Standard Chartered Bank Sustainability Bond Framework Second-Party Opinion (2019)
Standard Chartered Bank
Use of Proceeds
Sustainalytics is of the opinion that the Standard Chartered Bank Sustainability Bond Framework is credible and impactful, and aligns with the Sustainability Bond Guidelines 2018. 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 (“GBPs”), Social Bond Principles (“SBPs”) and Sustainability Bond Guidelines (“SBG”) 2018. Sustainalytics considers the financing of (i) renewable energy, (ii) clean transportation & affordable basic infrastructure, (iii) employment generation including through the potential effect of SME financing and microfinance, (iv) sustainable water and wastewater management & affordable basic infrastructure, (v) energy efficiency (vi) access to health services and (vii) access to education to have positive environmental or social impacts and to advance the UN Sustainable Development Goals 3, 4, 6, 7, 8, 9 and 11.
Standard Chartered Bank’s internal process to evaluate and select projects is aligned with market standards. Standard Chartered Bank established a three-level process, which includes pre-selection by the Sustainable Finance Working Group, an evaluation by the Sustainable Finance and Environmental and Social Risk Management department, and final approval by its internal Sustainability Bond Committee, which is comprised of one representative from each of the following departments: Group Treasury, Sustainability, Sustainable Finance, Environmental and Social Risk Management and Debt Capital Markets; and is chaired by the Group Sustainability department.
MANAGEMENT OF PROCEEDS
S Standard Chartered Bank’s processes for the management of proceeds are aligned with market practice. Standard Chartered Bank has systems in place to monitor and track the use of proceeds. Unallocated proceeds will be invested in according to the Standard Chartered Bank Group Treasury investment guidelines.
Standard Chartered Bank is committed to report annually on the allocation of proceeds in an allocation report, which will include amounts allocated overall and per eligible category, maturity profile of loans, and the amount of unallocated proceeds. In addition, Standard Chartered Bank intends to report annually on impact indicators, including but not limited to CO2eq saved, number of trains financed, number of SMEs and MFIs financed, number of water treatment facilities financed, and number of schools and hospitals financed. In Sustainalytics’ view reporting on these metrics is in line with market practice.