S&P Global Ratings has published a second party alignment opinion for Link REIT’s (Link) Sustainable Finance Framework. Based in Hong Kong, Link is a retail-focused real estate investment trust and as of 30 September 2021, its portfolio consisted of a gross floor area of 4.8 million square meters across 143 properties in areas including retail, offices, car parks, logistics, and other assets. According to S&P, Link’s sustainable finance framework is aligned with the Social Bond Principles (SBP), the Social Loan Principles (SLP), the Green Bond Principles (GBP), the Green Loan Principles (GLP), and the Sustainability Bond Guidelines (SBG).
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Link REIT’s Sustainable Finance Framework
- Link’s use of proceeds was found to be “strong”. The company commits to using the net proceeds of financing instruments exclusively for eligible green and social projects. Eligible green project categories include green buildings, energy efficiency, renewable energy, pollution prevention and control, climate change adaption, clean transportation, and sustainable water and wastewater management.
- The company’s process for project evaluation and selection was found to be “aligned” with the applicable principles, as Link’s sustainable finance framework outlines the process for ensuring projects meet eligibility criteria. The company’s sustainability committee is responsible for project screening and evaluation, while identifying and managing potential environmental and social risks under the guideline of Link’s group risk management framework.
- Link commits to depositing the net proceeds from financing instruments in a general funding account and to maintaining a register to track and monitor allocation of proceeds. The company will also hold unallocated proceeds in accordance with its liquidity guidelines and will not invest these funds in projects that conflict with the eligibility criteria specified within the framework.
- Link’s reporting was also found to be “aligned”, as Link commits to reporting on allocation and impact reporting at least annually until the full proceeds allocation. The company will disclose these elements in its annual integrated report and on its corporate website.
