Sustainable consultancy firm Carbon Care Asia (CCA) has partnered with Frankfurt-based index provider Solactive for the launch of the first Asia sustainable bond index.
Expanding Solactive’s environmental, social and governance (ESG) offering, the Solactive CarbonCare Asia Sustainability Bond index is the first of its kind measuring the growth of green, social and sustainability bonds in the region.
The index is comprised of bonds that are issued to contribute to environmental sustainability and address social challenged leading to a positive impact in the region.
CCA carries out the screening methodology which involves a two-step process. It examines the transparency standards of the bond issuers and that the proceeds from the bonds are designated for projects that have a significant positive outcome.
The global issuance of green bonds has grown sixteen-fold over the last five years, reaching $170bn worth of outstanding debt in 2018, according to Solactive. Asia has been a significant driver for the growth having reached more than $35bn in the first three-quarters of 2019.
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CCA said that there is a trust gap between investors and Asia-Pacific bonds. The launch of the index is to support the company's bid to promote sustainability practices and accelerate the transition to a net-zero carbon economy.
Steffen Scheuble (pictured), CEO of Solactive, commented: “We hope this index will be a valuable tool for asset owners in managing their ESG mandates and that it will serve as a reference for the wider investment community.”