ImpactAlpha, Dec. 8 – Issuers of social, green and other sustainability bonds seek “second-party opinions,” or SPOs, from ratings agencies like S&P Global to reassure investors that the bond issuance aligns with stated goals.
Shades of Green, a subsidiary of Norwegian climate research institute CICERO, provided the SPO for the World Bank’s original green bond framework in 2008. S&P Global acquired Shades of Green from CICERO “to expand and strengthen our ability to help our customers seeking access to the sustainable debt markets,” said S&P Global’s Martina Cheung.
Environmental, social and governance, or ESG, debt issued by sovereign, municipal, corporate and financial sector entities has reached $4.5 trillion, up from $1.5 trillion just two years ago. Investors have been pushing ESG bond issuers for better disclosure of climate and other risks.
Shades of Green “provides transparency on climate risk while motivating early-movers in the market and rewarding advanced actors,” said Shades of Green’s Christa Clapp.