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The way Australian companies, especially in the financial sector, are responding to environmental and social risks is becoming more sophisticated and more prominent. Siobhan Toohill, group head of sustainability at Westpac Banking Corporation (Westpac) in Sydney, says collaboration between industry participants is taking progress to a new level.
A year after it was established, the New Zealand Sustainable Finance Forum (NZSFF) published an interim report and legal opinion on how the country can shift to a more sustainable footing. NZSFF co-chairs, Karen Silk, general manager at Westpac in Auckland, and Matt Whineray, chief executive at New Zealand Super Fund in Auckland, provide an exclusive overview of this work.
Transition is the theme of the day in global sustainable debt, and Australian capital markets are adopting the idea that funding environmental and social evolution across the economy is the next frontier of development. But they are hamstrung by retrograde government behaviour – especially in the environmental space.
The scale of Australia’s infrastructure task means investors in the sector are instrumental in driving climate change outcomes. They also recognise that climate-risk assessment is a financial consideration and, therefore, they have a fiduciary obligation in the environmental, social and governance (ESG) arena. If they ignore this, they risk failing to deliver long-term, sustainable returns.
With €1.6 trillion (US$1.7 trillion) in assets under management, Amundi is Europe’s largest asset manager and in the top 10 worldwide by funds under management. The firm is recognised as a powerhouse in the environmental, social and governance (ESG) space and it is working toward an ambitious plan for 2021. Jean-Jacques Barbéris, head of institutional and corporate clients coverage at Amundi in Paris, outlines this plan and the strategies for how to achieve it.
KangaNews talks to Yo Takatsuki, head of ESG research at AXA Investment Managers (AXA IM) in London, about the ground-breaking guidelines for transition bonds his firm published in June 2019. Takatsuki was instrumental in formulating the guidelines. He shares his insights into the urgency of opening up the transition pathway so carbon-intensive industries are encouraged to work towards aligning with the Paris Agreement.
The Kangaroo supranational, sovereign and agency (SSA) market has started 2019 with a trickle rather than its usual flood and intermediaries say Australian dollar pricing has been uncompetitive compared with offshore markets. They report solid fundamental demand but say a supply uptick is unlikely until there is a shift in the basis swap and pricing expectations.
Contact Energy (Contact)’s new sustainability-linked loan (SLL) incentivises improvements in areas such as corporate governance, stakeholder engagement and environmental impact. Participants in the deal believe that the SLL product will be applicable for a broad set of borrowers in New Zealand as it is elsewhere.
On 16 January, International Finance Corporation (IFC) (AAA/Aaa) launched a minimum A$50 million (US$34.6 million) increase to its June 2029 Kangaroo bond. Indicative price guidance for the forthcoming deal is 43 basis points area over semi-quarterly swap, equivalent to 44.75 basis points area over Australian Commonwealth government bond. Pricing is expected on the day of launch, according to joint lead managers Nomura and TD Securities.
On 16 January, Pepper Group (Pepper) began taking indications of interest for its new auto and equipment asset-backed securities (ABS) transaction, Pepper SPARKZ Trust 2. Total capped volume for the deal is A$618.5 million (US$427.2 million), according to National Australia Bank.
Westpac Banking Corporation (Westpac) executed a multitranche senior-unsecured deal and a covered-bond transaction in the US dollar market on 9 January 2020. The issuer says it received strong ongoing support as major-bank benchmark deals continue to flow freely in domestic and global markets, though the US has been the jewel in the crown.