Version 3.0 of the Climate Bonds Standard was published in December 2019. The document is the foundation of Climate Bonds certification and the revision is part of a larger development program of the Climate Bonds Initiative. With this important update, the Climate Bonds Initiative is ensuring that the standard provides all-encompassing guidance on Climate Bonds certification. Find out exactly what the goals of the revision are and what changed requirements will result below.
Launched in 2013, the Climate Bonds Initiative is a nonprofit organization aimed at investors that promotes large-scale investments in a low-carbon economy. It is aligned with the goals of the Paris Agreement and accordingly promotes investments that help limit global warming to two degrees. All basic information on the Climate Bonds Standard can be found here.
What changes in version 3.0?
The new version includes detailed requirements for issuers on what a Green Bond Framework document must contain. In addition, the requirements are more clearly defined in version 3.0. An annual update report is now required that includes deployment, suitability, and impact. Climate Bonds Standard V3 includes detailed definitions of the assets supported by the standard and an expansion of the list of debt instruments that can be certified. This now includes loans, sukuk bonds, deposit products and other investments.
Version 3.0 gives issuers and investors confidence that certified green bonds meet the regulatory requirements of major jurisdictions. The revision is compatible with the new EU Green Bond Standard (EU GBS) and Green Bonds Principles (GBP). This means that certified Climate Bonds also meet the requirements of the GBP and EU GBS. In addition, the revision is compatible with the EU Taxonomy and other market developments including guidelines adopted by India, ASEAN (Association of Southeast Asian Nations) and Japan.
The revision is part of an ongoing development program that affects the entire Climate Bonds Initiative. This includes the update of the Climate Bonds Green Taxonomy in October 2019. You can view the new version here.
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