AB Explains ESG-Labeled Bonds: Quality Over Quantity
AllianceBernstein (AB) has analyzed over 11,000 ESG-labeled bonds, revealing that while issuance has declined, the overall quality of the market has improved. AB's proprietary strength score, based on disclosure, ambition, and credibility of targets, shows a surge in quality across issuers and vintage years.
Key findings include:
- Weaker issues are less frequent in the market
- Greenwashing appears to be less of an issue
- Active investors are guiding issuers towards stronger ESG-labeled bond structures
AB's engagements with companies have shown positive results, such as supporting ambitious sustainability-linked bonds (SLBs) and encouraging substantial scope 3 emissions reduction targets. This analysis demonstrates the evolving landscape of ESG-labeled bonds, emphasizing quality over quantity in the market.
AllianceBernstein (AB) ha analizzato oltre 11.000 obbligazioni etiche etichettate ESG, rivelando che, sebbene l'emissione sia diminuita, la qualità complessiva del mercato è migliorata. Il punteggio di forza proprietario di AB, basato su divulgazione, ambizione e credibilità degli obiettivi, mostra un aumento della qualità tra gli emittenti e negli anni di emissione.
I principali risultati includono:
- Emissioni più deboli sono meno frequenti nel mercato
- Il greenwashing sembra essere meno problematico
- Investitori attivi stanno guidando gli emittenti verso strutture di obbligazioni etiche più solide
Gli impegni di AB con le aziende hanno mostrato risultati positivi, come il supporto a obbligazioni collegate alla sostenibilità (SLB) ambiziose e l'incoraggiamento a obiettivi sostanziali di riduzione delle emissioni di portata 3. Questa analisi dimostra l'evoluzione del panorama delle obbligazioni etiche etichettate ESG, enfatizzando la qualità rispetto alla quantità nel mercato.
AllianceBernstein (AB) ha analizado más de 11,000 bonos con etiqueta ESG, revelando que, aunque la emisión ha disminuido, la calidad general del mercado ha mejorado. La puntuación de fuerza propietaria de AB, basada en la divulgación, ambición y credibilidad de los objetivos, muestra un aumento en la calidad entre los emisores y los años de emisión.
Los hallazgos clave incluyen:
- Los problemas más débiles son menos frecuentes en el mercado
- El greenwashing parece ser menos problemático
- Los inversores activos están guiando a los emisores hacia estructuras de bonos etiquetados ESG más sólidas
Los compromisos de AB con las empresas han mostrado resultados positivos, como apoyar bonos vinculados a la sostenibilidad (SLB) ambiciosos y fomentar objetivos sustanciales de reducción de las emisiones de alcance 3. Este análisis demuestra el panorama en evolución de los bonos etiquetados ESG, enfatizando la calidad sobre la cantidad en el mercado.
AllianceBernstein (AB)는 11,000개 이상의 ESG 라벨이 붙은 채권을 분석하여 발행이 감소했지만 시장의 전반적인 품질이 향상되었다고 밝혔습니다. AB의 독점적인 강점 점수는 공시, 야망 및 목표의 신뢰성을 기반으로 하여 발행자와 연도 간 품질의 급증을 나타냅니다.
주요 발견 사항은 다음과 같습니다:
- 약한 이슈는 시장에서 덜 자주 발생함
- 그린워싱 문제가 덜 다루어지는 것처럼 보임
- 활발한 투자자들이 발행자를 더 강력한 ESG 라벨 채권 구조로 안내하고 있음
AB의 기업과의 협력은 긍정적인 결과를 보여주었으며, 이는 야심찬 지속 가능성 연결 채권(SLB)을 지원하고 상당한 범위 3 배출량 감소 목표를 장려하는 등의 내용을 포함합니다. 이 분석은 ESG 라벨이 붙은 채권의 진화하는 환경을 보여주며, 시장에서 수량보다 품질을 강조합니다.
AllianceBernstein (AB) a analysé plus de 11 000 obligations étiquetées ESG, révélant que bien que l'émission ait diminué, la qualité globale du marché s'est améliorée. Le score de force propriétaire d'AB, basé sur la divulgation, l'ambition et la crédibilité des objectifs, montre une augmentation de la qualité parmi les émetteurs et les années d'émission.
