The International Finance Corporation (IFC), a member of the World Bank Group, together with the International Capital Market Association (ICMA), United Nations Global Compact (UN Global Compact), United Nations Environment Programme Finance Initiative (UNEP FI), and the Asian Development Bank (ADB) have developed a global practitioner's guide for bonds to finance the sustainable blue economy.
Released today, the voluntary guidance provides market participants with clear criteria, practices, and examples for “blue bond” lending and issuances. Gathering input from the financial markets, ocean industry and global institutions, it provides information on the key components involved in launching a credible “blue bond,” how to evaluate the environmental impact of “blue bond” investments; and the steps needed to facilitate transactions that preserve the integrity of the market.
The new global guidance helps:
• Suggest key performance indicators;
• Showcase latest case studies from the field; and
• Highlight the critical need for increased financing to achieve Sustainable Development Goal 14, and other global sustainability targets.
The development of a sustainable blue economy, including preventing the decline of marine fisheries, the expansion of low-carbon aquaculture, the scaling of offshore renewable energy and the decarbonization of maritime transport is integral to tackling the triple planetary crisis of a rapidly changing climate, nature loss and pollution. The ocean serves as a vital heat and carbon sink, absorbing about 31% of the carbon dioxide emissions released and regulating the global climate.
The transition to a sustainable blue economy is instrumental to achieving the goals of the Paris Agreement, with 20% of the reduction in GHG emissions that need to take place in blue economy sectors.
UN Global Compact: "A healthy ocean is not only a vital carbon sink and home to 80% of all life on earth, it can also be a source of innovation to improve climate, nature and livelihoods. Blue bonds are a crucial instrument to deliver financing for marine-based solutions such as clean energy; transport and food systems. This guidance is an important step towards providing the global market with direction and consistency to support investment in a thriving sustainable blue economy which benefits everyone," said Sanda Ojiambo, CEO and Executive Director, UN Global Compact.