ESG has surged in importance as a financing theme in Latin America over the past 12 months. Financial institutions of all sizes and types have been scrambling to emphasize how the components of ESG are now core to business strategy. It’s often hard to see through the messaging, but that’s not the case with Santander. The bank is truly a leader in embedding sustainable finance in the business. Its group executive chairman Ana Botín has championed the bank’s net-zero carbon ambitions, but it’s under the leadership of Santander’s group chief executive, Jose Antonio Álvarez, that the bank has become a sustainability leader in Latin America.
Many of the sustainable initiatives are global but have particular resonance in this region. For example, the bank’s expansion in micro-finance, which has a particular focus on supporting female entrepreneurs, has had a strong impact. In Mexico, Santander corporate and investment banking (SCIB) was also joint lead manager and bookrunner for the country’s first ever gender bond, financing a portfolio of new and existing loans targeting women as beneficiaries in financial inclusion, employment and entrepreneurship. Meanwhile, Santander Chile issued that country’s first bond with sustainable criteria to finance female-operated SMEs.
The bank has also made strides with its green finance agenda. In the past year SCIB was bookrunner on the first sustainability-linked bond in Brazil (and second globally) for pulp and paper producer Suzano. It also led on the Republic of Chile’s $2.1 billion-equivalent social bond – the first ESG bond issued in local currency by a Latin American issuer.
Santander also led the placement of Argentina’s first sustainable bond, requiring environmental and social performance certification. It took the structure into the private sector when it was mandated to be sustainability bond structuring agent and bookrunner in Banco Continental de Paraguay’s inaugural sustainability bond – the first such deal issued by a Latin American bank with international distribution.