Les principales conclusions comprennent :
- Les émissions plus faibles sont moins fréquentes sur le marché
- Le greenwashing semble être moins problématique
- Les investisseurs actifs guident les émetteurs vers des structures d'obligations étiquetées ESG plus solides
Les engagements d'AB auprès des entreprises ont montré des résultats positifs, soutenant des obligations connectées à la durabilité (SLB) ambitieuses et encourageant des objectifs significatifs de réduction des émissions de portée 3. Cette analyse démontre l'évolution du paysage des obligations étiquetées ESG, en soulignant la qualité par rapport à la quantité sur le marché.
AllianceBernstein (AB) hat über 11.000 ESG-etikettierte Anleihen analysiert und festgestellt, dass die Emissionen zwar zurückgegangen sind, die Gesamtqualität des Marktes sich jedoch verbessert hat. Das proprietäre Stärke-Score von AB, das auf Offenlegung, Ambitionen und Glaubwürdigkeit der Ziele basiert, zeigt einen Anstieg der Qualität bei Emittenten und Jahrgängen.
Wesentliche Erkenntnisse sind:
- Schwächere Emissionen sind im Markt seltener
- Greenwashing scheint weniger problematisch zu sein
- Aktive Investoren leiten Emittenten zu stärkeren ESG-etikettierten Anleihestrukturen
Die Engagements von AB mit Unternehmen haben positive Ergebnisse gezeigt, wie die Unterstützung ambitionierter nachhaltigkeitsgebundener Anleihen (SLBs) und die Förderung wesentlicher Ziele zur Reduzierung der Scope-3-Emissionen. Diese Analyse zeigt die sich entwickelnde Landschaft der ESG-etikettierten Anleihen und betont Qualität über Quantität im Markt.
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NORTHAMPTON, MA / ACCESSWIRE / August 21, 2024 / AllianceBernstein
ESG-Labeled Bond Issuance Has Declined, but Quality Has Improved
After a rapid ascent, issuance of ESG-labeled bonds has fallen back recently, even as we've observed that the overall quality of the market has improved (Display). That's an intriguing combination-with an explanation.
We've analyzed over 11,000 ESG-labeled bonds, comparing each bond's stated intentions at the time of issue with actual performance 12 months later (for example, how the bond's proceeds were allocated across different projects, and the ESG impact of those projects).
Using three criteria-disclosure, plus ambition of and credibility versus targets-and employing more than 20 underlying factors with different weightings, we calculated a quality (or strength) score for each bond, enabling us to compare them across issuers, universes and vintage years.
The surge in strength scores aligns with our experience: weaker issues are coming to market less frequently, so the overall quality of the new-issue market is rising and greenwashing seems less of an issue. We also believe that much of the improved strength is a result of diligent active investors guiding issuers to develop stronger ESG-labeled bond structures.
Our own engagements* offer examples. A global utility company issued sustainability-linked bonds (SLBs) with ambitious targets, which it missed. Our discussions with management revealed the reasons were both temporary and outside their control. We commended their ambition and supported further SLB issuance. Also, a European consumer company's SLB targeted substantial scope 3 emissions reductions-even though many peers only disclose scopes 1 and 2.
*AB engages companies where it believes the engagement is in the best interest of its clients.
The views expressed herein do not constitute research, investment advice or trade recommendations and do not necessarily represent the views of all AB portfolio-management teams. Views are subject to change over time.
Learn more about AB's approach to responsibility here.
Past performance does not guarantee future results. AB ESG-labeled bond strength score represents a proprietary analysis of ESG-labeled bonds 12 months after they were issued. The rating is based on the bonds' stated targets and progress towards those targets. A higher score reflects a stronger ESG-labeled bond. Scores shown above are the market average for each vintage year. Through December 31, 2023 Source: Bloomberg, LGX Datahub and AB
View additional multimedia and more ESG storytelling from AllianceBernstein on 3blmedia.com.
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SOURCE: AllianceBernstein
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FAQ
What has AllianceBernstein (AB) observed about ESG-labeled bond issuance recently?
How does AB evaluate the quality of ESG-labeled bonds?
What factors contribute to the improved quality of ESG-labeled bonds, according to AB?
Can you provide an example of AB's engagement with companies regarding ESG-labeled bonds?
What type of emissions reduction targets did AB observe in a European consumer company's SLB?
