tbli conference™ nordic 2014 - green bonds - anne kvam - dnv gl
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DNV GL © 2014 SAFER, SMARTER, GREENER DNV GL © 2013
Green Bond Assurance
DNV GL
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DNV GL © 2014
Why get green bond verification
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As the green bond market continues to develop, the complexity of types of green bonds will cause challenges for specialist and mainstream asset managers in determining the sustainability credentials of individual issuances.
Assurance plays a vital part in providing independent verification of the accuracy and integrity of green bond information that investors are increasingly demanding.
As stated in the Green Bond Principles (GBP), “Attention will be paid to the accuracy and integrity of sustainability information and data whose disclosure is recommended by the GBP and which will be reported by issuers to stakeholders and used for strategic decision making by investors.”
The advantages of independent assurance include:
Reference clear and science-based definitions and criteria of what constitutes ‘green‘
Independent assurance of bond and associated reporting to investors
Demonstrate high standards of transparency and disclosure
DNV GL © 2014
Why DNV GL
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DNV GL’s core competence is to identify, assess, and advise on how to effectively manage risk. Our independence and integrity are our main strengths. With a global presence and a network of 500 offices in 100 different countries, our corporate objective is to safeguard life, property and the environment.
DNV GL has is an active participant in the Green Bonds space. We have supported pioneering issuances and have actively contributed to the development of current best practice.
Combining leading technical and operational expertise, risk methodology and in-depth industry knowledge, we ensure trust and confidence is achieved. We continuously invest in research and collaborative innovation to provide operational and technological foresight. We partner with our clients to find solutions that are bespoke, relevant, current, and answering to investor and stakeholder needs.
Globally trusted and valued for 150 years
150 World leader in non-financial assurance
A pioneer in green and sustainable bonds
Our independence and integrity
At the forefront of sustainability
DNV GL © 2014
Why our approach adds value
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Our verification process is founded on best practice and uses internationally recognised standards for assurance of non-financial data. In our verification statement and in our direct feedback to you, we provide constructive and valuable recommendations for improvement. The language used in our verification statements are clear and non-technical so as to ensure readers understand what is being stated.
A second party opinion provided by DNV GL will provide timely and qualified external assurance and integrity. Bond buyers are given additional reassurance about the use of funds. DNV GL’s green/sustainability bond assessment is a simple yet robust system for ascertaining whether funds raised via a given bond will go towards the financing of sustainable solutions. The criteria will be publicly presented and hence we ensure that what is being assessed is transparent.
Our assessment is not necessarily a certification against a standard, rather it is based on a bespoke protocol developed by DNV GL and adjusted to the needs of the issuer. DNV GL’s philosophy is to make the assessment as simple and transparent as possible, so that the issuer knows upfront what will be required.
In line with trusted standards and guidelines
Based on partnership and two-way dialogue
Simple and transparent
Flexibility and scalability
DNV GL © 2014
DNV GL Green Bond Opinion: A modular approach
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Our approach is modular: Some issuers may only need an opinion, while others require help developing criteria and screening projects as well.
Criteria Development Sustainability & Use of Proceeds
Asset/Project screening
2nd Party Opinion
Annual Verification
DNV GL © 2014
DNV GL’s relevant experience
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DNV GL © 2014
DNV GL – Selected Green Bond Experience
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Unilever Green Sustainability Bond
Hera Green Bond
Arise Green Senior Secured Bond
Arise Green Senior unsecured green Bond
Confidential – Asian Financial Institution Green Bond
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Unilever Green Sustainability Bond
Unilever Green Sustainability Bonds
Unilever was looking to issue a corporate “Green Sustainability Bond” to finance a selection of projects which demonstrate enhanced sustainability performance aligned with the purpose of Unilever’s Sustainable Living Plan.
Unilever commissioned DNV GL to advise on the creation of environmental and use-of-proceeds criteria and to provide a second party opinion on whether the bond has met the criteria established.
DNV GL developed an Environmental Protocol to establish suitable environmental criteria against which the nominated projects are reviewed prior to inclusion as an eligible project in the Green Sustainability Bond
portfolio. The environmental criteria were guided by Unilever’s vision to reduce its environmental impact and developed according to the targets established in the Unilever Sustainable Living Plan (USLP), and the Unilever Code of Business Principles.
Unilever successfully launched the green bond in March 2014, with value of £250M and a 2% fixed rate due 19 December 2018. It is the first green bond in the sterling market, and the first by a company in the FMCG sector.
