Alphabet issued $5.75bn sustainability bonds, the largest issued by a corporation to date

5 Aug, 2020 20:35
source: Singularity Financial

Singularity Financial Hong Kong August 5, 2020 – Google’s parent company Alphabet Inc. has issued $5.75bn (£4.4bn) in sustainability bonds, in what it claims is the largest sustainability or green bond issued by a corporation to date.

For projects to receive support from the bond, they must fall into one of the eight priority categories identified by Alphabet: energy efficiency, renewable energy, green buildings, clean transport, circular economy and design, affordable housing, racial equality, and support for small businesses in the wake of Covid-19.

On energy efficiency and renewable energy, Google has made strides in improving the energy efficiency of its data centres in recent years and claims they are now twice as energy-efficient as typical enterprise data centres. It has been matching its total annual energy consumption with renewables since 2017 and last September signed a package of 18 wind and solar deals.

The clean transport projects will help Google integrate electric vehicles (EVs) and cargo bikes into its global fleet, following successful pilots in California’s San Francisco Bay; while the circular economy and design funding will be used to accelerate progress towards Google’s recycled content and recyclable devices targets.

Alphabet said in a statement that it will follow the Green Bond Principles and Social Bond Principles to ensure that the projects financed by the bond package deliver meaningful impacts. The firm will report annually on the projects that have been funded from the bonds’ proceeds, as well as their impact to date and expected future impact.

“Sustainability bonds are an emerging asset class and we hope this transaction will help develop this new market,” Alphabet’s chief financial officer Ruth Porat said.

“The proceeds from these sustainability bonds will fund ongoing and new projects that are environmentally or socially responsible and enable investors to join us in tackling critical issues. We believe that these investments benefit our communities, employees and stakeholders, and are an important part of fulfilling Google’s mission and goal of creating value over the long term.”