Second-Party Opinion Download

Sustainalytics is of the opinion that Green Finance Framework of Guangzhou Metro Group Co., Ltd. (GZ Metro) is credible and impactful and aligns with the four core components of the Green Bond Principles 2021 and the Green Loan Principles 2021. This assessment is based on the following:

  USE OF PROCEEDS

The eligible categories for the use of proceeds – Low Carbon Transportation, Pollution Prevention and Control, Energy Efficiency and Renewable Energy – are aligned with those recognized by the Green Bond Principles and the Green Loan Principles. Sustainalytics considers that investments in the eligible categories will lead to positive environmental impacts and advance the UN Sustainable Development Goals, specifically SDGs 7 and 11.

  PROJECT EVALUATION / SELECTION

GZ Metro’s internal process for evaluating and selecting projects is managed by a Green Finance Working Group (GFWG), comprised of representatives from various departments, including Financial Management, Strategic Development, Construction Business, Chief Engineer Office and Legal Contract. The GFWG will meet biannually to select eligible projects in line with the Framework’s eligibility criteria, facilitate reporting and manage future updates. Sustainalytics considers the project selection process in line with market practice. GZ Metro’s internal environmental and social risk management systems apply to all allocation decisions made under the Framework. Sustainalytics considers these risk management systems to be adequate. This is in line with market practice.

  MANAGEMENT OF PROCEEDS

The process of management of proceeds is also overseen by the GFWG. The net proceeds will be deposited in the GZ Metro’s general funding account and earmarked for allocation. GZ Metro will maintain a green finance register to record and track allocation. GZ Metro intends to complete full allocation of the proceeds within two years. Pending allocation, unallocated proceeds will be held in accordance with GZ Metro’s normal liquidity management policy, in cash equivalents. 

  REPORTING

GZ Metro intends to report on allocation and impact of proceeds in a green finance report on its website on an annual basis until full allocation. Allocation reporting will include a list of eligible projects, the amount allocated to each project, project details, examples of project financing, share of financing versus refinancing, and balance of unallocated amounts. GZ Metro is also committed to reporting on relevant impact metrics. Sustainalytics views GZ Metro’s allocation and impact reporting as aligned with market practice.