SGX launches initiative to recognise sustainable fixed income
On 28 November 2022, Singapore Exchange (“SGX”) launched the SGX Sustainable Fixed Income initiative. The new initiative identifies fixed income securities listed on Singapore Exchange Securities Trading Limited (“SGX-ST”) that meet recognised standards for green, social and sustainability (“GSS”) fixed income securities.
Eligibility criteria
Wholesale and retail fixed income securities listed on SGX-ST can be recognised under the SGX Sustainable Fixed Income initiative if they meet the following criteria at issuance:
- Alignment with recognised green, social or sustainability standards for fixed income securities (“Recognised Standards”).
- Confirmation by an external reviewer that the fixed income securities are aligned with the Recognised Standards. The external reviewer should be a reputable firm with an established track record of providing similar reviews.
- Publicly available reports setting out the fixed income securities’ alignment with the Recognised Standards.
To maintain recognition under the SGX Sustainable Fixed Income initiative, issuers must publish any post-issuance reports such as the annual report, as required under the applicable Recognised Standard, as well as information on any material developments which may affect alignment with the Recognised Standards. Such reports and information must be made publicly available.
Benefits
The list of fixed income securities recognised under the SGX Sustainable Fixed Income initiative is published on the SGX website and on Greennode, a GSS bond information hub operated by Marketnode.
Issuers can use the recognition to demonstrate their commitment to the Recognised Standards, and to raise their visibility and profile with investors that are interested in sustainable fixed income. They can also upload sustainability-related reports and other documentation through SGXNet to inform investors of their sustainable finance strategy.
The recognition will also benefit investors by enabling them to easily identify sustainable fixed income securities and to access sustainability-related information. In addition, the criteria that SGX imposes provide investors with assurance that the GSS fixed income securities recognised under the SGX Sustainable Fixed Income initiative have been independently verified for alignment with the Recognised Standards.
Application process
Recognition under the SGX Sustainable Fixed Income initiative will be granted by SGX on an application basis.
- Step 1 - Apply for listing: Issuers of GSS fixed income securities can apply for recognition under the SGX Sustainable Fixed Income initiative together with their application to list and quote fixed income securities on SGX-ST. The prevailing listing fees applies and there is no additional fee for the application for recognition.
- Step 2 - Review and approval: SGX will concurrently review the application for listing and that for the recognition under the SGX Sustainable Fixed Income initiative. For wholesale fixed income securities, the existing processing time for listing applications of one business day will remain unchanged. Approval-in-principle for the listing application and the recognition will be granted concurrently.
- Step 3 - Listing of fixed income securities: Issuers can then complete the listing of their GSS fixed income securities in accordance with existing listing workflows. The fixed income securities will be recognised under the SGX Sustainable Fixed Income initiative at the point of listing and will be added to the list of recognised fixed income securities on the SGX website and on Greennode shortly afterwards. Issuers may use an SGX Sustainable Fixed Income mark in their marketing materials for the GSS fixed income securities awarded the recognition. Issuers may request for the official mark by email to SGX.
- Step 4 - Ongoing reporting requirements: Post issuance, to maintain recognition under the SGX Sustainable Fixed Income initiative, issuers must publish reports required under the applicable Recognised Standard. These reports must be available without charge and can be published on SGXNet or on the issuer’s website.
Reference materials
The following materials are available on the SGX website www.sgx.com:
