Social Bond Principles. Sustainalytics considers that investments in the eligible categories will contribute to positive environmental or social impacts and to advance the UN Sustainable Development Goals, specifically SDGs 3, 5, 10 and 11. 

PROJECT EVALUATION / SELECTION

Estado de Mexico’s Sustainable Committee will oversee the internal process for evaluating and selecting projects, reassessing their eligibility under the Framework yearly. The Committee will also be responsible for identifying and assessing environmental and social risks possibly associated with the projects. Sustainalytics considers the environmental and social risk management procedure to be adequate and the project selection process to be in line with market practice. 

MANAGEMENT OF PROCEEDS

Estado de Mexico’s Sustainable Committee will be responsible for tracking net bond proceeds and allocation. Pending allocation, proceeds will be managed as per the treasury guidelines set forth in Mexico’s Federal Act of Financial Discipline of States and Municipalities, and the Financial Code of the State of Mexico and its Municipalities. Estado de Mexico intends to fully allocate proceeds to eligible projects within 36 months from issuance and has established a look-back period for refinancing of 36 months. This is in line with market practice. 

REPORTING

Estado de Mexico intends to report on the allocation of proceeds on its website on an annual basis until full allocation. The allocation report will include a list of projects financed, the amounts allocated per category, and an estimated share of proceeds used for financing in relation to refinancing. In addition, Estado de Mexico is committed to reporting on relevant impact metrics. Sustainalytics views the allocation and impact reporting as aligned with market practice.