In order to meet the global objectives enshrined within the Paris Agreement on Climate Change to keep the global temperature rise this century well below 2°C above pre-industrial levels and to pursue efforts to limit the temperature increase even further to 1.5°C, significant financing is needed. To help facilitate these flows, the Climate Transition Finance Handbook published in December 2020 seeks to provide clear guidance and common expectations to capital markets participants on the practices, actions and disclosures to be made available when raising funds in debt markets for climate transition-related purposes.
The Climate Transition Finance Handbook acts as additional guidance for issuers seeking to utilise green bonds, sustainability bonds or sustainability-linked bonds towards the achievement of their climate transition strategy. When raising funds for climate transition-related purposes, issuers are encouraged to reference the recommendations outlined in the Climate Transition Finance Handbook in their reporting.
For additional information on how to interpret this guidance especially for its practical application for transactions, as well as in the context of market developments and complementary initiatives, see the Guidance Handbook.
Climate Transition Finance Handbook 2020
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Translations of the Climate Transition Finance Handbook
Further translations are in progress and will be published here when available.
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The Methodologies Registry is a list of tools to specifically help issuers, investors, or financial intermediaries validate that their emission reduction trajectories/pathways are "science-based", specifically in the context of Element 3 of the Climate Transition Handbook. We note that there are several initiatives all working to the same goal of supporting moves towards a net zero economy. There are many tools, methods, scenarios and initiatives available in the market and each play a role, and are often tailored towards different audiences. Usually, these resources complement each other and can be combined.
This list is dedicated purely towards the validation of specific emission reduction trajectories/pathways and is therefore not all encompassing. It does not seek to provide a comprehensive repository of all the complementary tools that an issuer, investor, or financial intermediary may also utilise to design, report, or guide the setting of those trajectories (Element 1 of the Climate Transition Handbook).
This document should be seen as live, i.e. it will evolve over time. The pace of regulatory change and data harmonisation will continue to increase and as such pathway tools and methodologies will evolve and develop and see regular updates over the coming years.
The CTF WG welcomes feedback (to greenbonds@icmagroup.org) and will continue to monitor developments in the market and evaluate if updated guidance is warranted.