Green sovereign bond investment contributes to Swedish climate ambitions

Green sovereign bond investment contributes to Swedish climate ambitions

Published on: 2 September 2020

APG has invested 25 million in the first green Swedish sovereign bond on behalf of its pension fund clients. Sweden will use the proceeds to finance measures that contribute to its ambition for a carbon neutral economy in 2045.

 

Green bonds are issued by companies and (semi-)government agencies for the funding of sustainable projects. The Swedish bond has received the ‘dark green’ label from the independent green bond rating agency Cicero. This means that the green bond meets the highest standards in terms of use of proceeds and impact transparency. The green bond’s expected return is comparable to the return of a regular (‘grey’) Swedish sovereign bond.

 

Green transportation

APG has been assigned SEK 225 million (roughly € 25 million). In total, Sweden has raised over € 1.9 billion with the issuance of its first green sovereign bond. The money will be used, among other things, to fund sustainable transport. Domestic transport accounts for one third of Sweden’s total carbon emissions. The bond’s proceeds can be used for investment in for example public transport, electrification of the automobile fleet and digital solutions for reducing the number of transport movements.  

 

Contribute to sustainability ambitions

The investment in this green bond contributes to our pension fund clients’ responsible and sustainable investment ambitions. ABP, our largest client, aims to have at least 20% of its assets invested in companies or projects that contribute to the Sustainable Development Goals (SDGs) by 2025. BpfBOUW has the goal to invest € 12 billion in the SDGs by the end of this year. The SDGs were set by the United Nations in 2015 and focus on, among other things, sustainable cities, affordable and clean energy and climate action.

 

Large green bond investor

APG is one of the world’s largest green bond investors. Previously, we participated in the issuance of green sovereign bonds by the Netherlands, France and Ireland. At the end of 2019, we had invested € 9 billion in green, sustainable and social bonds on behalf of our pension fund clients ABP, bpfBOUW, SPW and PPF APG. To encourage further development of this market, APG has published the Guidelines for Green, Social and Sustainable Bonds. This document outlines our expectations for companies, institutions and governments that consider issuing green bonds.

 

 

Published in these collection(s)

Responsible investing

Collection in Sustainability, Long-term investment