Bond Issuers invited to Join Green Bond Pledge

Green Bond Pledge moves to expand market for sustainable finance

Today, former UN Climate Chief Christiana Figueres opened the Climate Bonds Initiativ e annual conference in London by calling on cities, national governments, and corporate bond issuers to commit to expand the green bond market. Addressing delegates from 55 nations, Ms. Figueres, Convenor of Mission 202 0 announced a new Green Bond Pledge for bond issuers.

The Green Bond Pledg e outlines the smart forward-thinking investment strategy that motivates bond issuers — including cities, other public authorities and some of the world’s largest corporate institutions — to prioritize use of green bond finance. In particular, the aim is to align new infrastructure investments with sustainable standards and priorities, to meet the escalating challenges of climate change and accelerate the transition to a low-carbon economy.

In the next few decades, the world will require billions of new dwellings, millions of roads, tens of thousands of bridges, and critical infrastruture for energy, transit, coastal resilience, and waste management. The relationship of all of that construction to the forces moving through Earth’s climate system will determine whether value is reliable, secure and generative of good outcomes. Green bonds are a necessary step toward ensuring future finance is climate-smart and able to generate reliable returns.

During climate finance meetings prior to the Paris Agreement, Ms. Figueres called on global financial leaders to re-imagine finance itself as needing to become climate-smart to achieve its professed aims of reliable return on investment over time. The Resilience Intel effort is founded on the insight that if we do not succeed in making all finance climate-smart, we will not succeed in achieving sustainable prosperity anywhere.

Climate change threatens our quality of life and poses material risk to our communities. The Green Bond Pledge is a simple, straightforward declaration with broad and far-reaching impact, understanding that replacing old economy standards with green infrastructure priorities will feed resilient new value into all areas of the economy.

The four-line Pledg e is presented here…

The Green Bond Pledge

Issuer Pledge: Agencies, Government and Companies

We agree that all infrastructure and capital projects will need to be climate resilient and where relevant, support the reduction of greenhouse gas emissions.

We welcome the role that green bonds can play in helping to achieve the financing of that infrastructure.

As a signatory to this pledge, we support the rapid growth of a green bonds market, consistent with global best practices that can meet the financing needs we face and issue, whenever applicable, bonds for infrastructure as green bonds.

We pledge to support this goal by establishing a green bonds strategy that will finance infrastructure and capital projects that meets the challenges of climate change while transforming our community into a competitive, prosperous and productive economy.

More than a dozen organizations from around the globe have helped to develop the pledge, including the Climate Bonds Initiative, Mission2020, CERES, CDP, Citizens’ Climate Lobby, the California Governor’s Office, the California Treasurer’s Office, Global Optimism, NRDC and The Climate Group.

Patricia Espinosa, Executive Secretary of UN Climate Change (UNFCCC) and a Global Climate Action Summit co-chair:

Green bonds are among an array of exciting and rapidly growing, new financial instruments that are going to help us get there. I warmly welcome the Pledge as one among many inspiring new initiatives that will launch climate action in 2018 to the next level of ambition.

Joseph Robertson, Global Strategy Director for CCL and CCE, and lead strategist for Resilience Intel, said:

The Green Bond Pledge sends a simple, clear signal that signatories understand the interactive, evolving landscape of value in which the bonds they issue will have to operate. By mainstreaming climate-smart green bonds for major investment priorities, we can make the whole economy more efficient at building value for people and institutions.

The Green Bond Pledge is part of the ongoing multilevel, multilateral preparatory work for the Global Climate Action Summi t, which will take place in San Francisco, September 12-14, 2018.

Several resources exist to address what constitutes a green bond, including those under the certification protocols of the Climate Bonds Initiative Climate Bonds Standar d and International Capital Markets Association Green Bond Principle s. Other financial market participants have green bond definitional products, including Moody’s, S&P Global Markets, and Bloomberg/MSCI/Barclays.

To speed the shift to 100% sustainably qualified infrastructure investment, fully electric, clean-energy powered public transit systems are a universally valuable local application of green bond financing. The Barcelona Tram, pictured above, uses 100% clean energy and regenerative braking to achieve a climate-smart accessible mode of urban transport.

The long-term Resilience Intel aim is to bring together these and other diverse methodologies for evaluating sustainability and resilience-building value of investments and expenditures, to produce a high-resolution, locally rooted, globally relevant top-line indicator for overall resilience value. The expansion of new climate-smart financial instruments and the deployment of new climate-smart infrastructure, will be of great value for ensuring this complex, evolving resilience value metric points investors and policy planners toward the highest value opportunities.