World Bank Offers New Sustainable Growth Bonds for Investors in Switzerland
The World Bank (International Bank for Reconstruction and Development, IBRD, Aaa/AAA) has launched a new series of bonds in Switzerland that directly link investors to the Sustainable Development Goals (SDGs). Returns are linked to the performance of companies advancing global development priorities set out in the SDGs, including climate, gender, and health.
Banque SYZ SA is the sole distributor of the notes. The World Bank will use the proceeds to support the financing of projects that advance its goals of eliminating extreme poverty and boosting shared prosperity, and that are aligned with the SDGs.
The return on investment in the bonds is directly linked to the stock performance of companies included in the Solactive Sustainable Development Goals World MV Index. The index includes 30 companies that, based on the methodology developed by Vigeo Eiris’ Equitics, dedicate at least one fifth of their activities to sustainable products, or are recognized leaders in their industries on socially and environmentally sustainable issues. Solactive applies volatility and diversification filters to reach the final index composition. Vigeo Eiris is a global provider of environmental, social and governance research to investors and public and private corporates.
The bonds are arranged by BNP Paribas as part of the “SDGs Everyone” initiative. Under the initiative, the World Bank issues bonds to support the financing of projects that support the SDGs, and investors benefit from the performance of companies included in the equity index.
This offering follows up on previous offerings of World Bank Sustainable Growth bonds in partnership with Banque Syz.
Achieving the Sustainable Development Goals requires a fundamental shift in development finance – the active participation of private investors is key to this change. Thanks to our deepening partnership with Banque SYZ and BNP Paribas who arranged the bond, Swiss private investors will have a new opportunity to participate in a product that demonstrates the powerful role of capital markets in connecting savings with development priorities.”
The economic impact of climate change is massive: it affects direct assets, damages future returns and endangers fragile economies. If the awareness to shift to low-carbon emissions is widely accepted, we need to address solutions that protect our investors’ capital and take advantage of both existing and new opportunities,” says Eric Syz, CEO of SYZ Group.
“Therefore, we are very proud to partner again with the World Bank through their investment solution supporting the Sustainable Development Goals. Innovation is one of our core values and as a responsible investor we are pleased to contribute to new solutions creating performance through investments that incorporate environmental, social and governance considerations”.
Olivier Osty, Head of Global Markets, BNP Paribas, said: “We are pleased to be working with the World Bank once again, as it renews its successful programme of Sustainable Growth Bonds issuance into Switzerland. Now more than ever, there is growing urgency to put private sector capital to work in development projects. Sustainability is core to our strategy at BNP Paribas and we are committed to supporting our clients in working together to achieve the SDGs.”
Source: World Bank
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