In September 2020, the first sustainability-linked bond (SLB) aligned with ICMA’s Sustainability-Linked Bond Principles (SLBPs) was issued, and many other SLBs have followed since. Issuers of SLBs represent an array of different sectors, which is a testament to the innovative instrument’s broad appeal.
Following the SLBPs, issuers should report on their key performance indicators (KPI) monitoring and the progress made towards the ambitious Sustainability Performance Targets (SPTs) they committed to at issuance.
As SLB issuers prepare to publish their first reports, we look at how the SLB market is developing, what industries are driving its growth and how investors are responding. What do the first SLB reports indicate about progress made by SLB issuers so far and can this new instrument truly deliver on its sustainability promise?