The terms 'ESG' and 'Green' have become common
in capital markets. They refer to improvements in a broad range of
non-financial performance indicators or metrics spanning: (i)
environmental issues such as climate concern and efficient use of
scarce resources, (ii) social issues including job creation, labour
standards, diversity and operating in high-risk areas, and (iii)
governance considerations involving business ethics, independent
oversight, executive pay and corporate social responsibility.
Export credit and international development banks have always
applied ESG policies to their lending. But outside of a
development context ESG features were originally associated with
listed company debt issuers and expanded to syndicated loan
markets. Both markets have established principles for
"green" issuances and have effectively encouraged a
"green discount" for businesses that are driving ESG
improvements. However, those standards fall short of setting
standardised
