Second-Party Opinion Download

Sustainalytics is of the opinion that the Sovereign Sustainable Finance Framework is credible and impactful and aligns with the Sustainability Bond Guidelines 2021, Green Bond Principles 2021, Social Bond Principles 2021, Green Loan Principles 2021, and Social Loan Principles 2021. This assessment is based on the following:  

USE OF PROCEEDS

The eligible categories for the use of proceeds, Green Buildings, Energy Efficiency, Renewable Energy, Clean Transportation, Terrestrial and Aquatic Biodiversity, Affordable Housing, and Access to Essential Services, are aligned with those recognized by the Green Bond Principles, Social Bond Principles, Green Loan Principles and Social Loan Principles. Sustainalytics considers that investments in the eligible categories are expected to lead to positive environmental or social impacts and advance the UN Sustainable Development Goals, specifically SDGs 7, 8, 9, 10, 11 and 15. 

PROJECT EVALUATION / SELECTION

Sovereign’s internal process for evaluating and selecting projects is overseen by its Group Investment and Major Project committees, which comprise executive team and board members. These committees also oversee Sovereign’s environmental and social risk management processes for all development-related project allocations under the Framework, while others are reviewed by the ESG Team. Sovereign’s ESG Team oversees the implementation and management of the Framework. Sustainalytics considers the project selection process in line with market expectation.

MANAGEMENT OF PROCEEDS

Sovereign’s Sustainable Finance Asset Register will be used to track all projects, investments and expenditures into eligible projects, as approved by the committees and the ESG Team, and allocated within 24 months of issuance. Unallocated gross proceeds will be managed in accordance with Sovereign’s treasury management policy. This is aligned with market expectation. 

REPORTING

Sovereign intends to report annually on the allocation of proceeds under the Framework until full allocation. The report will detail total proceeds allocated to each eligible project category, a breakdown of proceeds allocated to new and existing projects, the share of financing versus refinancing, and the balance of unallocated proceeds. In addition, the Issuer intends to report on relevant impact metrics. Both the allocation and impact reports are expected to be published annually within Sovereign’s ESG Report to its website. Sustainalytics views Sovereign’s allocation and impact reporting as aligned with market expectation.