[Monthly Report] ICMA Unveils Practitioner’s Guide on Sustainable Bonds for Nature, alongside updates to existing guidance, Injecting New Vitality into Sustainable Finance Market

On June 26, 2025, the International Capital Market Association (ICMA) officially released the Sustainable Bonds for Nature: A Practitioner’s Guide (hereinafter referred to as the Guide) at the annual general meeting of the Green, Social and Sustainability-Linked Bond Principles (collectively referred to as the Principles), alongside announcing significant updates to existing guidance documents, injecting new vitality and regulatory clarity into the global sustainable finance market.

Background

Against the backdrop of escalating environmental challenges, biodiversity loss and ecosystem degradation pose severe threats to the global economy, society, and human well-being. Against this backdrop, the sustainable bond market, a key financing source for supporting sustainable development and climate transition, has reached a scale of US$6 trillion. However, despite existing sustainable bond principles, specialized guidance for nature-themed bonds has long been inadequate. The Guide issued by ICMA seeks to provide a clear framework for public and private sector issuers to finance nature-related projects, and facilitate synergies between ecological conservation and economic development by filling gaps in the nature bond standard system.

Core Content

Definition and Scope of Nature-themed Bonds

Nature-themed bonds are typically UoPs bonds such as green bonds or sustainability bonds (for a combination of green and social projects) aligned to the four core components of the GBP. Issuers of green bonds fully allocated to nature-related projects may adopt a secondary "Nature Bond" designation to differentiate their offerings and highlight the uniqueness of fund allocation. Additionally, Sustainability-linked bonds (SLBs) are another instrument for biodiversity protection. By setting nature-related Key Performance Indicators (KPIs), the terms of the bonds can be linked to these nature-related KPIs.

Nature-related Project Categories and Impact Reporting Metrics

The appendix details s an indicative list of nature-related projects under the 10 eligible green project categories of GBP, providing issuers with a comprehensive reference for project screening. All projects classified as eligible for a nature-themed bond in line with the Guidance should report on at least one relevant impact indicator. The appendix provides a list of relevant impact reporting metrics, enhancing transparency and credibility.

SLBs with a focus on Nature

SLBs feature general-purpose proceeds, with core focus on selecting material KPIs for issuers and setting ambitious targets. This allows issuers of nature-themed SLBs to incorporate nature-related KPIs, significantly expanding SLB applications in nature conservation. Issuers may reference KPIs recommended in the Illustrative KPIs Registry for Sustainability-Linked Bonds or other nature-related metrics.

Market Impacts

For Issuers: leverage the Guideline’s project classification and KPI framework to precisely screen compliant projects and enhance bond competitiveness when planning nature-themed bond projects;

For Investors: the release of the Guideline has made information on nature-themed bond projects more transparent and standardized, further promoting the flow of capital into sustainable development areas related to nature conservation.

For Market Ecosystem: drive innovation in nature-themed bond products and foster the development of third-party assessment standards, refining market infrastructure.

Other Key Updates

ICMA has simultaneously released various guidance documents and updates that complement existing publications, specifically, including:

•      An update of the Green Bond Principles with a clear reference to the Green Enabling Projects Guidance and an extension of the definition of Green Projects to include “activities” (this second point being also mirrored in the Social Bond Principles).
•       A new Example Checklist to provide support to users in demonstrating how their projects align with the Green Enabling Projects Guidance document. It contains illustrative examples and counterexamples for four out of the five sectors listed in the Guidance.
•       Dedicated FAQs added as an annex to both the Guidelines for Sustainability-Linked Loans financing Bonds (SLLBs) and the Guidance for Green Enabling Projects, originally published in June 2024.
•      Additional impact reporting metrics and sector specific guidance concerning Access to essential services, as well as a new annex regarding Potential Environmental and/or Social Risks Associated with Eligible Project Categories included in the Harmonised Framework for Impact Reporting for Social Bonds.
•       An expansion of the SLB Illustrative KPIs Registry, related to environmental and social themes as well as additional KPIs for sovereign issuers and a revision of the definition of secondary KPIs.
•       A single document integrating all guidance on allocation reporting, the Guidance on Allocation Reporting, to facilitate its understanding and application.

Reference Resources

1、 The Executive Committee of the Principles announces a Practitioner’s Guide on Sustainable Bonds for Nature, alongside updates to existing guidance: https://www.icmagroup.org/News/news-in-brief/the-executive-committee-of-the-principles-announces-a-practitioners-guide-on-sustainable-bonds-for-nature-alongside-updates-to-existing-guidance/

2、 【专业动态】重磅更新—— ICMA发布《关于自然主题的可持续发展债券发行实践指南》并更新现有指引文件：https://mp.weixin.qq.com/s/7BPf2JrZvWjj-3DJ31llBw