Project Details
Project
Telefónica SDG Framework Second-Party Opinion
Client
Telefónica
Project Type
Sustainability Bond/Loan
Industry Group
-
Use of Proceeds
-
Location
Spain
Evaluation Date
Nov 2018
Evaluation Summary
Sustainalytics is of the opinion that the Telefónica SDG Framework is credible and impactful, and aligns with the four core components of the Green Bond Principles 2018, Social Bond Principles 2018 and Sustainability Bond Guidelines 2018. This assessment is based on the following:
USE OF PROCEEDS
The eligible categories for the use of proceeds – (i) Energy Efficiency of Telefónica’s Network Infrastructure, (ii) Renewable Energy, (iii) Energy Efficiency: Digital Solutions for the Environment, (iv) Digital Inclusion, Access for all through an Affordable Infrastructure, and (v) Employment Generation and Economic Growth – are aligned with those recognized by the Green Bond Principles, Social Bond Principles and Sustainability Bond Guidelines. Sustainalytics views that the ‘Eligible Projects’ will support carbon abatement for Telefónica’s own operations and for its customers through the provision of smart solutions that help save energy. Furthermore, Sustainalytics believes that ‘Eligible Projects’ will support socioeconomic development through digital inclusion and SME financing.
PROJECT EVALUATION/SELECTION
Telefónica’s project evaluation and selection is governed by a dedicated SDG bond committee / working group. The committee has cross-departmental senior management representatives from the Finance Department, Sustainability Department, Control Department and other technical areas. This process is in line with market practices.
MANAGEMENT OF PROCEEDS
Proceeds from the green and social bonds will be earmarked and monitored internally through an SDG Register. Pending full allocation, Telefónica will invest the unallocated proceeds according to its normal liquidity policy. This is in line with market practices.
REPORTING
Telefónica intends to provide allocation and impact reporting annually on the company’s website. The (i) allocation report will comprise data on the eligible projects financed through the bonds, including the amounts allocated, the bond proceeds allocated per eligible category and the remaining balance of unallocated proceeds. With regards to the (ii) impact report, Telefónica will disclose a comprehensive list of relevant KPIs for each use of proceeds category. Sustainalytics views the scope and granularity of Telefónica’s reporting to be aligned with market practices.