Western Europe’s best bank for sustainable finance 2021: BNP Paribas
As well as winning the best bank and best bank for financing awards, BNP Paribas is also western Europe’s best bank for sustainable finance.
A green bubble has been inflating in Europe, with some banks seeking market share and some issuers looking for discounted terms by selling green and sustainability-linked bonds without fully constructing a sustainability or transition plan for their businesses.
As well as topping the league tables in sustainably-linked bonds and loans, BNP Paribas, under chief executive Jean-Laurent Bonnafé, leads with conviction in a complex area for issuers, investors and banks. The bank played a lead role in developing the Paris Agreement Capital Transition Assessment methodology to help banks decarbonize their loan books. It was also a founder member of the Net Zero Banking Alliance.
“We are trying to be a standard setter and an innovator in all products across sustainable bonds, social impact bonds, blended finance and helping our borrowers set ambitious transition targets,” says Antoine Sire, head of company engagement BNP Paribas Group. “At BNP Paribas, this is not a separate sustainability or transition practice. It is embedded and integrated at all levels of the company including in governance.”
In 2020 the bank announced a total exit of the coal value chain by 2030 in EU and OECD countries and by 2040 in the rest of the world. As a result, the group has begun to end relationships with half of its power production clients that had no transition plans to phase out coal. The impact on revenues will be counted in many tens of millions of euros.
For companies that are planning to transition, BNP Paribas has been busy. It was sole structuring adviser and sole global coordinator for the first ever €650 million convertible sustainability-linked bond issued by Schneider Electric. As well as CO₂ emissions, the key performance indicators target gender diversity in management positions and education access.
BNP Paribas was joint structuring adviser and joint bookrunner on the inaugural sustainability-liked bond deal for Chanel – a first in the luxury sector linked to the ICMA sustainability-linked bonds principles and also a first from an unrated issuer. Targets include not just reducing the company’s own scope 1 and 2 emissions by 50% by 2030 but also reducing scope 3 emissions through its supply chain by 10%, as well as shifting to 100% renewable electricity by 2025.