Project Details
Project
Talanx Green Bond Framework Second-Party Opinion (2021)
Client
Talanx Group
Project Type
Green Bond/Loan; EU Taxonomy Assessment;
Industry Group
-
Use of Proceeds
-
Location
Germany
Evaluation Date
Oct 2021
Evaluation Summary
Sustainalytics is of the opinion that the Talanx Green Bond Framework is credible and impactful and aligns to the four core components of the ICMA Green Bond Principles 2021. This assessment is based on the following:
USE OF PROCEEDS
The eligible categories for the use of proceeds –Renewable Energy and Green Buildings – are aligned with those recognized by the Green Bond Principles 2021. Sustainalytics considers that the eligible categories will lead to positive environmental impacts and advance the UN Sustainable Development Goals, specifically SDG 7 and 9.
PROJECT EVALUATION / SELECTION
Talanx Group has established a Green Bond Committee responsible for evaluating and selecting projects. The Green Bond Committee is chaired by the Chief Finance Officer and is composed of multiple cross divisional departments. Talanx has a dedicated environmental and social risk assessment and mitigation process that is applicable to all allocation decisions made under the Framework. Sustainalytics considers the project selection process in line with market practice.
MANAGEMENT OF PROCEEDS
Talanx Group’s processes for management of proceeds is overseen by the Green Bond Committee and proceeds are tracked through a portfolio approach. Talanx intends to allocate proceeds within 24 months of issuance. Pending full allocation, Sustainalytics positively notes that unallocated proceeds will be invested in green bonds, subject to availability, or cash and cash equivalents. This is in line with market practice.
REPORTING
Talanx Group intends to report annually on the allocation of proceeds on its website until full allocation or in case of significant change. Allocation reporting will include an overview of green bonds issued, the total amount outstanding and the share of financing versus refinancing. Talanx also intends to report annually on the impact of proceeds until full allocation with indicators such as annual renewable energy generation. Sustainalytics views this approach as aligned with market practice.
Alignment with the EU Taxonomy
Sustainalytics has assessed Talanx’s Green Finance Framework for alignment with the EU Taxonomy, and is of the opinion that, of the Framework’s eligibility criteria (which map to six EU activities), four align with the applicable Technical Screening Criteria (“TSC”) in the EU Taxonomy and all four align with the Do No Significant Harm (“DNSH”) criteria. Two activities were not assessed at this time given Talanx does not yet have projects related to their corresponding activities and insufficient evidence to provide an assessment against the EU Taxonomy. No activities were determined to be not aligned. Sustainalytics is also of the opinion that the activities and projects to be financed under the Framework will be carried out in alignment with the EU Taxonomy’s Minimum Safeguards.