Green and Social Bond Principles with ICMA underline relevance of Social Bonds in addressing COVID-19 crisis and provide additional guidance


31 March 2020 The Executive Committee of the Green Bond Principles, the Social Bond Principles and the Sustainability Bond Guidelines (the Principles), supported by the International Capital Market Association (ICMA), underline that existing guidance for Social and Sustainability Bonds is immediately applicable to efforts addressing the COVID-19 crisis. Additional advice for issuers in the form of new Q&A and case studies has been provided.

Social Bonds finance projects that directly aim to address or mitigate a specific social issue and/or seek to achieve positive social outcomes directed towards a specified target population. Sustainability bonds finance both green and social projects. The global COVID-19 outbreak is a social issue that threatens the well-being of the world’s population, especially the elderly and those with underlying health problems. In addition, millions of people around the world are suffering, or will be suffering, from the resulting economic downturn.

Illustrative examples for eligible social projects can include COVID-19 related-healthcare and medical research and development of vaccine, investment into additional medical equipment, or manufacturing facilities to produce more health and safety equipment and hygiene supplies, and specific projects designed to alleviate unemployment generated by the crisis. These should especially target specific groups directly impacted by the virus outbreak, although they may also seek to support a wider population affected by the economic crisis.

Lars Eibeholm, Chair of the Executive Committee of the GBP SBP, Head of Treasury and Sustainability at Nordic Investment Bank, stated: “Based on market requests the Social Bond Working Group initiated the targeted Q&A. The aim is to provide additional information for issuers’ Social Bond framework on how to communicate their strategies and specific projects to alleviate the negative impact of the pandemic. Under these exceptional circumstances, it is important to maintain transparency and keep the long term targets on positive social impact.”

Martin Scheck, Chief Executive of ICMA, stated: “We believe that Social and Sustainability Bonds can provide an immediately actionable channel for the market to finance projects that directly contribute to alleviating the social and economic impact of the COVID-19 crisis. We strongly support the efforts of the GBP SBP Executive Committee to provide further guidance to the market for these operations”.

Download the Q&A for Social Bonds related to Covid-19

View the 2018 Social Bond Principles
View the Sustainability Bond Guidelines
View the 2018 Green Bond Principles
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