The Green Bond Principles: ICMA : 16 June 2016

The Green Bond Principles: ICMA : 16 June 2016

CICA Summary

Introduction

The Green Bond Principles (GBP) are voluntary process guidelines. The GBP are intended for broad use by the market and are designed to provide the information needed to increase capital allocation to environmentally sustainable purposes.

GBP is famed by the same four core components: Use of Proceeds, Process for Project Evaluation and Selection, Management of Proceeds and Reporting. GBP is designed to help investors and the market generally, to establish the alignment of issuances with the GBP.

  1. Use of Proceeds

Green Projects should be appropriately described in the legal documentation for the security, aiming to address key areas of concern such as climate change, natural resources depletion, loss of biodiversity and/or pollution control.

  1. Process for Project Evaluation and Selection

The issuer should outline: a process to determine how the projects fit within the eligible Green Projects categories mainly eligibility criteria and environmental sustainability objectives, taking also into consideration the quality of the issuer’s overall profile and performance regarding environmental sustainability.

  1. Management of Proceeds

The issuer should make known to investors the intended types of temporary placement for the balance of unallocated proceeds.

  1. Reporting

Issuers should make, and keep, readily available up to date information on the use of proceeds to be renewed annually until full allocation. Leading International Financial Institutions have developed a reference framework for impact reporting that outlines core principles and recommendations and puts forward core indicators for two sectors: energy efficiency and renewable energy.

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