Initiative of the year - Sustainability Bond - World Bank

Channels: Green Bonds

The World Bank's Sovereign ESG Data Portal was launched in October to help investors better conduct their own analysis of sovereign bonds on environmental, social and governance (ESG) criteria.

Heike Reichelt It also aims to increase data transparency and support private sector investments in emerging markets and developing countries.

The portal uses World Bank data, and applies 67 'indicators' which the institution judged the most relevant for ESG investors.

It is comprised of 17 ESG themes, which were selected to provide a balanced picture of policy performance and country conditions. The data is available for download for all 189 World Bank (International Bank for Reconstruction and Development and International Development Association) countries.

The portal allows investors to easily dig into the underlying indicators, rather than relying just on the analysis of ESG data providers.
New indicators, including from geo-spatial and big data sources, on natural capital, human capital, poverty measures, stranded assets and other areas, are set to be developed and added to the portal in the future.

The portal was based on a market consultation by the World Bank and a group of investors and ESG research firms, to identify gaps in data availability and access.

Japan's Government Pension Investment Fund (GPIF) – the world's largest pension fund by assets – was among investors that partnered with the World Bank to develop the portal.

Hiro Mizuno, executive managing director and chief investment officer at the pension fund, said: "GPIF trusts this data portal will improve and enhance the quality of investment decisions of our asset managers."

Heike Reichelt, head of investor relations and new products at the World Bank, said: "Labelled bonds such as green, social and sustainable bonds have sparked a change in issuer and investor behaviour that has transformed capital markets towards more transparency on use of proceeds, focus on ESG and reporting on impact.

“We’ve seen a massive change in issuer and investor behavior in the fixed income capital markets that has been sparked by green bonds introduced over ten years ago. Capital markets are being transformed towards more transparency on use of proceeds, focus on ESG and reporting on impact. Investors are now increasingly taking a holistic approach and asking issuers about the impact of all their activities, including how they contribute to the SDGs.

"The World Bank’s Sustainable Development Bonds engage investors on the SDGs and support them in broadening their focus. With initiatives such as the World Bank’s Sovereign ESG data portal and our collaboration with partners to build sustainable capital markets, we are making a contribution that goes beyond our own issuance to advance both the use and understanding of ESG data to channel more capital to sustainable development."