HSBC approaches sustainable finance on a different canvas to everyone else. All houses can highlight great environmental, social and governance deals by now, but HSBC doesn’t just want to tell you about a green bond or a sustainability financing. It wants to talk about shaping policy with assistance to governments and regulators; about how sustainable finance goes all the way through its banking offering to trade finance and cash management, to sustainability-linked interest rate swaps and recycled PVC credit cards.
Consequently, HSBC takes this award for a fifth time.
Naturally, innovative deals are important: examples in our review period included Bangladesh’s first social principles-aligned loan, Malaysia’s first green trade financing in cocoa sourcing, Australia’s first sustainability-linked loan in the metals and mining industry for South32, India’s first skills impact bond and a social loan for Indonesia’s first national telecommunications public-private purchasing satellite project.
The South32 deal in particular showed HSBC’s stomach for the fight: the climate battle won’t be won just by financing wind farms and solar, but by taking polluters and bringing them on a gradual journey from brown to green.
Equally important is HSBC’s sense of partnership around the world. It launched a debt platform with Temasek to catalyze the financing of marginally bankable sustainable infrastructure projects in Asia, for example, and led the Fast-Infra initiative with the IFC, OECD and World Bank to launch the Sustainable Infrastructure Label for infrastructure assets. It developed a blueprint for a mangrove bond with Earth Security in Australia, traded the first ESG-KPI-linked FX swap with seafood leader Thai Union, and partnered with the ADB to provide $300 million of financing to help Asia’s supply chains boost manufacturing capacity for Covid-19 vaccines.
Society is off track, climate change is real. As a team we are trying, deal by deal, to drive change
Jonathan Drew
It is because of this leadership that HSBC is sought by regulators and industry bodies. Among other things it chairs the green and sustainable loan committee at the Asia Pacific Loan Market Association, and is either a chair or a member of key green and sustainability committees from Apec and Asean to the central banks of Singapore, Hong Kong, China, Malaysia, Thailand and India.
In the last year, HSBC has had to face down challenges ranging from a greenwashing debate about a financing for Hong Kong’s airport, to ill-judged remarks by a senior member of staff at a London conference. None of these things dilute the work HSBC continues to lead in sustainable finance.
“Society is off track, climate change is real,” says Jonathan Drew, who leads the bank’s effort. “As a team we are trying, deal by deal, to drive change.”
