ABSA BANK BOTSWANA LIMITED Second-Party Opinion
Report
Second-Party Opinion on Sustainable
Finance Issuance Framework 2023
Absa Bank Botswana Limited
June 2023
Project No.: 0694546
The business of sustainability
Document details
Document title | Second -Party Opinion |
Document subtitle | Second -Party Opinion on Sustainable Finance Issuance Framework 2023 |
Project No. | 0694546 |
Date | June 2023 |
Version | 1.0 |
Author | Jeanne Fourie |
Client Name | Absa Bank Botswana Limited |
Document history
ERM approval to issue | ||||||
Version | Revision | Author | Reviewed by | Name | Date | Comments |
Final SPO | 1.0 | Name | Name | Name | 30 June 2023 | |
Report | ||||||
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Signature Page
June 2023
Second-Party Opinion
Second-Party Opinion on Sustainable Finance Issuance Framework 2023
Name: Joseph Rohm
Job title: Partner
ERM SA Pty Ltd
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© Copyright 2023 by ERM Worldwide Group Ltd and/or its affiliates ("ERM").
All rights reserved. No part of this work may be reproduced or transmitted in any form, or by any means, without the prior written permission of ERM .
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C:Usersjeanne.fourieDocumentsABSAABSA SPO reportsERM_ABSA Botswana_SPO Report_June 2023.docx
SECOND-PARTY OPINION
Second-Party Opinion on Sustainable Finance Issuance Framework 2023
CONTENTS | ||||
2 | SECOND PARTY OPINION SUMMARY | 3 | ||
3 | SUSTAINABLE FINANCE FRAMEWORK ASSESSMENT | 6 | ||
3.1 | Green Bond and Loan Principles | 6 | ||
3.1.1 | Use of Proceeds | 6 | ||
3.1.2 | Process for Project Evaluation and Selection | 6 | ||
3.1.3 | Management of proceeds | 7 | ||
3.1.4 | Reporting | 7 | ||
3.2 | Social Bond and Loan Principles | 7 | ||
3.2.1 | Use of proceeds | 7 | ||
3.2.2 | Process for project evaluation and selection | 8 | ||
3.2.3 | Management of proceeds | 8 | ||
3.2.4 | Reporting | 8 | ||
4 | CONCLUSIONS | .......................................................................................................... | 8 | |
4.1 | Consideration of KPIs | 9 | ||
4.2 | Bond Requirements | 9 | ||
4.3 | Reporting | ............................................................................................................................................... | 9 | |
4.4 | Verification | 9 | ||
5 | RECOMMENDATIONS | 9 | ||
5.1 | Framework Contents | 9 | ||
5.2 | Framework KPIs | 10 |
APPENDIX A GREEN BONDS INDEPENDENT EXTERNAL REVIEW FORM
APPENDIX B SOCIAL BONDS INDEPENDENT EXTERNAL REVIEW FORM
Acronyms and Abbreviations
Name | Description |
ABSA | Amalgamated Banks of South Africa |
ALCO | Asset Liability Committee |
ERM | Environmental Resource Management |
ICMA | International Capital Market Association |
KPI | Key Performance Indicator |
SFIF | Sustainable Finance Issuance Framework |
SAR | Sustainable Asset Register |
GBP | Green Bond Principles |
GLP | Green Loan Principles |
SBP | Social Bond Principles |
SLP | Social Loan Principles |
LMA | Loan Market Association |
UN SDG | United Nations Sustainable Development Goals |
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1 EXECUTIVE SUMMARY
1.1 Scope of Work
ERM was engaged by ABSA Bank Botswana Limited (herewith referred to as the "issuer" or "ABSA") to provide a second party assessment of the Sustainable Finance Issuance Framework (SFIF) to confirm the alignment of the components of the framework with the
relevant guiding standards' principles, particularly the ICMA green, social and sustainability
bond guidelines and LMA green and social loan principles.
Further to this, the main objective of the assessment is to provide a Second Party Opinion on the 13 Key Performance Indicators included in the framework, their appropriateness for the sustainable finance-linked instruments, and whether performance against these targets could be monitored over the finance tenure.
The SFIF was assessed against the principles and taxonomy of the following suggested standards:
- ICMA Green Bond Principles (GBP) 2021
- ICMA Social Bond Principles (SBP) 2021
- ICMA Sustainability Bond Guidelines (SBG) 2021
- LMA Green Loan Principles (GLP) 2021
- LMA Social Loan Principles (SLP) 2021
To formulate a sound opinion, ERM completed the assessment in two distinct phases, which have been designed to meet the requirements of the ICMA and LMA standards:
- Independent review of the SFIF.; and
- Verification and Opinion of the SFIF against the four key pillars of the ICMA green, social and sustainability bond guidelines and LMA green and social loan principles:
- Use of Proceeds
- Process for Project Evaluation and Selection
- Management of Proceeds
- Reporting
The Client representatives have confirmed that they understand that it is the responsibility of the Client to provide ERM with all relevant information and ensure that the information provided is complete, accurate, and up to date.
1.2 Limitations of the Engagement
ERM has several disclaimers on the limitation of the engagement as below:
- ERM gives opinions on the alignment of the key principles as set out in ABSA's SFIF with the ICMA Social and Green and the LMA Social and Green Loan Principles, by relying on the provided materials and engagement responses by ABSA during the agreed timeline.
- While the SPO reports on current industry standards, it does not warrant alignment with future relevant industry standards.
- Regulatory developments and changes to the ICMA Green and Social Bond Principles and LMA Green and Social Loan Principles may be implemented in future versions of the ABSA framework. Any future version of this framework will either keep or improve the current levels of transparency and reporting disclosures,
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ABSA Bank Botswana Ltd. published this content on 14 September 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 14 September 2023 13:54:07 UTC.
