Sustainability-Linked Loan (“SLL”) Services
Supporting your SLL to achieve a meaningful, measurable, and transparent impact.
- Advisory on SLL framework
- Second Party Opinions
- Collection and verification of borrower data
The SLL Service
We have a wealth of experience collecting, verifying, examining, and reporting ESG data across a wide range of products. Partner with us to find all the necessary tools for both borrowers and lenders to ensure real impact.
Our service includes:
1. Advisory on SLL frameworks (KPIs and SPTs)
To help propose a sound SLL framework, we produce proposals for borrowers and sponsors to agree on with their lenders.
2. Second Party Opinions (“SPOs”)
We can provide a SPO on the soundness and integrity of proposed KPIs and SPTs. Our SPO statements can be used to improve the quality of the SLL or to showcase its quality to all parties involved.
3. Collection and verification of borrower data
Our platform provides the capabilities to measure and report data on a range of KPIs. For routine reporting on performance on SLL KPIs and SPTs, we provide verification statements through a well-governed verification process.
The SLL Conundrum
The flexibility of SLLs has supported widespread uptake in the market. However, this has also drawn criticisms of green and purpose-washing. Poor quality data, immaterial KPIs, and lack of independent assessment are all pitfalls that lenders and borrowers must avoid.
To support tangible positive impact, beyond ‘Business as Usual’, the change brought about by SLLs must be meaningful, measurable, and transparent. The market is already moving towards more ambitious targets with increasingly rigorous KPIs.
We provide a market-leading service that supports your SLL to achieve that meaningful, measurable, and transparent impact.
Why SLLs?
SLLs, also known as ESG-linked loans, are products that encourage the achievement of sustainability goals by the borrower. They are effective tools for lenders and borrowers to achieve a positive impact.
Guidance for these products is provided by the Sustainability-Linked Loan Principles, the current standard set by the Loan Market Association, Loan Syndications and Trading Association, and the Asia Pacific Loan Market Association.
The volumes of SLLs have grown substantially since the first deal in 2017 and this growth has accelerated – €726 bn of SLLs were issued in 2022, which indicates a 146% average annual growth from their inception in 2017. This reflects the desire of lenders and borrowers to collaboratively improve their ESG performance and drive positive change.
