The ICMA have announced today that the Green Bond Principles (GBP) Resource Centre is now operational.
Amongst various other resources, as outlined further below, it importantly contains standardised disclosure templates. The ICMA recommend the use of these standardised templates and they note they have already been adopted by a substantial number of market participants.
The ICMA advised “It is expected that this new resource will add significantly to market transparency allowing investors to determine the extent to which Green Bond issuers are aligned with the Green Bond Principles. This will also support the growth of Green Bond investment and promote further development of the market which is seeing record issuance with $64.3 billion this year to date representing 1.5 times the amount raised during the entire previous year.”
Eila Kreivi, Chair of the GBP Steering Group, and Head of Capital Markets Department at EIB, also concurred: “As the GBP have become a key reference for green bonds, market participants increasingly called for a means of simplifying evidence of alignment with the GBP and standardizing external review summaries, in a way that enhances comparability. These new tools help to do just that.
The Resource Centre is divided into 3 tabs where investors and other market participants can find the following info:
Green Bond database & FAQwhich contains an Information Template (for issuers to inform the market on GBP alignment) and an External Review Form (a public disclosure form for external reviews).
Use of Proceeds This section includes various market participants’ scope and objectives of issuance to date.
Other Resources This section includes tutorials and rules.
What are the ICMA criteria to qualify as a Green Bond?
According to the ICMA, Green Bonds are any type of bond instrument where the proceeds will be exclusively applied to finance or re-finance in part or in full new and/or existing eligible Green Projects and which are aligned with the four core components of the Green Bond Principles. It is important to note that Green Bonds should not be considered fungible with bonds that are not aligned with the four core components of the Green Bond Principles.
What are those Green Bond Principles?
The 4 components are:
1. Use of Proceeds
2. Process for Project Evaluation and Selection
3. Management of Proceeds
The ICMA have explained that the Green Bond Principles are voluntary guidelines that recommend transparency and disclosure and promote integrity in the development of the Green Bond market by clarifying the approach for issuance of a Green Bond. The GBP are intended for broad use by the market: they provide issuers with guidance on the key components involved in launching a credible Green Bond; they aid investors by promoting availability of information necessary to evaluate the environmental impact of their Green Bond investments; and they assist underwriters by moving the market towards expected disclosures which will facilitate transactions.
To read more about the popularity of Green Bonds please read yesterday’s CMD headline article.
To find out more about total global Green Bond issuance please use our Data Sheet tool.
For example to see total USD Green Bond issuance over the last 12 months click on the above Data Sheet link and then select the below criteria:
Report Type = By Security Type
Report Output Type = Issuance
Report Currency = USD
Start date = 01/11/2015 and End date = 01/11/2016
Frequency = Monthly
Green Bond = tick it
Scroll down and click on 'Search' and the information will appear on the right hand side