How the first bond linked to the United Nation’s Sustainable Development Goals came about.
Our approach to climate change encompasses a holistic view of commercial solutions to mitigate climate risk and capture opportunities that promote environmental progress across growth areas in clean energy, sustainable transport, food and agriculture, waste and materials, and ecosystem services.
Working with Enel, an Italy-headquartered company, Goldman Sachs helped structure the first sustainability performance bond linked to the United Nations’ Sustainable Development Goals (SDGs). Rather than restrict the use of proceeds to specific green projects, the bond ties Enel’s cost of capital to its strategic commitment to make installed capacity 55% renewable by the end of 2021 — core to the company’s broader de-carbonization strategy, including its long-term goal of net-zero emissions. Under the bond’s performance-based covenant, investors receive a step up in interest rates if the target is not met. Issued in September 2019, Enel’s $1.5 billion inaugural SDG-linked bond was preceded by robust discussions with investors on the innovative structure, and followed in October by a €2.5 billion similar offering. Enel has operations in 33 countries on five continents. It manages 46 gigawatts of capacity from renewable sources and supplies 70 million customers worldwide.
Read more in our Sustainability Report.
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