Sustainability - Linked Loans and Bonds - Advanced

PRE-REQUISITE 

As this is an advanced course, participants are expected to be familiar with the general characteristics and market of sustainable bonds and loans

Introduction to Sustainability-Linked Loans and Sustainability-Linked Bonds

• Sustainability and sustainability linked financing: impact and risk
  • Realising sustainability-related opportunities
  • Managing sustainability-related risks
• Sustainability-linked loans and sustainability-linked bonds framework
  • Use of proceeds (sustainable activities and projects)
  • Incentivisation
• Standards, taxonomies, sustainability-linked loans and bonds principles
  • Sustainability-linked loan principles
  • Sustainability-linked bonds principles
  • SDGs, EU Taxonomy of Sustainable Activities, and other jurisdictions’ targets

Structuring Sustainability-Linked Loans and Sustainability-Linked Bonds

• Selection and calibration of KPIs and calibration of sustainability loans Key Performance Targets (KPIs) including sustainability performance targets
  • Choosing relevant KPIs
  • Core KPIs across environmental and social themes
  • Secondary KPIs across environmental and social themes
  • Material KPIs for different sectors
  • Aligning KPIs with external standards and objectives, such as the EU Taxonomy
  • Consistent measurability of KPIs
  • The external validity of KPIs
  • Benchmarking of KPIs
• Selection and calibration of Sustainability Performance Targets (SPTs) to measure progress towards KPIs
  • The time horizon of SPTs
  • Quantifying ambitions
  • Disclosing SPTs
• Setting loan and characteristics
  • Trigger events
  • Margin ratchet

Ensuring The Verity of Sustainability-Linked Loans and Sustainability-Linked Bonds

• Reporting and verification
• Avoiding greenwashing in sustainability loans and bonds
  • Clarity of definitions
  • Clarity of scope, i.e. whether or not life cycles, substitutions, and supply chains are included
  • Clarity of baseline
  • Reliability of data
  • Time-bound SPTs (Sustainability Performance Targets)
  • External reviews

Our Sustainability - Linked Loans & Bonds course trainer has a comprehensive financial services background in capital markets and as an originator. In a career spanning more than thirty years, she has built a consistent record in developing new business lines ab initio in several markets, notably liability management and, in the past ten years, sustainable capital markets.

She oversaw BNP Paribas’ fast-growing sustainable bond franchise for four years, before being promoted to a more strategic role advising the bank’s key issuing and clients on sustainable finance, including financial products in M&A processes. Before this, she was head of liability management, and previously, Head of Corporate EMTN at Deutsche Bank UK.

Since leaving the industry in 2019, the trainer has continued to work in the field of sustainable finance, with a range of roles including working with the Green Finance Institute, Impact Investing Institute and the Grantham Research Institute at the London School of Economics and Political Sciences. She also worked for a German-based fund, assisting them on how to optimise the due diligence process in the absence of equity ownership.

Our sustainability-linked loans course trainer has a strong interest in education, and throughout her career, has been involved in providing training and mentoring in a professional capacity. Most recently, she played a key role in capacity building around awareness of sustainability risks and opportunities for colleagues and clients at BNP Paribas. She was instrumental in delivering well-regarded sustainable finance training around the world on behalf of ICMA and IFC. She is a member, and the former chair, of the British Standards Institution’s committee of experts in sustainable finance. In 2016, she completed the Post-Graduate Certificate in Sustainable Business at the Cambridge Institute for Sustainability Leadership.

Our sustainability-linked bonds training will cover the following:

• Help you gain an understanding of the role corporates and financial institutions can play in the transition to a low-carbon society, especially via sustainability-linked loans and sustainability-linked bonds.
• To grow an understanding of the key KPIs and performance targets used for sustainability-linked loans and sustainability-linked bonds.
• Understand how sustainability-linked loans and sustainability-linked bonds can play into opportunities from the new policy and regulatory initiatives.
• Become able to hold a basic level discussion about the key sustainability characteristics of a potential sustainability-linked loan with a corporate.

• Focus on the actual construction and principles of sustainability-linked loans and sustainability-linked bonds.
• Insight into practical aspects of the implementation of the market principles.
• Understanding of how to ensure reliable sustainability characteristics in sustainability-linked loans and sustainability-linked bond issuance.
• A thorough review of related research and its implications.
• Perspective based on international experience in ESG (Environment Social and Governance).
• Practical insights on ESG policy at the level of the issuers and financial institutions.

PRE-REQUISITE

As this is an advanced sustainability-linked loans training course, participants are expected to be familiar with the general characteristics and market of sustainable bonds and loans.

Who should attend:

• Treasury departments of corporates considering issuing sustainable fixed income or seeking sustainable loans.
• Investors considering investing in sustainable fixed income.
• Investment bank professionals involved in fixed-income products and issuances.
• Corporate bank professionals wishing to structure or offer (sales) sustainable loans.

Sustainability-linked loans and bonds, and other types of sustainability-related fixed income, which finance companies, agencies and sovereigns ‘transitioning’ have passed the $1 trillion milestone for the amount issued since the first ever green bond in 2007. Sustainability-linked loans/bonds are an important financial innovation as they are particularly suited for providing the much-needed capital in bond and loan markets to be steered to achieve the UN Sustainable Development Goals and large-scale policy interventions such as the EU Green Deal and the U.S. Inflation Recovery Act.

Fast growth in this market sector is resulting in unprecedented opportunities. On one hand, sustainability-linked loans address the needs of financial institutions to steer their products to more sustainable alternatives, making them appropriate vehicles to tap into their capital holdings. On the other hand, sustainability-linked loans allow corporates to raise funds that, while for general use, incentivise them to deliver on their sustainability-related targets.

This sustainability-linked loans training course delivers the advanced understanding that those working for and with corporates need to identify KPIs and targets that are relevant for robust sustainability-linked loans/bonds. It also includes expectations of the market and key principles to be followed.