Trucost and Golden Credit Rating International partnered to develop this framework to share it with all market players in China as a contribution to the debate on how to assess green bonds. By enabling a green rating in parallel to a bond’s credit rating, the assessment will provide investors with a clear indication of how green a green bond is and how well it conforms with market expectations.
The design of this framework consists of four key elements: align with expectations of key stakeholders such as the investor community, and China’s bond market regulators and green finance think tanks; prevent greenwashing in environmental performance assessment; review common practices of environmental performance assessment in the market; identify areas of connection between the green bond assessment framework and environmental regulations in China.
The framework will also keep track of the achievement of the expected environmental benefits of projects financed by the bond, and the implementation of impact mitigation measures as proposed in the project’s Environmental Impact Assessment prior to bond issuance. This mechanism will cover the pre- and post-issuance stages, and may even be extended to operational stage of the project, depending on the maturity of the bond.
The GreenFin Summit follows a successful launch event in 2019. That invitation-only event brought together 100 corporate sustainability leaders, major public-sector pension fund executives and leading financial institutions, with over a trillion dollars of combined assets under management. The discussion broached vital topics in ESG that will be expanded upon at the 2020 Summit. Richard Mattison...