Project Details
Project
AIB Green Bond Framework Second-Party Opinion 2021
Client
AIB Group PLC
Project Type
Green Bond/Loan; EU Taxonomy Assessment;
Industry Group
-
Use of Proceeds
-
Location
Ireland
Evaluation Date
Dec 2021
Evaluation Summary
Sustainalytics is of the opinion that the AIB Green Bond Framework is credible and impactful and aligns to the four core components of the Green Bond Principles 2021. This assessment is based on the following:
USE OF PROCEEDS
The eligible categories for the use of proceeds – Green Buildings, Renewable Energy, and Clean Transportation – are aligned with those recognized by the Green Bond Principles 2021. Sustainalytics considers that the provision of financing in the eligible categories will lead to positive environmental impacts and advance the UN Sustainable Development Goals, specifically SDGs 7, 9 and 11.
PROJECT EVALUATION / SELECTION
AIB’s Group Sustainability Committee (GSC), which consists of senior officials from multiple departments, will be responsible for overseeing the process of selecting eligible loans, according to the criteria set in the Framework prepared by the AIB Green Bond Working Group. AIB has a dedicated environmental and social risk assessment and mitigation process that is applicable to all allocation decisions made under the Framework. Sustainalytics considers the project selection process to be in line with market practice.
MANAGEMENT OF PROCEEDS
AIB intends to allocate the proceeds from the green bonds to a green loan portfolio. Pending allocation, AIB will hold and/or invest in its treasury liquidity portfolio in cash or other short term and liquid instruments, or to pay back a portion of its outstanding indebtedness, the balance of net proceeds not yet allocated to the Eligible Green Loan Portfolio. In accordance with its Socially Responsible Investment Bond Framework1, AIB intends to assign at least a portion of any unallocated green bonds net proceeds to ESG orientated assets. Sustainalytics considers this to be in line with market practice.
REPORTING
AIB intends to report on the allocation of proceeds to the Eligible Green Loan Portfolio on an annual basis, to be renewed every year until maturity of the instruments. In addition, where feasible, AIB intends to report on the impact of the Eligible Green Loan Portfolio at least at category level, including relevant quantitative metrics, calculated by specialist third-party consultants. Sustainalytics views AIB’s allocation and impact reporting as aligned with market practice.
Alignment with the EU Taxonomy
Sustainalytics has assessed AIB’s Green Bond Framework for alignment with the EU Taxonomy and is of the opinion that, of the
Framework’s three eligibility categories (which map to eleven EU activities), two align with the applicable Technical Screening Criteria
(“TSC”) in the EU Taxonomy while one partially aligns; and that one aligns with the Do No Significant Harm (“DNSH”) Criteria while two
partially align. No categories were determined to be not aligned. Sustainalytics is also of the opinion that the activities and projects to be
financed under the Framework will be carried out in alignment with the EU Taxonomy’s Minimum Safeguards.