After having first defined a climate bond framework in 2017, in 2020, the AFD Group prepared an issuance Framework that is aligned with Sustainable Development Goals (SDGs). This Framework was prepared in accordance with the International Capital Market Association’s (ICMA) Green Bond Principles, Social Bond Principles and Sustainability Bond Guidelines. Thus, for each SDG Bond issuance, AFD commits to complying with the following four fundamental principles: use of proceeds; process for project evaluation and selection; management of proceeds; reporting.
The SDG Bond Framework was reviewed by Vigeo, which awarded it an “Advanced” rating and qualified the Framework as being in line with “best practices”. Under the SDG Bond Framework, the AFD Group may issue SDG bonds (“SDG Bonds”) in various formats:
- Climate bonds (100% of the proceeds raised are allocated to “climate” categories in keeping with the AFD’s previous Climate Bond Framework)
- Social bonds (100% of the proceeds raised are allocated exclusively to social categories in accordance with the Social Bond Principles)
- Sustainable bonds (100% of the proceeds raised are allocated to the eligible categories defined in the Green Bond Principles and/or the Social Bond Principles).