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ARTICLE · 26 APRIL 2019

Sustainable Loans Are Here To Stay

Arthur Cox
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Sustainable loans are bilateral or syndicated credit facilities where the terms of the financing offer the borrower some form of incentive to achieve targets for improving their environmental ...

IrelandFinance and Banking
Arthur Cox
Arthur Cox
Charlotte Upton
Charlotte Upton
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Sustainable loans are bilateral or syndicated credit facilities where the terms of the financing offer the borrower some form of incentive to achieve targets for improving their environmental, social and governance (ESG) or sustainability performance.

Introduction

There have been various positive developments relating to green finance over the past few years: for example, Ireland is one of several sovereigns to have issued a green bond in line with the International Capital Market Association Green Bond Principles and numerous corporate borrowers have entered into loan financing transactions which comply with the green loan principles published by the Loan Market Association and other trade associations (the Green Loan Principles). However, recent Bloomberg data has shown that the issuance of 'sustainability-linked' or 'ESG-linked' loans (referred to in this briefing as sustainable loans) outstripped that of green loans in 2018.

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This article contains a general summary of developments and is not a complete or definitive statement of the law. Specific legal advice should be obtained where appropriate.

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