Project Details
Project
South Australian Government Financing Authority Sustainability Bond Framework Second Party Opinion (2023)
Client
South Australian Government
Project Type
Sustainability Bond/Loan
Industry Group
Sub-Sovereign
Use of Proceeds
Socio-economic advancement; Climate change adaptation; Natural resources/land use management; Food security; Access to essential services; Water/waste water management; Renewable energy; Employment generation and Socio-economic empowerment; Clean transport; Affordable housing; Affordable basic infrastructure; Pollution prevention and control; Conservation;
Location
Australia
Evaluation Date
Nov 2023
Evaluation Summary
Sustainalytics
is of the opinion that the South Australian
Government Financing Authority Sustainability Bond Framework is credible
and impactful and aligns with the Sustainability Bond Guidelines 2021, Green
Bond Principles 2021and 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 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 1, 2, 3, 4, 5, 6, 7, 8, 9 10, 11, 12, 13, 14 and 15.
PROJECT EVALUATION AND SELECTION
SAFA’s internal process in evaluating and selecting projects will be supported by the ESG Consultation Group, comprising senior officers from SAFA and the Budget and Performance Branch. SAFA will maintain a register of eligible expenditures, which will be reviewed on an annual basis. South Australia has comprehensive laws and control procedures in place to mitigate environmental and social risks associated with the eligible expenditures. Sustainalytics considers the project selection process in line with market practice.
MANAGEMENT OF PROCEEDS
SAFA will manage the proceeds raised under the Framework through a portfolio approach. SAFA intends to reach full allocation within two financial years from the date of issuance. Pending allocation, unallocated proceeds will be held in cash or cash equivalents, used to reduce indebtedness temporarily or made as investments in activities respecting the Framework’s exclusionary criteria. This is in line with market practice.
REPORTING
SAFA intends to report on allocation of proceeds on its website on an annual basis until full allocation. Allocation reporting will include the amount of net proceeds raised; balance of unallocated proceeds; amount of net proceeds allocated per eligible category; share of refinancing and examples of projects funded. In addition, SAFA intends to report on relevant impact metrics. Sustainalytics considers the allocation and impact reporting commitments as aligned with market practice.