The issuance of Chile’s sovereign ESG bonds started in 2019 with the issuance of green bonds. This first transaction provided positive financial results while demonstrating Chile’s commitment to climate action. On December 2020, Chile published its Sustainable Bond Framework that allowed the Republic to issue social and sustainable bonds.
Through this Sustainability-Linked Bond Framework (SLB Framework), the Ministry of Finance is further expanding its commitment to sustainable development. This SLB Framework, in conjunction with Chile’s existing Sustainable Bond Framework (2020), will provide clear and transparent information to the market related to future Green, Social, Sustainable, and Sustainability-Linked Bonds (SLBs).
Through the issuance of SLBs, Chile intends to leverage ambitious timelines to achieve strong sustainable outcomes that are relevant, core and material to Chile and its people, as well as to create benchmark for other sovereigns. Chile expects that the issuance of its SLBs will build upon Chile’s prior Green, Social, and Sustainable bond issuances and inspire other countries and companies to do the same.
This SLB Framework is aligned with ICMA's Sustainability-Linked Bond Principles published in June 2020, complying with the five core components outlined therein:
1. Selection of Key Performance Indicators (KPIs);
2. Calibration of Sustainability Performance Targets (SPTs);
3. Bond characteristics;
4. Reporting; and
5. Review and Verification.
Chile's SLB Framework and Sustainalytics' Second Party Opinion (SPO) on the alignment with SLB Principles developed by ICMA could be found below.
5/05/22 Chile's Experience in the ESG Market
Chile's Sustainability-Linked Bond Framework
Second Party Opinion - Sustainalytics
Frequently Asked Questions on SLBs