The Johannesburg Stock Exchange (JSE) has launched a segment dedicated to green bonds. The South African Stock Exchange will provide businesses and other institutions with the ability to raise funds through its funding for low carbon initiatives.
"Emitting green bonds can help companies strengthen their accreditation as a sustainable and responsible organization. At the same time, green bonds enable investors to integrate mitigation of climate risk into their investment portfolio, through instruments that meet environmental, social and governance requirements,” said Donna Nemer, the director of capital markets for the JSE.
In addition to the requirements of the global market, the JSE has also put in place mechanisms specific to its environment. Among other things, it has set up an evaluator whose role is to confirm that projects seeking financing from green bonds comply with the required industry standards.
One of the first beneficiaries of this new segment will be Cape Town’s green bond issue, which is already indexed to the JSE and has been certified by the Climate Bonds Initiative. It takes into account mitigation and adaptation initiatives such as the acquisition of electric buses, the energy efficiency of buildings as well as the management of water.