As the U.S. member body to the International Organization for Standardization (ISO), the American National Standards Institute (ANSI) encourages its members and relevant stakeholders to comment on an ISO new work item proposal focused on the green bond market by close of business (COB) on July 26, 2017.
The proposal explains that standardization work in the area of "Green bonds - Environmental performance of nominated projects and assets" will harmonize multiple definitions of green bonds, specify requirements for nominating projects and assets for funding; specify eligibility, use of proceeds, and disclosure requirements; and describe assurance options.
Green Bond Market Growth
As growth in the green bond market continues, stakeholders are calling for greater clarity surrounding "do-good debt," where proceeds are used to fund green investments and environmentally friendly projects. In 2016 alone, the issuance of green bonds doubled over the previous year, with a projected $150 billion to be issued in 2017.
However, there is no single definition of a green bond, which can cause confusion in the marketplace. Some socially responsible investors are also concerned about "greenwashing" - where financed projects are mislabeled as "green" or "sustainable" when in fact, they return few if any environmental benefits. In response to these challenges, a number of efforts to harmonize the assessment of green bonds have been proposed, including this latest new work item proposal from ISO.
The publication of an ISO standard could boost confidence in the environmental benefits of funded projects. ISO Technical Committee (TC) 207, Environmental management, Subcommittee (SC) 4, Environmental performance evaluation, has prepared a new work item proposal that could be submitted for a vote by ISO members in the coming months. ISO TC 207/SC 4 is under U.S. leadership; ANSI has delegated the secretariat of this subcommittee to the American Society for Quality (ASQ), and Dr. John Shideler, climate services manager at NSF International, serves as chairperson of the SC.
Dr. Shideler encourages member bodies to identify experts from issuer, investor, underwriting, regulatory, assurance and NGO communities for this standards writing effort. To be added to a list to receive updates on this proposed new standard please visit: https://goo.gl/fqUbHA.
Interested parties are invited to review the proposal and submit comments to Julie Sharp, administrator of the ANSI-accredited U.S. Technical Advisory Group (TAG) to ISO TC 207/SC by July 26 ([email protected]).