Advanced ESG & Climate Finance Loans Structuring

Introduction

Current state of green, social, sustainable and sustainability-linked loans in 2023/24

• Corporate and institutional issuance/loans update.
• Emerging trends in loan transactions.
• Sustainable Finance challenges and opportunities in 2023/24.

Green loans

Green Financing Framework due diligence

Case study 1: Analysing a significant corporate green finance programme/framework.

• How to assess the coherence of a corporate framework.
  • Mapping corporate strategy and SDGs commitment.
  • Adherence to best market practice.
  • Mapping to LMA Green Loan Principles/other standards.

• Creating a due diligence checklist.
  • Classification of risks.
  • Identifying ESG exclusions for project eligibility.

• Using publicly available information: Second Party Opinion/Verification reports + others
  • LMA/ICMA recommendations.
  • SPO reports, providers, independence and value add.
  • Verification reports, providers, independence and value add.
  • Other sources of information: industry bodies/think-tanks.

• Examine eligibility criteria for green projects and what questions to ask.
  • Use of Proceeds
  • Project Evaluation
  • Project selection
  • Deployment
• What extra information do you need as a lender?
  • Borrower competency
  • Borrower infrastructure (people, systems, data)

 Green and social loan monitoring and reporting

• Best practice for green and social loan monitoring and reporting
  • Tracking and assessing Use of Proceeds within the borrower
  • Account segregation
  • Borrower governance
  • Reporting periods
  • Individual project/portfolio project choices
  • Borrowers and confidentiality

• How to assess impact.
  • Best practice – using the ICMA Frameworks for Green + Social finance.
  • Sector-specific guidance
  • Core Indicators
  • Other indicators
  • Mapping to SDGs – one approach

Social loans

Delegates will explore the current challenges in classifying social projects and measuring their impact.

Case study 2: analysing a bank social finance programme/framework.

• Assessing the coherence of a social finance framework (SDGs and strategy).
  • Mapping corporate strategy and SDGs commitment
  • Adherence to best market practice
  • Mapping to LMA Social Loan Principles/draft Taxonomies

• Creating a due diligence checklist.
  • Classification of risks
  • Project eligibility

• Using publicly available information within Second Party Opinion/Verification reports.
  • LMA/ICMA recommendations for Social finance
  • SPO examples

• Examine eligibility criteria for social projects and what questions to ask.
  • Use of Proceeds
  • Project Evaluation
  • Project selection
  • Deployment

Social impact reporting

• Social impact.
• Impact reporting for social projects – using the ICMA Framework.

-Outputs

-Outcomes

-Impact

-Impact confirmation on target population

Sustainable loans

• Understanding the importance of a ‘Just Transition’
• Combining Green and Social loan due diligence

-Assessing the interplay between the two components

Sustainability-linked loans

Case study 3: analysing a Sustainability-linked corporate framework.

• How to assess the coherence of a sustainability-linked finance framework.
  • Mapping corporate strategy and SDGs commitment
  • Adherence to best market practice
  • Mapping to LMA Sustainability-Linked Loan Principles

• Determining the borrower’s ambition
• Understanding the mechanics and choices of KPIs and SPTs

• Common primary and secondary KPIs
• Materiality
• Strategic significance
• Measurability
• Benchmarking
• SPT disclosure

• Using publicly available information within Second Party Opinion/Verification reports.
  • SPO examples
  • LMA/ICMA recommendations for Sustainability-Linked Loans/Bonds

The trainer is an experienced international and emerging market capital markets consultant. He actively consults on Sustainable Finance to International Financial Institutions utilising his technical and leadership knowledge and skills. He has first-hand experience in over 38 emerging and frontier markets as an investor in a range of ESG/Climate and non-ESG debt, equity and loan investment products.

As a former senior banker in the European Bank for Reconstruction and Development he led an advisory and structuring team which worked closely with multi-industry-sector bankers and risk officers to create loan, bond and equity investments in over 25 local currencies. He also has considerable expertise in debt and equity capital market governance and strategy.

• Examine as an investor/lender/advisor the mechanics of assessing and structuring green, social, sustainable and sustainability-linked loans using best market practice and current case studies in the loan and capital markets.
• Conduct due diligence on a corporate Green Financing Framework.
• Understand and apply best practices for Green loan monitoring and Impact reporting.
• Analyse and conduct due diligence on a social financing framework.
• Understand and apply best practices for social loan monitoring and impact reporting.
• Examine sustainable loans: combining environmental and social projects in financings.
• Assess sustainability-linked loans: explore the best market practice in KPI and SPT selection, mechanics and performance scenarios over time.
• Examine loan monitoring and impact reporting best practices for green and social loan case studies.

• This is a unique training that emphasises practical ESG loan structuring skills.
• Focuses on transferring diagnostic due diligence expertise.
• Deep dive focus on monitoring and impact reporting.
• The trainer is an active ESG market practitioner.

Our advanced ESG and climate finance loans structuring course is a must for investors and lenders in ESG loans, and it focuses on developing advanced due diligence and loan product structuring knowledge. The emphasis is on practical and implementable skills that will enable each delegate to confidently engage in this rapidly growing asset class.

This course is suitable for:

• Asset/fund managers
• Banking and Corporate Credit
• Banking lawyer
• Corporate bankers
• Corporate/Commercial lawyer
• Corporate finance advisor
• Credit Risk
• Finance Director
• In-house legal counsel
• Investment Banking
• Banking Operations Department
• Private Equity
• Project and Renewables Finance
• Project and Renewables Finance Lawyer
• Risk management
• Sustainable Finance Departments
• Corporate Treasury
• Investment department

ESG loans have seen exponential growth since 2018. Our advanced ESG loan course focuses on enabling participants to build their loan due diligence and structuring skills. By learning to do so, investors, lenders and their advisors can better understand what to expect from borrowers and why. The absence of certified public market data in the loan market creates a practical challenge. This course will enable you to seek and utilise data from different sources to give your investment committee more information.

This course is a deep dive into green, social, sustainable and sustainability-linked loans and uses current case studies as the basis of learning. Participants are encouraged to bring their own relevant ESG challenges to the programme to deepen their learning and application.