Global loan market associations launch new guidance documents to support the Green Loan Principles and the Sustainability Linked Loan Principles05 May 2020
The APLMA, LMA and LSTA are delighted to announce the publication of two new guidance documents, which aim to address some of the most frequently asked questions in relation to the Green Loan Principles (GLP) and the Sustainability Linked Loan Principles (SLLP).
The launch of the GLP in 2018 and the SLLP in 2019 were key milestones in the development of the global market for green and sustainability linked loan products. As the market for green and sustainability linked loans continues to grow and develop, market participants have sought clarification on the practical application of the GLP and the SLLP to their deals. By providing further information on these matters, the guidance documents aim to further support the expansion of the market for these important sustainable finance products.
The guidance documents were produced with input from each association's respective green and sustainable finance working party, each of which consists of representatives from leading financial institutions and law firms across the globe and aims to find a globally acceptable approach to the granting of green and sustainability linked loan products.
Commenting on the guidance, Gemma Lawrence-Pardew, Senior Associate Director - Legal of the LMA, said:
"There has never been a more important time for financial markets to adapt and respond to climate-related risks and broader ESG issues. Whilst the growth of the market for green and sustainability linked loan products has been very encouraging over the last few years, there is still more to be done to bring these products into the mainstream. We hope that the launch of these guidance documents will help to further break down barriers to the use of these innovative finance products in the syndicated loan market."
Tess Virmani, Associate General Counsel & EVP, Public Policy of the LSTA, commented:
“We have seen exciting growth in sustainable finance globally and we believe continued education and guidance around these types of loans will further support that momentum. The new guidance documents together with the related frameworks will serve as the building blocks for broader market adoption. We are delighted to be taking this next step in our global coordination on sustainable finance.”
Rosamund Barker, Head of Legal at the APLMA, commented:
"We trust borrowers and lenders in the syndicated loan market across the globe wishing to take advantage of green and sustainability linked loan products will find these guidance documents informative. It has been a pleasure collaborating with our sister organisations in putting them together."