CLIMATE BONDS TAXONOMY
The Climate Bonds Taxonomy is the green definitions of the Climate Bond Standards and Certification Scheme. It is a public good resource that provides guidelines for prospective green bond and climate bond issuers and investors. The aim is to encourage common definitions across global markets, in a way that supports the growth of a cohesive thematic bond market. It identifies broad areas of inclusion (e.g. green residential mortgages, low emissions vehicles etc) that are subject to further criteria and screening.
Confidence in the green credentials of green bonds is essential to a sustainable market.
Transparency to the underlying asset is important in allowing investor due diligence. Credible, science-based, widely-supported guidelines about what should and should not be considered a qualifying investment helps investors make informed decisions about the environmental credentials of a bond.
The Climate Bonds Standard provides clear, sector-specific eligibility criteria for assets and projects that can be used for Climate Bonds and Green Bonds.
Certification is available for assets and projects that meet the requirements of the Climate Bond Standards. In order to receive the “Climate Bond Certified” stamp of approval, a prospective issuer of a Green or Climate Bond must appoint an approved 3rd party verifier, who will provide a verification statement that the bond meets the Climate Bond Standard. The Climate Bond Standard allows Certification of a bond prior to its issuance, enabling the issuer to use the Climate Bond Certification Mark in marketing efforts and investor roadshows. The Climate Bonds Standards Board (comprised of members representing $34 trillion of assets under management) confirms Climate Bond Certification once the bond has issued and the proceeds have been allocated to projects and assets.