Green bonds enable capital-raising and investment for new and existing projects with environmental benefits. The Green Bond Principles (GBP) seek to support issuers in financing environmentally sound and sustainable projects that foster a net-zero emissions economy and protect the environment. GBP-aligned issuance should provide transparent green credentials alongside an investment opportunity. By recommending that issuers report on the use of Green Bond proceeds, the GBP promote a step change in transparency that facilitates the tracking of funds to environmental projects, while simultaneously aiming to improve insight into their estimated impact. The GBP, updated as of June 2021, are voluntary process guidelines that recommend transparency and disclosure and promote integrity in the development of the Green Bond market by clarifying the approach for issuance of a Green Bond. The GBP recommend a clear process and disclosure for issuers, which investors, banks, underwriters, arrangers, placement agents and others may use to understand the characteristics of any given Green Bond. The GBP emphasise the required transparency, accuracy and integrity of the information that will be disclosed and reported by issuers to stakeholders through core components and key recommendations.
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.
In June 2022, Appendix 1 of the GBP was updated to make a distinction between “Standard Green Use of Proceeds Bonds” (unsecured debt obligation) and “Secured Green Bonds” and to provide further guidance on green covered bonds, securitisations, asset-backed commercial paper, secured notes and other secured structures.
The Green Bond Principles (GBP) 2021 (with June 2022 Appendix 1)
Translations of the Green Bond Principles
Please note that the following translations are related to the 2017, 2018, 2021 and 2021 (with June 2022 Appendix 1) GBP editions, therefore the edition that each translation currently refers to is indicated below. They are being updated with the 2021 changes progressively.
FAQs
The Green Bond Principles (GBP) are voluntary process guidelines that recommend transparency and disclosure and promote integrity in the development of the Green Bond market by clarifying the approach for issuance of a Green Bond.
What are the eligible green projects for ICMA? ›
The eligible Green Project categories, listed in no specific order, include, but are not limited to: renewable energy (including production, transmission, appliances and products); energy efficiency (such as in new and refurbished buildings, energy storage, district heating, smart grids, appliances and products);
What are the 4 principles of green bond? ›
Green Bond Frameworks Issuers should explain the alignment of their Green Bond or Green Bond programme with the four core components of the GBP (i.e. Use of Proceeds, Process for Project Evaluation and Selection, Management of Proceeds and Reporting) in a Green Bond Framework or in their legal documentation.
What are the four components of ICMA? ›
The four core components as outlined by ICMA green bond principles are: i. Use of proceeds; ii. Project evaluation and selection; iii. Management of proceeds; and iv.
What are ICMA principles? ›
ICMA serves as Secretariat to the Green Bond Principles (GBP), the Social Bond Principles (SBP), the Sustainability Bond Guidelines (SBG) and the Sustainability-Linked Bond Principles (SLBP) - collectively known as "the Principles", providing support while advising on governance and other issues.
What are the goals of the ICMA? ›
The mission of ICMA is to promote resilient well-functioning international and globally coherent debt securities markets, which are essential to fund sustainable economic growth and development.
What does ICMA do? ›
Founded in 1914, ICMA, the International City/County Management Association, advances professional local government through leadership, management, innovation, and ethics. Our vision is to be the leading professional association dedicated to creating and supporting thriving communities throughout the world.
What is the second party opinion of the ICMA? ›
How it works? The Second Party Opinion assesses the Bond Framework in relation to the four main components of the ICMA principles: The methodology also maps the Use of Proceeds categories with the UN Sustainable Development Goals (SDGs).
What are eligible green assets? ›
Eligible Green Assets means any existing, on- going and/or future loans or any other form of financing from Eligible Sectors selected by the Issuer, which meet the Eligibility Criteria, all in accordance with the BNP Paribas Green Bond Framework.
What are the basics of green bonds? ›
A green bond is a debt security issued by an organization for the purpose of financing or refinancing projects that contribute positively to the environment and/or climate. A green bond is alternatively known as a climate bond.
The cornerstone of a Green Bond is the utilisation of the proceeds of the bond for eligible Green Projects, which should be appropriately described in the legal documentation of the security.
What are the blue bonds for ICMA? ›
Blue Bonds and Blue Loans are innovative financing instruments that earmark funds exclusively for ocean-friendly projects and critical clean water resources protection.
What are the core values of the ICMA? ›
These core values—Ethical, Leadership, Accountable, Transparent, Respectful, Collaborative, and Disciplined—guide our actions in conducting business worldwide.
What defines ICMA? ›
The International Capital Markets Association—the regulatory body for the bond market.
What has been developed by ICMA? ›
ICMA stated aims are to promote high standards of market practice, appropriate regulation, trade support, education and communication. It produces standard documentation for transactions such as equity and debt issuance and repos.
What are the four principles of a green loan? ›
The GLP set out a framework of market standards and voluntary recommended guidelines to be applied by participants on a deal-by-deal basis that classifies the instances in which a loan may be categorized as "green." To qualify as a green loan, the loan must comply with the following four components of the GLP: 1) use ...
What are the equator principles of ICMA? ›
The Equator Principles (dated June 2013) is a risk management framework, adopted by financial institutions, for determining, assessing and managing environmental and social risk in projects. It is primarily intended to provide a minimum standard for due diligence to support responsible risk decision-making.
What are the 6 goals identified by the green taxonomy? ›
The six environmental objectives of the Taxonomy are: (1) climate change mitigation, (2) climate change adaptation, (3) sustainable use and protection of water and marine resources, (4) transition to a circular economy, (5) pollution prevention and control, and (6) protection and restoration of biodiversity and ...
Green bonds enable capital-raising and investment for new and existing projects with environmental benefits. The Green Bond Principles (GBP) seek to support issuers in financing environmentally sound and sustainable projects that foster a net-zero emissions economy and protect the environment. GBP-aligned issuance should provide transparent green credentials alongside an investment opportunity. By recommending that issuers report on the use of Green Bond proceeds, the GBP promote a step change in transparency that facilitates the tracking of funds to environmental projects, while simultaneously aiming to improve insight into their estimated impact. The GBP, updated as of June 2021, are voluntary process guidelines that recommend transparency and disclosure and promote integrity in the development of the Green Bond market by clarifying the approach for issuance of a Green Bond. The GBP recommend a clear process and disclosure for issuers, which investors, banks, underwriters, arrangers, placement agents and others may use to understand the characteristics of any given Green Bond. The GBP emphasise the required transparency, accuracy and integrity of the information that will be disclosed and reported by issuers to stakeholders through core components and key recommendations.