TOKYO — The World Bank (International Bank for Reconstruction and Development, IBRD, Aaa/AAA) today issued an AUD 516 million sustainability bond with an 8-year maturity, due April 26, 2030.
A group of Japanese life insurance companies invested in the bond to support the World Bank’s integrated approach to integrating climate change mitigation and adaptation efforts into its lending. As the largest multilateral financier of climate action in developing countries, the World Bank strives to integrate climate activities into all its operations, including investments in social sectors such as education. and health. In the last fiscal year, all IBRD projects were screened for climate risks and more than 95% incorporated dedicated climate components. This includes projects in all sectors and regions, not just sectors typically associated with climate investments. For example, projects in education ensure that new school buildings are built to be community shelters from natural hazards and in the health sector, projects are designed to improve energy efficiency in hospitals and clinics. health. While in the agricultural sector, projects have been designed to promote climate-smart agriculture and to reduce food loss and waste.
This transaction builds on IBRD’s green bond issuance in September 2021, also bringing together Japanese life insurance companies to invest in bonds that demonstrate their collective support for the urgency of climate action. . With their first purchase of sustainability bonds, these companies show their support for the World Bank’s priority to ensure that climate actions are integrated into all new investments. In alphabetical order, Asahi Mutual Life Insurance Company, The Dai-ichi Life Insurance Company, Limited, Fukoku Mutual Life Insurance Company, Meiji Yasuda Life Insurance Company and Sumitomo Life Insurance Company.
Citigroup Global Markets Limited acted as underwriter for this transaction (Citigroup Global Markets Japan Inc. is the bond arranger).
Jorge Familiar, Vice President and Treasurer of the World Bank, said: “Investors are increasingly integrating environmental, social and governance criteria into all their investment decisions. They look for products that take a holistic approach to tackling climate change and social challenges to support a more sustainable future. We are grateful to Japanese life insurance companies for coming together to show their support for the World Bank’s efforts to mainstream climate action in developing countries and thank them for their investment.
Takahiro Ono, Managing Director of Asahi Mutual Life Insurance Company, said, “As a responsible institutional investor, Asahi Mutual Life Insurance aims to contribute to the solutions to global social issues such as environmental issues, in line with global efforts to achieve to a sustainable society. We invested in this bond to support the World Bank’s holistic approach to climate action. We place “coexistence with society through continuous commitment to create a prosperous society” as one of our priority actions for sustainable management based on our core management philosophy “Sincere Service”. We will continue to actively invest in ESG to help build a sustainable society.
Kazuyuki Shigemoto, Managing Director, Managing Director, Investment, The Dai-ichi Life Insurance Company, said, “Dai-ichi Life, as a “universal owner” who manages assets received from clients, has promoted ESG investing. In particular, we see climate change as the most important issue in responsible investing. This investment expands support not only for existing green projects, but also for strengthening climate change action across a wider range of projects, and should help create a society that is highly resilient to climate change. As a responsible institutional investor, the Company will continue to actively engage in ESG investing to help achieve a sustainable society as well as improve its return on investment through sophisticated and diversified investment methods. .
Takehiko Watabe, Director and Managing Director of Fukoku Mutual Life Insurance Company, said, “Fukoku Life is actively engaged in ESG investing under our business policy of ‘contributing to the realization of a sustainable society as a mutual ‘life insurance “. We are very pleased to support the World Bank’s commitment to support the expansion of climate change action in developing countries and we believe that this investment helps us not only to gain financial advantage, but also to contribute positively to society, in line with our company philosophy. Fukoku Life will continue to strive to be an organization that promotes true self-help based on the concept of THE MUTUAL.
Masao Aratani, Director, Vice President and General Manager, Investment Division, Meiji Yasuda Life Insurance Company, said, “Recognizing the urgent need for action to combat climate change globally, we have positioned ‘Protect the Environment and fight against climate change”. ‘ as a priority issue requiring new initiatives. In accordance with this positioning, efforts are now underway to intensify our initiatives in this area. We decided to invest in this bond to support the World Bank’s efforts to increase climate finance in developing countries. As a responsible institutional investor, we carry out asset management that contributes to the creation of a sustainable society in order to fulfill our social responsibility and our public mission as a life insurer while guaranteeing a stable profit, in accordance with our management philosophy, Peace of Mind, Forever.”
Iwao Matsumoto, Managing Director of Sumitomo Life Insurance Company, said, “Climate change is an important issue that needs to be addressed beyond national borders. We support the World Bank’s commitment to support developing countries and have invested in their Green Bonds and Sustainability Bonds to this end. We welcome the fact that this investment will stimulate decarbonization and environmentally friendly projects in developing countries. Through responsible investing, Sumitomo Life will continue to contribute to the realization of a sustainable society and improve returns on investment.
Philip Brown, Head of Public Sector and Sustainable DCM at Citi, said, “Citi is proud to have worked on this transaction with the World Bank and a select group of leading Japanese sustainability bond insurers to IBRD climate action. Climate change remains the greatest challenge of our time, and the World Bank’s ongoing efforts in this area are strongly supported and aligned with Citi’s goals and those of our clients.
Through the issuance of sustainability bonds, the World Bank has engaged with investors to explain how its bonds support the financing of projects that contribute to climate action and how the updated action plan World Bank Climate Change Report helps countries integrate climate change into their development strategies. and applying climate finance in ways that achieve the most positive impact. Applying a “whole economy” approach with clients in developing countries helps the World Bank integrate climate considerations across its portfolio, including in high-emissions sectors as well as in sectors not usually associated with climate action such as health, education and agriculture.