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Coles has converted around half its outstanding bank debt to sustainability-linked loan format in a deal the organisation says embeds accountability for its public sustainability targets throughout the organisation. Coles will also consider further sustainability-linked options for future refinancing needs.
Differing levels of progress across global jurisdictions toward the end goal of LIBOR cessation demonstrates both that a successful transition is possible and that pitfalls await for those that do not move swiftly enough. There are lessons for Australia and New Zealand in how international markets have adapted to benchmark change.
Discussions at the KangaNews Sustainable Debt Summit 2021 virtual event in June suggest market engagement with environmental, social and governance issues continues to deepen. Norms in sustainability-linked instruments are quickly solidifying while developments in accounting, disclosure and stakeholder engagement are also contributing to momentum.
Sustainable finance continues to gather momentum in 2021, with record labelled issuance and ‘greeniums’ developing into the norm for pricing these instruments. A recent thesis questions the efficacy of such developments, however – instead calling for a sustainable-finance market that considers entities as a whole rather than their individual assets.
The Australian Office of Financial Management says demand for its latest Treasury indexed bond syndication was consistent with its historical experiences despite increased market focus on the inflation outlook. The government debt-management agency returned to inflation-linked syndication for the first time since September 2018 and does not foresee a significant increase in supply.