SLBs Fall Short of Climate Targets
(13 November 2023 - Australia) Corporate issuers are increasingly turning to labelled sustainability linked bonds (SLBs), issuing more sustainable-debt instruments than supranationals, sovereigns and agencies in 2023.
SLBs are more likely to achieve emissions reductions targets than use of proceeds bonds, but many labelled bond users are not tracking to meet 2050 net zero targets.
MSCI ESG Ratings identified 931 companies with outstanding labelled bonds in the last three years, comparing them to 3,437 corporate-bond issuers without such labels, finding almost 40 percent of labelled-bond issuers either had science-based targets or were committed to work on science-based targets, double the proportion among the other issuers.
"There is no shortage of money to fund the energy transition but there is an express need for a coherent plan to coordinate the various global taxonomies, regulations, disclosures, standards, and targets which would support a less complex and more efficient and effective transition" commented ANZ CEO, Shayne Elliott.
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