SDG BONDS – Leveraging Capital Markets for the SDGs

Who’s behind it? – UN Global Compact, UNEP Finance Initiative

How can it help? – This Guidance was prepared by the UN Global Compact Action Platform on Financial Innovation for the SDGs, a group of leading organizations representing the entire investment value chain, including corporate and sovereign issuers, banks, institutional investors, UN agencies and development banks.

It encourages and guides companies, Governments, cities and others involved in the implementation of the 2030 Agenda to tap into the private capital markets and benefit from cheaper and more reliable funding. The goal is also to inspire major players in the investment community, investors, banks and other financial institutions to increase their allocation of capital toward SDG investments and to contribute to lowering the cost of capital to finance a broad set of private- and public-sector activities in support of the Goals.

The guidance introduces a flexible framework to support the many ways businesses and Governments can contribute to the SDGs, while creating a large and diversified market for investors. In addition, it seeks a paradigm shift where companies and other issuers can compete for capital based not only on their investment thesis, but also on their impact thesis and how they will use funds to contribute to the SDGs. 

This document along with the publication Corporate Finance: A Roadmap to Mainstream SDG Investments seeks to inspire the development of a market for mainstream SDG investments, with enough scale, liquidity and diversification to attract large institutional investors and finance a broad set of private- and public sector activities in support of the SDGs.