The SGX Sustainable Fixed Income initiative allows investors to easily identify investments that meet certain criteria at issuance. These parameters are:
- Compliance with recognized green, social or sustainable standards for fixed income securities. The list of recognized standards is shown here.
- Confirmation by an external auditor that the fixed income securities meet recognized standards. The appraiser must be a reputable company with an established track record of providing similar reviews; and
- Publicly published reports demonstrating the compliance of fixed income securities with recognized standards.
Issuers can use an SGX Fixed Income index to identify trusts that meet these requirements.
In order to be recognized under the SGX Sustainable Income initiative, the issuer must submit any post-issuance reports such as the annual report, as required by the applicable recognition standard, as well as information on any material developments that may affect the Publish compliance with recognized standards. . Such reports and information should be disclosed to the public. Information on fixed income securities recognized under the SGX Fixed Income initiative is published on the SGX Group website here and on Marketnode.1.
“The goal of financial innovation should be to provide real-life solutions. SGX’s Fixed Income Initiative allows investors to easily identify fixed income securities that can be issued to identify sustainable projects that meet market expectations. Investors will benefit to know that these bonds have been independently audited for compliance with recognized standards. Sustainable investing is growing and SGX Group anticipates that such assurance may be helpful for other asset classes,” said Tan. Boon Gin, CEO of Singapore Exchange Regulation (SGX RegCo).
Issuers applying to list and quote fixed income securities on the SGX securities market may also submit an application for recognition under SGX’s Sustainable Fixed Income initiative. SGX RegCo will consider both applications together.
“This recognition will help SGX’s Fixed Income products stand out among the nearly 6,000 bonds listed on SGX at any given time. Issuers can use the recognition to demonstrate their commitment to these well-understood standards and find and raise its profile to investors interested in sustainable fixed income securities,” said Lee Beng Hong, Head of Fixed Income, Commodities and Currencies, SGX Group.
SGX RegCo estimates that approximately 200 of the SGX-listed fixed income securities already meet SGX’s ongoing Fixed Income criteria and they will be implemented over the next few months.
- Marketnode, a joint venture of SGX Group and Temasek, is a digital markets infrastructure provider.