Project Details
Project
Ontario Sustainable Bond Framework Second-Party Opinion (2024)
Client
Province of Ontario
Project Type
Sustainability Bond/Loan
Industry Group
Sub-Sovereign
Use of Proceeds
Clean transport; Green buildings; Energy efficiency; Renewable energy; Natural resources/land use management; Climate change adaptation; Water/waste water management; Pollution prevention and control; Sustainable aquaculture/fisheries; Affordable basic infrastructure; Health; Education; Affordable housing; Employment generation and Socio-economic empowerment;
Location
Canada
Evaluation Date
Jan 2024
Evaluation Summary
Sustainalytics is of the opinion that the Ontario Sustainable Bond Framework is credible and impactful and aligns with the Sustainability Bond Guidelines 2021, Green Bond Principles 2021 and Social Bond Principles 2023. This assessment is based on the following:
USE OF PROCEEDS
The eligible categories for the use of proceeds are aligned with those recognized by both the Green Bond Principles and Social Bond Principles. Sustainalytics considers that investments in the eligible categories will lead to positive environmental or social impacts and advance the UN Sustainable Development Goals, specifically SDGs 3, 4, 6, 7, 8, 9, 11,12,13, 14 and 15.
PROJECT EVALUATION AND SELECTION
The Ontario Financing Authority (OFA) in collaboration with the Province’s Sustainable Bond Advisory Panel (SBAP) will oversee project evaluation and selection. The SBAP identifies and evaluates environmental and social risks for all allocation decisions made under the Framework. Sustainalytics considers these risk management systems to be adequate and the project selection process to be aligned with market practice.
MANAGEMENT OF PROCEEDS
The OFA will be responsible for the allocation of proceeds to eligible assets and will track the proceeds through an internal tracking system. The Province intends to allocate proceeds within 12 months of issuance. Pending full allocation, proceeds will be temporarily invested in short-term Government of Canada treasury bills. This is aligned with market practice.
REPORTING
The Province commits to report on the allocation of proceeds on an annual basis until full allocation publicly on its website. Allocation reporting will include breakdown of proceeds according to project category and, the balance of unallocated proceeds. In addition, the Province is committed to reporting on relevant impact metrics. Sustainalytics considers the allocation and impact reporting commitments as aligned with market practice.