Sustainaweekly - Social taxonomy taking shape
In our latest edition of the Sustainaweekly, we start by discussing the sixth IPCC report, which warns the extent and magnitude of climate change impacts are larger than previously estimated. In addition, these adverse impacts and related losses and damages escalate with every increment of global warming. Furthermore, as there was limited issuance over the last few days, we then move to take a closer look at the news that the BIS has launched a third green bond fund. Last but certainly not least, we report on the contours of a social taxonomy taking shape. Although the timelines of next steps are unclear, they could not come soon enough. The current annual average funding gap towards social objectives – at USD 2.5 trillion – is partly due to the lack of a clear definition of what a social investment entails. Enjoy the read and, as always, let us know if you have any feedback!
Economics Theme
The sixth IPCC report finds that the extent and magnitude of climate change impacts are larger than previously estimated. Risks and impact start to become broadly elevated at a global warming level in excess of 2°C, while in the case of unique ecosystems and extreme weather events, impacts become elevated even at 1.5°C.
ESG Bonds
The BIS launched its third green bond fund. It will target projects in Asia and the Pacific. Its first fund was a USD-denominated fund, while the second focussed on EUR-denominated assets. Assets under management of the three funds are expected to eventually reach USD 3.5bn.
Policy and Regulation
The Platform on Sustainable Finance released its final recommendation report on the development of a social taxonomy. The new version aligns to the extent possible to the structure of the existing EU Taxonomy. The European Commission will review the report and evaluate the next steps but there are no timelines.
ESG in figures
In a regular section of our weekly, we present a chart book on some of the key indicators for ESG financing and the energy transition.