Capacity building of CREPMF on sustainable finance, ESG investment and Green bonds

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EXTERNAL EVALUATOR ESG

CUSTOMER:

UEMOA Regional Council for Public Savings and Financial Markets (CREPMF)

Funded by the African Development Bank (AfDB) through the Regional Financial Market Development Support Project (PADMAFIR)

  • 2019

BACKGROUND AND PROBLEM:

Faced with the growing demand for responsible and sustainable investments on a regional and global scale, and the search for new asset classes by market participants, the African Development Bank (AfDB) and the Regional Council for Public Savings and Financial Markets (CREPMF) agreed on the need to promote a specific framework for the issuance of sustainable financial assets on the regional financial market. This objective should work towards an increased convergence of standards in sustainable finance in order to guarantee the quality and consistency of information disclosure, the costs of issuance and the attractiveness of certain types of investors.

The introduction and development of new instruments to boost the regional financial market requires an improvement in the supervisory or support capabilities of the regulator (that is CREPMF) in order to cope with the rapidly changing interest of issuers and investors in new products and instruments of sustainable financing. In addition, CREPMF is a signatory to the “Marrakech Pledge” which is a call to action by all African capital markets to work together for sustainable development.

As part of the implementation of this call and the priorities set out in the 2014-2021 Regional Financial Market Strategic Plan, CREPMF authorized the issuance of Social Bonds on the regional financial market in September 2018 for a total of 125 million euros.

In order to better regulate the issuance of green bonds on the regional financial market, CREPMF has sought our support to strengthen its capacity in understanding new concepts of sustainable finance and ESG investment, including green bond issues.

SERVICES PROVIDED:

Our mandate was to build the capacity of CREPMF on sustainable financing initiatives, in particular green bond issues. This involved developing and delivering a training program for the members of the Council and the staff of the General Secretariat; to make a critical review of the current framework of bond issues on the regional financial market and to propose the necessary adjustments to be made in order to allow green bond issues and / or sustainable finance.

RESULTS OBTAINED:

  1. Training of the members of the Council and the staff of the General Secretariat of the CREPMF. The training sessions reviewed the concepts of sustainable development and sustainable finance, the concepts of ESG and SRI investment, green bonds and the various examples of green bond regulations around the world.
  2. Critical analysis of the existing framework. We have also carried out a critical examination of the existing framework for bond issues on the regional financial market and propose the necessary adjustments to be made in order to allow green and sustainable bond issues.
  3. Revision of the new guide. We have also revised the guide being finalized for achieving green and sustainable bond issues on the regional financial market.

The results of this service enabled CREPMF to adopt Circular No. 01/CREPMF/2020 on the implementation of a guide for green, social and sustainable bond issues in the UMOA regional financial market.

EN