Sustainable Finance Pioneers: Far East New Century and CHIMEI Corporation First to Obtain SLB Accreditations
Following the launch of the Sustainability-Linked Bond (SLB) mechanism by the Taipei Exchange on 8 July this year, Far East New Century and CHIMEI Corporation were the first issuers to be granted SLB accreditations on 27 July.
According to the Far Eastern New Century SLB Framework, Far Eastern New Century is committed to building a circular economy and its sustainability blueprint is linked to the United Nations Sustainable Development Goals (SDGs), which include strategies such as "Enabling Unlimited Innovation" and "Navigating a Green Future". The key sustainability
indicators (KPIs) selected in the Far East New Century SLB framework include greenhouse gas reduction, green product revenue growth and increased recycled polyester (rPET) production capacity. With the SLB, Far Eastern New Century expects to expand the goals and scope of its sustainability initiatives to create a sustainable new century. The SLB plan of CHIMEI Corporation states that with the core objective of "Well-Being Through Contribution", CHIMEI has incorporated green production, green energy and green initiatives into its sustainability strategy and established a new business model using environmentally friendly innovative materials. CHIMEI SLB Framework includes greenhouse gas reduction and increased use of recycled water as KPIs, offering investors the opportunity to participate in a sustainable revolution in the plastics industry and join hands in the low-carbon transformation.
According to the Taipei Exchange, the SLB frameworks of the Far Eastern New Century and CHIMEI have been reviewed by Ernst & Young and are in line with Taipei Exchange Operation Directions for Sustainable Bonds as well as the ICMA Sustainability-Linked Bond Principles. After the issuance of SLBs, issuers should publicly disclose the latest performance
of their KPIs at least once a year, and the relevant data should be verified by assessment agencies, thus making it very convenient for investors to track the sustainability performance of issuers. In addition, SLBs are bonds that link corporate sustainability objectives to bond principal and interest payment terms, so investing in SLBs is not only a demonstration of responsible investment but also a concrete action to directly support the sustainable transformation of the real economy.
The Taipei Exchange pointed out that the SLB is one of the most popular new instruments in the international sustainable bond market recently. It is designed to help issuers raise funds from sustainable finance markets by linking sustainability objectives to bond principal and interest payment terms. Through the new mechanism, the Taipei Exchange is looking forward to further leveraging financial impact to help domestic enterprises move towards sustainable development and net-zero carbon emissions, as well as providing investors with more diversified ESG investment options. For more information on the SLB mechanism, please refer to the Taipei Exchange Sustainable Bond Information Portal (www.tpex.org.tw/web/bond/sustainability).