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Publication of Practice Note for the Assessment of Pure Play Companies

In line with our mission to unite the loan markets to enhance efficiency, liquidity and transparency, this Practice Note provides a framework to support market participants in the identification and assessment of “pure play companies” (PPCs), whose business activities are primarily focused on environmental or social objectives. Its aim is to promote consistency, transparency and integrity in the treatment of PPCs within sustainable finance transactions.

Key features of the Practice Note

• Clear eligibility framework: A company may be designated as a PPC where at least 90% of its revenue or assets (or an appropriate alternative metric) are derived from eligible green or social activities.

• Flexible but robust metrics: The framework allows for the use of revenue, assets or credible alternative metrics, depending on the company’s business model and stage of development.

• Environmental and social safeguards: Companies must demonstrate the absence of significant harm and ensure that any non-eligible activities are not incompatible with PPC designation.

Ongoing reporting and reassessment: Annual reassessment and disclosure are expected to support continued PPC status over the life of a transaction.

Access the Practice Note here