Skip to main content

What’s Happening in Sustainable Finance: Market Expectations Rise, Green Bonds Continue to Flourish, and Biodiversity Climbs Up the Agenda

Posted on November 12, 2021

 

 

 

 

Listen on your favorite player:

 

Episode Summary

Hosts

  • Nicholas Gandolfo, Director, Corporate Solutions
  • Aditi Bhatia, Regional Sales Manager, Corporate Solutions

In this episode, Nick and Aditi discuss hot topics in sustainable finance. As the global green, social, sustainable, and sustainability-linked market continues to thrive, our hosts take note of the growing variety in use of proceeds, the debate around sustainability-linked bond penalties, and an eyebrow-raising new SLB issuance from Philip Morris International.  

Sustainable Bond Market Reaches Half a Trillion in 2021

The Climate Bonds Initiative (CBI) reported that total labelled bond issuances (green, social, sustainability, transition and sustainability-linked) hit the half trillion mark in the first half of the year. That’s a 59% increase compared by 2020. For the green bond market specifically, CBI predicts annual volumes will reach $1 trillion by 2023. Other trends noted in the report are the continued growth of social and sustainability bonds, with social bond volumes quadrupling in H1 and sustainability bonds increasing 20%. The volume of sustainability-linked bonds also continued to soar in 2021. Transition bond issuances, on the other hand, are still struggling to gain traction. 

Biodiversity on the Agenda

Nick notes that biodiversity continues to draw the attention of investors and issuers globally, with a growing number of reports and articles on the topic. This year also saw the UN Convention on Biological Diversity, or COP 15, wrapping up in China, and the launch of the Task Force on Nature-related Financial Disclosures over the summer. In the world of sustainable finance, we think biodiversity-related targets and use of proceeds will likely become more prominent within linked instruments and labeled bond issuances.

Webinar | ESG Risk Rating in APAC: Supporting the Corporate Sustainability Journey 

Join us on Tuesday, November 16, to hear from corporate and sustainable finance leaders in the APAC region. Our panelists will share their thoughts on corporate environmental, social and governance (ESG) ratings, and provide insight on how they integrate ESG ratings into their investment and sustainable finance activities.  

To register for the live event or to watch the replay, click here.

 

Key Moments

00:02:50 Market overview
00:02:52 CBI report on H1 2021
00:04:36 Tier 2 subordinated debt
00:05:28 Greenwashing debate
00:06:33 SLBs and questions about penalties
00:07:05 Biodiversity
00:08:02 Nuclear
00:09:18 Philip Morris SLB
00:10:06 CBI report on Latin America
00:10:44 CBI annual conference
00:11:53 Green bonds overview
00:21:35 Social loans overview
00:22:58 Green loans overview
00:24:23 SLB overview
00:27:57 Audience questions
00:30:09 SLL overview
00:31:47 Transition bonds overview

 

Links to Select Resources

 

Recent Content

The SEC’s New Rules on Climate

This episode of ESG in Conversation dives into the SEC’s new climate disclosure rules and what they mean for companies and investors.

ESG in Conversation: The AI Revolution Comes to ESG

Learn how AI technology is being leveraged in the world of ESG research and analysis in our latest episode.

ESG in Conversation: Asset Owners Share Their Views on the Changing Investment Landscape

Tune in to learn about asset owners’ views on ESG investing, discover what major food companies can do to reduce their rising emissions, and find out whether companies are ready for CSRD.

ESG in Conversation: Combatting Greenwashing in Financial Markets

We’re talking all about greenwashing this episode. What is it? How can asset managers spot it? And what can they do to steer clear in their portfolios and investment products?