Climate, Energy and Sustainable Finance

Workshop on green bonds attracts companies and investors

Posted in 15/12/2016

Photograph: speakers and organizing teams from CEBDS, GIZ and SEB

The structuring of the green bond market, or green bonds, in Brazil was the central theme of the two workshops promoted this Tuesday (13) and Wednesday (14) by the Brazilian Business Council for Sustainable Development (CEBDS) in partnership with German Agency for International Cooperation (GIZ) and the Bank Skandinaviska Enskilda (SEB). The event, held in São Paulo, was attended by around 90 representatives from companies, the financial market, the public sector and universities.

The workshops were based on three pillars – definitions, selection and verification – presented by regional and international finance and climate experts. After the technical and conceptual discussion, the speakers explained their experiences in the roles of issuer, investor and multilateral financial institution.

On the second day, the public was invited to participate in a practical exercise that consisted of evaluating the quality and transparency of the framework of green bond issuances made by Apple and MuniFin, lending institution for local governments in Finland.

“The issuance of green bonds helps the company comply with the Principles for Responsible Investment (PRI), an initiative led by the UN that brings together half of the resources of all global investors”, said Mats Olausson, senior consultant for Financial Solutions for Climate and Sustainability at SEB.

He highlighted the importance of adapting the guidelines and recommendations for issuing green bonds to the reality of each country, in addition to addressing the opportunities that open up for companies. “Green bonds are a chance to connect experts in sustainability and finance, integrating processes within companies and institutions in defining which projects will be eligible as green bond“, he explained.

Tess Olsen-Rong, from Affirmative Investment Management, spoke about the investors' vision in this process. “Our concern is with the impact of investments. Therefore, it is expected from issuers of green bonds that make periodic disclosures detailing how the emissions were carried out”, he concluded.

Guilherme Hirata, executive manager of Corporate Finance at Suzano Pulp and Paper, the first company to issue green bonds in the Brazilian market, commented on this experience. “Investors seeking green bonds are growing rapidly around the world and having the seal green It has been facilitating access to credit, in addition to having a very strong reputational appeal. The additional costs of issuing a bond with the green seal are marginal compared to the increase in the investor base and having prior certifications helped a lot to speed up the process, which lasted just 35 days”, he highlighted.

With the emissions, Suzano will finance 3 projects in the company's forestry area: sustainable forestry, forest recovery and biodiversity preservation. In addition, three other projects in the industrial area will be funded: energy efficiency, renewable energy and water resources management.

Luciano Scheizer, specialist in the Capital Markets and Financial Institutions Division of the Inter-American Development Bank (IDB), discussed the institution's role in the transition to a low-carbon economy. “The IDB’s main goals are to address climate change and support the development of renewable energy and environmental sustainability. To this end, we are committed to dedicating 30% from our investment portfolio to combating climate change,” he emphasized.

For Fernando Servidone Magri from CPFL Energia's Sustainability Management, the workshop was very enlightening "the event showed all the stages of issuing green bonds and the responsibilities of each actor in the process, in addition, it was important to know in detail the process of" Second Opinion” and expectations from the investors’ perspective”, states Magri.

O Guide for Issuing Green Bonds, prepared by CEBDS in partnership with Febraban, was presented during the workshop. Harald Franck, from Center for International Climate and Environmental Research (CICERO), highlighted that this is an important instrument for consolidating the green bonds in Brazil. “The CEBDS guide makes the work of issuers much easier”, he highlighted.

The coordinator of the CEBDS Thematic Chambers on Climate Change and Energy and Sustainable Finance, Lilia Caiado, highlighted the exchange of experiences provided by the event. “The workshop was very productive and fulfilled its objective of integrating the business, public and financial sectors around the topic of green bonds, presenting everything from technical challenges to the practice of issuing bonds. This exchange is essential for us to continue advancing in the consolidation of a national market for green bonds“, he stressed.

Strategic Alliance

O workshop on Green Bonds is the result of a partnership between CEBDS and Strategic Alliance, formed by GIZ and SEB. The objective of the initiative is to develop the green bond market in emerging G20 economies, aiming for the transition to a low-carbon economy and alignment with G20 prerogatives. Paris Agreement and of Sustainable Development Goals (SDGs).

In order to promote transparency and environmental integrity of standards and procedures, which are crucial for long-term sustainable development at this still nascent stage of the market, GIZ and SEB have been offering, among other things, workshops themes about green bonds to all interested groups.

Check out the presentations:

Workshop December 13