Press Release: Practice Note for the Assessment of Pure Play Companies
20 July 2026
The LMA, together with the APLMA and LSTA, has today announced the publication of the Practice Note for the Assessment of Pure Play Companies.
Developed jointly by the three associations, the Practice Note provides market participants with a practical framework for identifying and assessing “pure play companies” whose business activities are primarily focused on environmental or social objectives.
Aligned with the LMA’s mission to unite the loan markets to enhance efficiency, liquidity and transparency, the Practice Note is intended to support greater consistency, transparency and integrity in the treatment of pure play companies 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.
Role within sustainable finance
The Practice Note does not create a new loan label or amend the Green, Social or Sustainability-Linked Loan Principles.
Rather, it is intended to support the analysis and structuring of sustainable loans, recognising that PPC status alone does not determine sustainable terms of a loan or whether a loan can be labelled as green, social or sustainability-linked.
The framework is designed to help market participants better assess sustainability exposure at an entity level, supporting alignment with internal frameworks, regulatory expectations, investor expectations and broader market practice.
Next steps
The LMA and partner associations will continue to monitor market developments and update the Practice Note as appropriate to reflect evolving practices and standards.
For further information about this publication or the LMA's Sustainable Finance work, please contact Leyla Ghaffar-Zadeh at Leyla.Ghaffar-Zadeh@lma.eu.com.
Link to the publication: Sustainable Lending Microsite :: LMA