Banking giant HSBC has announced plans to invest $1bn through bond markets to boost its investments in renewable energy, clean transport and other projects designed to tackle climate change.
HSBC announced late last week that it would commit to lend a total of $1bn to companies, cities and multilateral banks that are seeking to raise finance for projects that tackle climate change.
The bank said it would only invest in projects issued under federal Green Bond Principles, which aim to assure investors money raised will be put towards verified climate themed investments. The funds will also provide financing for small and medium-sized businesses in sectors such as public transport, education and healthcare, it said.
Spencer Lake, global head of HSBC capital financing, said the bank was committed to growing the green bond market.
“HSBC understands that action to support the transition to a low carbon economy also brings social and economic benefits,” he said in a statement. “We are building our business for the long term and over the last 10 years HSBC has developed its approach to climate change. The bank integrates climate policy, insight and education into the Group’s global businesses and operations.
“Sustainability underpins our strategic priorities and enables us to fulfil our purpose as an international bank and this is yet another commitment to evolving our sustainable business.”
Green bonds issuance in 2015 is expected to reach $60bn to $70bn, according to the Climate Bonds Initiative, up from just $8bn in 2007. The green bond market has expanded in recent years, attracting a more diverse range of issuers including banks, cities and corporates alongside the traditional multilateral development banks.
On Thursday, consultancy EY became the latest partner of the Climate Bonds Initiative as part of its efforts to set clear standards for the emerging market. “EY recognises that capital markets investment will be essential to finance the green growth we need to avert catastrophic climate change,” said Matthew Bell, Oceania leader for climate change and sustainability services at EY.
“We need to see the development of transparent, repeatable, and verifiable mechanisms to support the market, and to support confidence in green outcomes. The Climate Bonds Standards and Certification scheme is one of these.”
Source: HSBC pledges to invest $1bn in tackling climate change – 16 Nov 2015 – News from BusinessGreen
