Fundamentals of ESG and Climate Finance Loans - ASPAC

• Focuses on ESG and Climate Finance loans and their mechanics.
• Uses current market data and transactions to relate best practice.
• Trainer has direct experience in ESG as an investor & is a Climate Finance consultant to international banks.
• In-depth consideration of best practice via current case studies.
• Applies the latest APLMA's Green, Social and Sustainability-linked loan principles.
• Explores green regulation, the EU Taxonomy and reporting directives.
• Considers ESG and Climate Finance from both lender’s/investor’s perspectives.

• Understand the strategic importance of ESG & Climate Finance loans.
• Examine the characteristics of green, social and sustainability-linked loans in the context of current loan and capital market transactions.
• Use ‘Climate Bonds Initiative’ public data on Climate Finance to deepen understanding of green finance.  
• Understand and apply the APLMA’s ESG loan principles: Use of Proceeds, Evaluation, Selection, Management of proceeds and Reporting to case studies.
• Introduction to Sustainable regulations, the EU Taxonomy & Reporting directives.
• Examine two leading borrowers’ Green and Sustainable Financing Frameworks & how to conduct due diligence as a lender/investor
• Introduction to social loans and bonds & the EU Social Taxonomy
• Explore the creation of social loans and bonds via a case study.
• Understand the roles of external party opinions, verification, assurance & certification.

Introduction

• The context of debt investing in ESG and Climate Finance.
• United Nations Sustainable Development Goals
• ESG investment – players and objectives

Green loans

• What constitutes a green loan?
• APLMA Green Loan Principles
• Green Finance plenary case study & discussion
• Green loan pricing plenary discussion
• Market-based green loan/bond pricing using the Climate Bonds Initiative data
• Use of Proceeds
• Project Evaluation and Selection
• Management of Proceeds
• Reporting
• External Reviews & how to utilise them
• EU Green Deal, regulation & the EU Taxonomy
• Other Taxonomies

Social loans

• What is a social loan?
• APLMA Social loan principles
• Social loan/bond case study
• Evolving a Social Taxonomy
• Social loan core components
• Pricing social loans
• Trends in social lending

Sustainability-linked loans

• Defining sustainability-linked loans
• How they differ from green and social loans
• APLMA Sustainability-Linked loan principles
• Key Performance Indicators (KPIs) & Sustainability Performance Targets (SPTs)
• Calibration of KPIs and SPTs
• Sustainability-linked loan case study – analyse an issuer’s sustainability framework and second party opinion

Wrap up / Q and A

The trainer is an experienced international and emerging market capital markets consultant. He actively consults on Climate Finance to International Financial Institutions in Africa, Asia and emerging Europe 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 ESG/Climate and non-ESG debt, equity and loan investment products.

As a former senior banker In EBRD he led a 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 capital market governance and strategy.

Green, social and sustainability-linked loans have increased to an estimated $78.6 billion in 2021 (2022 survey by BNPP and City UK) and are set to significantly grow. This interactive course will provide participants with an introduction to green, social and sustainability linked loans and will focus on them from a lender’s perspective.

Using current market data and public transactions this course will enable participants to understand the practicalities of assessing, pricing and structuring green, social and sustainability-linked loans.

The advanced approach of the EU, its Green Deal, Taxonomy and regulation is considered to inform the learning. Borrowers’ green and sustainable frameworks and second party opinions are evaluated within case studies to allow participants to recognise best practice in ESG and Climate Finance loans.