Developments in the ESG Bond Market

The ESG landscape continues to evolve. In this article, we look at some of the developments in the ESG bond market, in particular, transition bonds and sustainability re-linked bonds, as well as the expansion of the Singapore Sustainable Bond Grant Scheme to cover certain costs incurred for sustainability-linked bonds issuances.

The following aspects are covered in this article:

1. The key elements in ICMA’s Climate Transition Finance Handbook in respect of issuer-level disclosure recommendations for transition bonds issuances (a brief summary of key terms of selected transition bonds issuances have also been included for comparative purposes)
2. Issue of the world’s first sustainability re-linked bonds which features a “re-linking” mechanism where interest rate of the bonds are adjusted according to margin adjustments of the underlying sustainability-linked loans
3. Key criteria of the Singapore Sustainable Bond Grant Scheme

Please also see previous thought leadership piece entitled “Sustainability-linked bonds – the next bigthing to hit the bond markets”.