The GAW equips issuers with a platform to demonstrate credibility, high impact investment opportunities and efficient reporting of said impacts to global investors. It both offers a system for validation of delivery on commitments, as well as a structured way for impact reporting. The GAW aims at cutting costs for issuers (supply side) and enable new issuers to demonstrate credibility and high impact investment opportunities. In particular, the GAW focuses on lowering the thresholds for new issuers in emerging markets where the need for sustainable infrastructure high. The emerging market issuers we have engaged with have all welcomed the solutions that the GAW can provide. In the words of one GAW pilot issuer:
To log in as an issuer to the Green Assets Wallet, click the following button;
Issuer User Guide
The issuer interface has three main tabs:
Green Bond Profile
Green Bond Profile
Issuers create new frameworks using the tab Create Framework. Bear in mind that the "framework" is an abstraction of the various different ways in which issuers describe the rules that govern their green bonds. It is inspired by the Green Bond Framework, but if you use a different system, it can be adopted to this template.
Your existing framework name, if you have one, can be added here. If not, you could opt for "Organisation name framework", or take the opportunity to communicate something more about the purpose of your capital raise.
Use of Proceeds categories
Please choose one or multiple use of proceeds categories that is related to your framework. The Green Assets Wallet applies the Use of Proceeds project categories defined by the International Capital Market Association’s (ICMA) Green Bond Principles.
UN Sustainable Development Goals (SDGs)
This field is not mandatory but it is highly recommended to choose one or multiple SDGs that apply to your framework since in future versions of the GAW investors could be able to search for investment opportunities through SDGs. In the following report by International Capital Market Association you can read more and see how the Green Bond Principles’ Use of Proceeds Categories can be mapped against the SDGs;"Green and Social Bonds: A High-Level Mapping to the Sustainable Development Goals" (https://www.icmagroup.org/green-social-and-sustainability-bonds/mapping-to-the-sustainable-development-goals/).
Green Commitments refer to the most important “promises” that the Issuer makes to investors regarding what the proceeds raised will be used for. The commitments are often a summary of the;
intended use of proceeds
eligibility criteria, and
reporting obligations expressed in the Green Bond Framework (or similar documents).
The commitments stated here is what the Issuer is expected to follow-up and provide transparency on during/after project implementation through the Green Assets Wallet. The Commitments made here, at framework level, can be validated at project level.
For commitments to be useful for validation, there are some guidelines that you should adhere to when uploading them to the GAW;
1. A commitment should refer to one thing only. That means that you should ideally be able to provide an evidence point which supports the entire content of the commitment in question. For example, the commitment "all projects will achieve an energy performance of 100kWh/m2 or less" is useful, because you can provide evidence in the form of an energy report or audit which demonstrates that the commitment has been fulfilled. In contrast, the commitment "all projects will achieve an energy performance of 100kWh/m2 or less with over 90% of energy supplied coming from renewable sources" is a little more ambiguous. It is possible that a single piece of evidence could support both of those criteria, but also possible that it only supports one. Better to instead create two distinct commitments: "all projects will achieve an energy performance of 100kWh/m2 or less" AND "at least 90% of energy supplied to all projects will come from renewable sources".
2. Similarly, if commitments are to be used for validation, they should be phrased in a way that is verifiable. Think of it as formulating a scientific hypothesis that you will subsequently attempt to "prove".
3. The phrasing should be as clear, concise, and unambiguous as possible.
Use of Proceeds
The Green Assets Wallet applies the Use of Proceeds project categories defined by the International Capital Market Association’s (ICMA) Green Bond Principles.
Sustainable Development Goals
What SDGs are relevant to your Green Bond Framework, projects and the proceeds raised? In the following report by International Capital Market Association you can read more and see how the Green Bond Principles’ Use of Proceeds Categories can be mapped against the SDGs: "Green and Social Bonds: A High-Level Mapping to the Sustainable Development Goals"
Why are you issuing green debt? On the Green Bond Profile it is possible to highlight the main purpose of issuing the green debt instrument (there is a separate section further down to describe Use of Proceeds in more detail, so keep this at an overarching and strategic level).
This is where you enter data about the bonds that you have issued, so that investors can construct portfolios of bonds and aggregate statistics that relate to their holdings. If you issue other type of green debt, this tab does not need to be filled in.
After you have decided to allocate funding to a project, a project entity in GAW should be created. This is where you create project profiles where impact reporting and validation take place.
Project Description: What should I write here?
This is where you describe a specific project which is wholly or partially financed by the bond (or loan). Summarize the objective of the project, activities undertaken/planned to achieve the objective, potential project partners and potential co-funding could be mentioned here as well.
Do I have to submit project information?
Every issuer is unique and every issuer decides what information that best serves their investment offering. As such, the level of detail of the green debt investment presented on the Green Assets Wallet will differ between issuers. Some issuers will choose to present a selection of projects, while others present all projects. This all depends on what best serves the investment offering.
Impact report creation
Once a project is created, issuers can report the projects’ yearly impact. Impact reports currently cover three indicators: energy performance, energy generation, and emission avoidance. There is also an option to add a "Custom report form" where any impact that the project might have can be reported. Bear in mind that you should add one impact report only for each unit per year per project. Documentation should be included and details of where the information has been derived from, calculations behind the metrics or any other useful context. Aggregated impact (in terms of emissions avoidance and renewable energy generation) from all projects is aggregated and presented on the issuer profile together with statistics of what percentage of projects that has reported impact in the GAW.
Please visit this page for detailed description of impact reporting.
Validation report creation
Validation reports are created in two steps, first an issuer creates the form for the validation information, then select a "validator" that is registered in the GAW to provide the information that the issuer specify. The issuer can browse for suitable validators, or if you have a preferred third party verifier already, you can suggest that they apply for a GAW account so your verification can move to the next level (please visit Validator guide for more information). After the commitment to be validated is chosen and directed to the selected validator, the process is simple. For example, if you wanted to provide evidence of the construction of a large-scale solar plant in a remote area, you could use a validator who specialises in collecting and analysing satellite imagery.
Identify the commitment to be verified (e.g. "A large scale (10MW+) solar installation will be built in X region")
Identify the evidence that you believe will be convincing and practical to provide ("sequential satellite images over three years of the site at GPS coordinates x")
Identify the validator who you think will provide the evidence, ideally approach them first to check that they are able and willing
Create a form with a file upload slot ready to receive the images in question.
Submit your report, and you are ready to be validated. Your investors know they can expect satellite verification in the future, your validator can provide it as soon as they are ready to do so, and your investors know the moment their expectations have been fulfilled.
Together, you and your validators build a track record of credible activity over time (developing a track record function is a high priority in 2019), leading to greater trust and more investment.