Sustainable bonds: Focus on outcomes

Sustainable bonds issuance, yearly, USD billion
Source: Candriam, Bloomberg© - As at 15/12/2021

The Selection Challenge

In the past, sustainable investing in fixed income was mainly about issuers’ ESG credentials. Sustainable bonds changed that – by offering investors the ability to follow the use of bond proceeds, and monitor outcomes. But here is a challenge for investors – how do you account for bond objectives in your issue selection? Moreover, different types of sustainable bonds often have different types of objectives. While green bonds’ Key Performance Indicators (KPIs) can be quite precise and science-based, social projects tend to use a more subjective assessment criteria. So what should investors do?

May 2022

Bonds making impact: financing a sustainable future

Our white paper “Bonds making impact: financing a sustainable future” to explore some of the topical questions:

  • Returns and KPIs: what is more important in a sustainable bond and how are they linked?
  • Can these bonds be used for impact investing?
  • What to make of social and sustainability-linked (SLBs) - the two new types of bonds that followed their more established “green” peers?
  • Do SLBs present an alternative to sustainable bonds?
  • What role does the EU Taxonomy play in this market and why should we expect a new addition to these rules?
  • Governments have fallen in love with them – but how to analyse sustainable sovereign bonds?



Risks associated with investing in sustainable bonds include: Risk of loss of Capital, Credit Risk, Interest Rate Risk, Currency Risk, Liquidity Risk, Counterparty Risk and Derivatives Risk.

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