Opinion
Contact on request
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Hera Green Bond
Hera Green Bond
Hera is a leading Italian energy utility. DNV GL verified its €500m green bond, which was the first on the Italian market.
DNV GL moreover supported in the criteria development and project selection of the bond. We used a multidisciplinary team of Italian, Norwegian, and UK based experts to develop the sustainability criteria to ensure a combination of worldwide expertise and Italian context.
Opinion
Contact on request
DNV GL © 2014
Arise Senior Secured Green Bond & Arise Senior Unsecured Green Bond
Arise Senior secured Green bond
DNV GL provided a Second Party Opinion on Arise AB’s SEK1.1bn bond to refinance 10 wind assets. Arise is one of the leading operators on the Nordic wind power market.
DNV GL’s work included developing a Framework, based on the Green Bond Principles, and verifying that the bond was in compliance with this Framework.
DNV GL’s work included working closely with Arise and the lead bank (DNB) in developing criteria, creating a Framework, verifying assets for inclusion in the bond, and issuing a Second Party Opinion for inclusion in the bond documentation.
Opinion
Contact on request
Swedish wind farm developer Arise is planning to issue an SEK350 million ($50.5 million) green bond in a deal that would see it refinance an existing bond.
This issue seeks to refinance a three-year senior, unsecured bond, which it issued in March 2012. The bond is not due to expire until 23 March 2015.
The planned bond would be labelled as ‘green’. DNV GL has provided a second-party opinion, based on the Green Bond Principles, which were launched in January. DNV GL has also assisted in the development of the sustainability criteria against which the bond was screened.
Although the proceeds are not traceable to specific projects, the bond is assessed as in-line with the spirit behind the Green Bond Principles, which is to ‘enable capital-raising and investment for new and existing projects with environmental benefits
Press Release
Contact on request
Senior unsecured Green bond
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Confidential green bond
Asian Financial Institution Green Bond
DNV GL is supporting a major Asian financial institution to issue its first labelled Green Bond. The Green Bond will be issued on the Euro market.
The bond seeks to refinance a range of assets that demonstrate enhanced sustainability performance. This includes both enhanced environmental as well as social performance.
DNV GL supported the development of sustainability criteria, as well as the use-of-proceeds criteria, and is currently working to verify the eligible assets against these criteria, upon which DNV GL seeks to issue an opinion whether the criteria have been met.
DNV GL © 2014
About DNV GL
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DNV GL © 2014 13
About DNV GL Driven by our purpose of safeguarding life, property and the environment, DNV GL enables organisations to advance the safety and sustainability of their business. With our origins stretching back to 1864, we are today a leading provider of services for managing risk, with a global presence of more than 500 offices in over 100 different countries. Our 16,000 professionals are dedicated to helping customers make the world safer, smarter and greener.
Combining leading technical and operational expertise, risk methodology and in-depth industry knowledge, we empower our customers’ decisions and actions with trust and confidence. We continuously invest in research and collaborative innovation to provide customers and society with operational and technological foresight. This means continuously developing new approaches to health, safety, quality and environmental management, so businesses can run smoothly in a world full of surprises
DNV GL © 2014
DNV GL: Safeguarding Life, Property, and the Environment
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Our Purpose
To safeguard life, property, and the environment Our Vision
Global impact for a safe and sustainable future Our Values
• We build trust and confidence • We never compromise on quality or integrity • We are committed to teamwork and innovation • We care for our customers and each other • We embrace change and deliver results
16,000 Professionals
100 Countries
532 Offices Globally
NOK 15 bn 2013 revenues
1864 Year founded
Oslo Head office
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DNV GL’s Business Areas
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DNV GL © 2014
External Recognition: A world leader in assurance and verification
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Selected Awards Selected certifications and partnerships
Among the world’s top suppliers of sustainability assurance services 2014.
• Best Verification Company EU ETS • Best Verification Company Kyoto Project Credits (JI &
CDM)
Risk consultancy of the year 2014
DNV GL © 2014
SAFER, SMARTER, GREENER
www.dnvgl.com
TRUST AND CONFIDENCE For over 150 years
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Pernille Holtedahl [email protected] +44 (0)79 0339 0627
Douglas Farquhar [email protected] +44 (0)77 7133 9549
Youri Lie [email protected] +44 (0)79 1719 1559
Anne Kvam [email protected] +47 97 12 17 98