Project Details
Project
Nidec Corporation Green Bond Second-Party Opinion
Client
Nidec Corporation
Project Type
Green Bond/Loan
Industry Group
Electrical Equipment
Use of Proceeds
Clean transport
Location
Japan
Evaluation Date
Nov 2019
Evaluation Summary
Sustainalytics is of the opinion that the Nidec Corporation Green Bond Framework is credible and impactful and aligns with the four core components of the Green Bond Principles 2018 (GBP). This assessment is based on the following:
USE OF PROCEEDS
The eligible category for the use of proceeds, clean transportation, is aligned with those recognized by the GBP. Sustainalytics considers that investments for the manufacture of traction motors for electric vehicles (EVs) financed by the green bonds will lead to positive environmental impacts and advance the UN Sustainable Development Goal 11.
PROJECT EVALUATION/SELECTION
Nidec’s process for project evaluation and selection will be executed by Nidec’s Finance Department upon discussion with IR-CSR Promotion Department and relevant Business Units, based on the eligible criteria. Final approval will be made by the Vice President in charge of the Finance Department. Sustainalytics considers this process to be in line with market practice.
MANAGEMENT OF PROCEEDS
Nidec’s process for the management of proceeds is in line with market practice. The proceeds will be tracked and monitored by the Finance Department biannually, using electronic files and through its designated process. Pending allocation, an equal amount of unallocated proceeds will be held in cash or cash equivalents.
REPORTING
Allocation and impact reporting will be provided annually. Allocation reporting will include the amounts allocated to eligible projects and the balance of unallocated proceeds, and updated until full allocation, while impact reporting will be updated throughout the term of the Green Bond, which will include relevant quantitative metrics such as the number of traction motors shipped per year and CO2 emissions avoided. Moreover, Nidec commits to receive a compliance review by Sustainalytics as an independent external provider annually, until full allocation. Sustainalytics views Nidec’s reporting commitments along with compliance review to be aligned with market best practice.