Year-to-date issuance is at $184 billion – which is 78% larger than 2018’s total issuance
Figure 1: use-of-proceeds issuance
Source: Bloomberg, as at 1 March 2023
- As the chart shows, 2022 saw a decline in bond issuance versus 2021 – in line with a broader decline in fixed income issuance. However it was still the second largest issuance of green, social, sustainability and sustainability-linked bonds in their history.
- It has been a strong start to 2023 with January alone seeing $96 billion issued, which is the eighth ever largest month of issuance.
- Year-to-date (YTD) issuance is at $184 billion which, to put it into context and illustrate the growth of this market, is 78% larger than 2018’s annual issuance and a 20% increase year-on-year.
- Breaking this issuance down YTD, 54% of bonds have been green, 26% are sustainability bonds and 20% are social. Green bonds continue to be the favoured instrument of issuance, but this somewhat masks the growing consideration of social factors. We are increasingly seeing social co-benefits embedded in bond issuances and we are having a greater number of conversations with issuers who are considering social benefits. For example, Renault’s1 recently launched sustainability bond framework2 features a fair transition focus through the upskilling of its workers on circular economy, electric mobility and new digital technologies. This is a key area of engagement with issuers for the Social Bond team, ensuring we promote the transition to advanced low carbon technologies but not at the detriment to those most vulnerable in society and without the loss of jobs.
- We are also seeing a broadening of issuance – for example, blue bonds, which finance projects related to ocean conservation. Korea, for example, is advancing decarbonisation of the shipping industry through incentivising owners to adopt low carbon fuel technology.3