Sustainability - Linked Loans and Bonds - Advanced - USA

• Focus on actual construction of sustainability-linked loans and 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 bonds
• Thorough review of related research and its implications
• Perspective based on international experience in ESG
• Practical insights on ESG policy at the level of the issuers and financial institutions

• Have 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 bonds
• To grow an understanding of the key KPIs and performance targets used for sustainability-linked loans and bonds
• Understand how sustainability-linked loans and bonds can play into opportunities from new policy and regulatory initiatives
• Become able to hold a basic level discussion about the key sustainability characteristics of a potential sustaianbility-linked loan with a corporate

Introduction to sustainability-linked loans and bonds

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

Structuring sustainability-linked loans and bonds

• Selection and calibration of KPIs and calibration of sustainability Key Performance Targets (KPIs)
  • 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
  • External validity of KPIs
  • Benchmarking of KPIs
• Selection and calibration of Sustainability Performance Targets (SPTs) to measure progress towards KPIs
  • Time horizon of SPTs
  • Quantifying ambitions
  • Disclosing SPTs
• Setting loan and characteristics
  • Trigger events
  • Margin ratchet

Ensuring verity of sustainability-linked loans and 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
• External reviews

The Sustainability - Linked Loans and Bonds course trainer specializes in sustainable finance, with both executive and non-executive experience. She has worked for asset owners, fund managers, social enterprises, and universities across Europe, Asia, Middle East and Americas. By bridging academia and practice she is able to deliver ambitious yet pragmatic change. The trainer sat on the UK Prosperity Fund’s Brazil Green Finance Innovation Committee and is a member of Standard&Poor’s Global Sustainable Finance Scientific Council. She is part of the Editorial Board of London Institute for Banking and Finance, and is the academic advisor of the CFA’s ESG Investing certification. She has worked on sustainable finance for financial institutions such as Amundi, Natixis, Local Pensions Partnership (UK government pension fund) and Ossiam, a smart beta investment firm, as well as led the University of Cambridge’s industry-led initiative Investment Leaders Group. She also contributes to academic programs for University of Cambridge and ESSEC Paris-Singapore, and delivers capacity building for the International Capital Market Association on sustainable fixed income products. She holds a joint MBA-MSc on sustainability from HEC Paris / FGV.

Sustainability-linked loans and bonds, and other types of sustainability-related fixed income, which finance companies, agencies and sovereigns ‘transitioning’ have passed the $1trillion dollar 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 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 side, sustainability-linked loans allow corporates to raise funding that, while for general use, incentivizes them to deliver to their sustainability-related targets.

This Sustainability - Linked Loans and Bonds 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 include expectations of the market and key principles to be followed.