JSE allows climate, sustainability bonds as ESG investment jumps

play article
Subscribers can listen to this article
Photo: Getty Images
Photo: Getty Images

JSE, which runs Africa’s biggest stock and bond exchanges, said it has changed its listing requirements to increase exposure to the rapidly growing environmental, social and governance investment sector and to allow the sale of bonds to raise funds to fight climate change. 

The changes will allow the listing of debt securities with pre-defined sustainability or ESG objectives, it said in a statement on Tuesday. The South African exchange operator will also cater for climate-related bonds, the proceeds of which will be used to combat climate change or to fund responses to rising temperatures, including cushioning coal-dependent communities from the financial impact of a transition to clean energy. 

To date, about $4 trillion worth of ESG-related debt has been sold globally, according to data collated by Bloomberg Intelligence, as concern grows about the warming climate, treatment of communities and equality in the workplace. Of the 108 stock exchanges tracked by the Sustainable Stock Exchanges Initiative, which partners with the United Nations, 40 have ESG bond segments, including Nasdaq and Euronext.

Climate change is increasingly in focus in South Africa, the world’s 12th-largest producer of greenhouse gases, with the president appointing an advisory panel on the issue, adopting a tougher emission reduction target and winning a pledge of $8.5 billion in climate finance from some of the world’s richest countries.

At the same time, the country has the world’s biggest divide between rich and poor, and companies are under pressure to improve their performance in dealing with social concerns. 

The JSE will set up two new segments to track the bonds: a Sustainability Segment and a Transition Segment.

- With assistance from Neil Chatterjee and Alastair Marsh.

We live in a world where facts and fiction get blurred
In times of uncertainty you need journalism you can trust. For 14 free days, you can have access to a world of in-depth analyses, investigative journalism, top opinions and a range of features. Journalism strengthens democracy. Invest in the future today. Thereafter you will be billed R75 per month. You can cancel anytime and if you cancel within 14 days you won't be billed. 
Subscribe to News24
Rand - Dollar
Rand - Pound
Rand - Euro
Rand - Aus dollar
Rand - Yen
Brent Crude
Top 40
All Share
Resource 10
Industrial 25
Financial 15
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Government tenders

Find public sector tender opportunities in South Africa here.

Government tenders
This portal provides access to information on all tenders made by all public sector organisations in all spheres of government.
Browse tenders