IDB Invest Publishes First Sustainable Bond Allocation and Impact Report

Published on: 04 October 2022
by KnowESG

According to its inaugural Sustainable Bond Allocation and Impact Report, IDB Invest completed its $1.6 billion funding programme for 2021 by issuing entirely sustainable bonds under its Sustainable Debt Framework.

The programme consisted of $1 billion in sustainability bonds, $424 million in social bonds, and $186 million in green bonds to support green and inclusive private sector projects throughout Latin America and the Caribbean. Among these are Mexico’s first gender bond, issued by a supranational issuer, and the first blue bond issued in the region.

James Scriven, CEO of IDB Invest, said: 

"We are committed to investing in sustainability and walking the talk as a leading sustainable issuer. Investors want to know the development impact actually achieved through their ESG investments. We are on track to delivering these results through this inaugural report.”

The report gives bond investors the information they need to evaluate the impact of their investment. It contains information about IDB Invest's sustainable bonds, as well as information about the projects funded using bond proceeds, such as impact indicators and case studies of eligible projects. 

Sustainalytics certified the report's compliance with the use of proceeds criteria and reporting commitments in IDB Invest's Sustainable Debt Framework through an independent evaluation.

The proceeds of the $1.6 billion sustainable bonds issued in 2021 were allocated to 54 projects by IDB Invest, with the majority of the funding going to projects in the categories of Socioeconomic Advancement and Empowerment ($799 million), Renewable Energy ($387 million), and Employment Generation ($257 million). 

Over 2.5 billion tonnes of emissions were reduced, 570,959 small and medium-sized firms (SMEs) were financed, 5.3 million MWh of renewable energy was generated, and 413,551 loans were issued to women-led SMEs.

Sustainable investments have risen dramatically in recent years, with global ESG investments anticipated to reach $50 trillion by 2025, up from around $35 trillion in 2020. Green, social, and sustainable bonds have more than doubled throughout Latin America and the Caribbean in two years, with market size of $48.6 billion. The Paris Agreement's overall long-term decarbonisation goals have fueled momentum.

The report represents an important milestone for IDB Invest as a component of its Sustainable Debt Framework. 

This framework, which was established last year, enables IDB Invest to issue green, social, and sustainability bonds, as well as expand its offering as a supranational bond issuer with thematic bonds that best match its overall approach to impact and ESG. It is consistent with the International Capital Market Association's Green Bond Principles and Social Bond Principles.

Source: IDB Invest

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