Second-Party Opinions (SPOs) have an important role in debt capital markets transactions – that of providing reassurance of the issuance’s sustainability credential and mitigating the risk of greenwashing. In the world of green and sustainability linked bonds, SPOs are increasingly a requirement.
On 28 June 2021, the Impact Investing Institute and the Carbon Trust co-hosted a think-in where investors, SPO providers and industry stakeholders discussed the utility and impact of SPOs.
The session fostered a great discussion and debate on the value and role of SPOs, highlighting the varying needs of the different stakeholders. Discussion areas centred on:
- Where is the balance between providing true opinion versus providing an SPO in a quick, more commoditised fashion that is more comparable and standardised?
- How can SPOs focus on and communicate the impact and outcome being achieved, and provide the level of detail required for all stakeholders?
Views on the role of SPOs were broadly consistent across all participants, but highlighted some interesting maturity and geographical nuance.
Where next for SPOs? The Carbon Trust have drawn up a brief summary report covering the discussion in greater detail which is available to download below.