KPMG Launches New Guide for Green Bond Issuers

KPMG today published a paper aimed at helping private and public sector organizations to overcome challenges commonly experienced when issuing green bonds.

The paper – Gearing up for Green Bonds – is published as part of KPMG’s Sustainable Insight series. It addresses five key questions for issuers:

1. Should we label our bond ‘green’?

2. How do we define what makes the bond ‘green’?

3. What should we report on after issuing a green bond?

4. What type of external assessment should we seek?

5. How can we avoid accusations of ‘greenwash’?

The paper also provides readers with an overview of evolving green bond frameworks and standards including the Green Bond Principles, Climate Bonds Standard and green bond indices. It provides practical advice on defining a green bond, choosing the right level of external assessment and protecting the issuer’s reputation and the credibility of the green bond.

Adrian King, Global Head of Sustainability Services at KPMG, said, “The green bond market is growing rapidly with US$100 billion of issuances predicted for 2015. Perhaps inevitably in a new and fast-growing market, standards and ideas of best practice are still evolving. Challenges and confusion can arise as organizations assess whether issuing a green bond is the right course of action for them and seek to understand the process involved.

“KPMG member firms increasingly support clients on green bonds issuance in both advisory or assurance capacities. There are a number of questions that we are typically asked. We have addressed these in our new paper and hope this is a useful resource for any organization embarking on a green bond journey.”

Raajeev B Batra, Head of Climate Change and Sustainability, KPMG in India stated, "Green bonds are an attractive mechanism for organisations to raise capital for sustainable projects. These bonds can be raised by not only financial institutions, but also by any private sector or public sector organisations. The Government of India has ambitious plans to promote the renewable energy segment and the green bonds will play a significant role in realising the same. Overwhelming success of the first green bond issue by the Yes Bank demonstrates the market interest and a testimony of the investors commitment to being environmentally responsible."

Santhosh Jayaram, Director, Sustainability Advisory, KPMG in India said, “The global green bond market is growing rapidly which is a result of the interest from a varied debt investors. With this increasing demand it is also important to be cautious on the green label. This can be done by defining their green bond in line with the available guidance and investor expectations and also through an assurance of the use of proceeds”

KPMG member firms have provided advice and independent third-party assurance to some of the first organizations to issue green bonds across the world including clients in Australia, India and the UK. KPMG was the first major accountancy firm certified to provide green bond verification to the Climate Bonds Standard and member firms continue to play a role in the development of market standards and guidance.

Gearing up for Green Bonds: key considerations for bond issuers can be downloaded from www.kpmg.com/sustainableinsight.

About KPMG:

KPMG is a global network of professional firms providing Audit, Tax and Advisory services. We operate in 155 countries and have more than 162,000 people working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.