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Add to Preferred SourcesThe Asian Infrastructure Investment Bank (AIIB) and Amundi, Europe’s largest asset manager, have announced a USD500-million Asia Climate Bond Portfolio which aims to accelerate climate action in the Bank’s members and address the underdevelopment of the climate bond market.
Through a managed fixed income portfolio of an initial USD500-million, the joint project expects to mobilize another USD500-million from climate change-focused institutional investors. A portion of the investment proceeds will be allocated to market education, engagement and issuer support.
Amundi and AIIB have developed a first-of-its-kind Climate Change Investment framework, which takes into account three variables, portion of green business activities, climate mitigation and resilience to climate change, to analyze issuers’ ability to cope with climate change.
The Asia Climate Bond Portfolio will invest in labeled green bonds and unlabeled climate bonds and engage with issuing companies to help them transition their business models to increase climate resilience and green leadership. The portfolio will seek performance by identifying, analyzing and selecting tomorrow’s climate champions based on this framework.
“This portfolio is another example of how AIIB works with leading partners to develop innovative financial products to deepen capital markets for infrastructure,” said AIIB Vice President and Chief Investment Officer D.J. Pandian. “We expect this investment will demonstrate how international financial institutions can approach development finance differently to support the Paris Agreement and adoption of climate finance principles.”
This project will also entail an ambitious engagement policy to support the emergence of climate champions in infrastructure and other productive sectors.
The Asia Climate Bond Portfolio will begin investing in January 2020 and will progressively deploy the committed capital in eligible assets.
Original source: AIIB
Published on 10 September 2019