January 2018: The international community is taking steps to gear financial markets towards the implementation of the SDGs and the Paris Agreement on climate change. Initiatives by the World Bank, OECD and others address sustainability financing while reinforcing gender equality, environmental goals, and transparency.
The World Bank issued a Sustainable Development Bond to raise awareness for empowering women and girls, and to accelerate economic development, reduce poverty and build sustainable societies around the world. Achieving gender equality is one of the SDGs (Goal 5) and also one of the key themes under Canada’s 2018 presidency of the Group of Seven (G7). BMO Capital Markets and Bank of America Merrill Lynch serve as joint lead managers for the bond. Offering investors an opportunity to align financial and social objectives, the bond was oversubscribed, with more than 40 investors placing orders for more than CAD1.2 billion.
Roger Beauchemin, CEO Addenda Capital, noted that the success of the bond reinforces the view that investors must look beyond green bond labels to identify opportunities for clients to have a positive social and environmental impacts while still generating competitive investment returns. Suzanne Buchta, Bank of America Merrill Lynch, said the exceptional market response reflects a growing social awareness among the Canadian investor community, while highlighting the World Bank’s dedication to engaging with investors on innovative capital market instruments that support sustainable development outcomes.
The Organisation for Economic Co-operation and Development (OECD) launched the ‘Paris Collaborative on Green Budgeting,’ an initiative aimed at driving the alignment of national budgetary processes with the Paris Agreement and other environmental goals. The announcement was endorsed by Environment Ministers Nicolas Hulot of France and Rafael Pacchiano of Mexico, during the One Planet Summit held on 12 December 2017, in Paris, France.
The Paris Collaborative is the first cross-country and cross-sectoral initiative designed to support governments to “green” their fiscal policy by embedding climate and other environmental commitments within national budgeting and policy frameworks, such as the Aichi biodiversity targets. It will develop agreed definitions, tools, methodologies and guidelines that will allow countries and citizens to track progress on green budgeting both nationally and internationally. OECD Secretary-General Angel Gurría explained that the Initiative will contribute to the achievement of the Paris Agreement and the SDGs by changing how governments think and act in their budgetary process. The initiative will be convened by the OECD, in partnership with governments around the world.
In November 2017, 200 delegates from more than 90 countries met for the 10th meeting of the Global Forum on Transparency and Exchange of Information for Tax Purposes, which contributes to the SDG target 17.1. The meeting convened in Yaoundé, Cameroon, in the aftermath of the release of the ‘Paradise Papers.’ The Global Forum adopted the first report on the status of implementation of the Automatic Exchange of Information (AEOI) Standard, a few weeks after almost 50 countries started exchanges of information under the new standard on automatic exchange of information, with another 53 countries starting in September 2018. The principle of annual implementation reports and peer reviews were also agreed at the meeting.
The Forum’s Africa Initiative will continue the work in order to benefit from advances in tax transparency, while other regional initiatives in Latin America and the Caribbean and in Asia are also helping to improve cross border taxation through effective use of exchange of information, both on request and automatically. The Forum currently includes 148 countries and jurisdictions. [World Bank Press Release] [OECD Press Release] [Global Forum Press Release]
References: International Institute for Sustainable Development. 2018. Retrieved from http://sdg.iisd.org/news/world-bank-oecd-advance-financing-initiatives-for-sdgs-paris-agreement/?utm_medium=email&utm_campaign=2018-02-06%20-%20SDG%20Update%20AE&utm_content=2018-02-06%20-%20SDG%20Update%20AE+CID_6d45e1b29a77180993f8274027c7d01c&utm_source=cm&utm_term=World%20Bank%20OECD%20Advance%20Financing%20Initiatives%20for%20SDGs%20Paris%20Agreement