Second-Party Opinion Download

Sustainalytics is of the opinion that the Council of Europe Development Bank (“CEB”) Social Inclusion Bond Framework aligns with the four core components of the Social Bond Principles 2018. This assessment is based on the following:

USE OF PROCEEDS

The eligible categories for the use of proceeds (i) Social Housing for Low-Income Persons, (ii) Education and Vocational Training, (iii) Supporting Micro, Small & Medium Enterprises (MSMEs) for the Creation and Preservation of Viable Jobs and (iv) Health are aligned with those recognized by the Social Bond Principles and aim to achieve positive socio-economic outcomes. Sustainalytics considers that the projects financed will lead to positive social impacts and advance the UN Sustainable Development Goals, in particular, 3, 4, 8 and 11.

PROJECT EVALUATION/SELECTION

CEB’s internal process in evaluating and selecting projects is carried out in conformity with the political and social aims of the Council of Europe. Borrower’s are responsible for submitting loan applications for potential projects, which are then screened for compliance with the eligibility criteria before approval. Sustainalytics considers the project selection process to be in line with market practice.

MANAGEMENT OF PROCEEDS

CEB’s processes for management of proceeds are handled by the Finance department. Proceeds will be placed in CEB’s treasury pending allocation and further allocated to existing or new loans. As long as any proceeds remain unallocated, they will be managed in line with the standard processes of CEB’s treasury until full allocation. Proceeds will be fully allocated within 24 months and may finance projects/activities with a maximum lookback period of 24 months. This is in line with market practice.

REPORTING

CEB intends to report on the allocation of proceeds through the publication of a Social Inclusion Bond Report on its website on an annual basis until full allocation. Allocation reporting will include a summary of the allocation of proceeds per sector of action and per year of disbursement and, for each sector of action, the distribution of the proceeds by year of disbursement and per country. An independent auditor will review CEB’s allocation of proceeds, which is considered market best practice. In addition, CEB is committed to reporting on relevant impact metrics. Sustainalytics views CEB’s allocation and impact reporting as aligned with market practice.