In consultation with the Bondholder Stewardship working group, IIGCC responded to two FCA Engagement Papers:
Engagement Paper 1 – Admission to Trading on a Regulated Market
Engagement Paper 4 – Non Equities Securities
The response primarily focuses on Engagement Paper 4. We emphasise the importance of green, social or sustainability labelled debt instruments (GSS+) to the net zero transition. We support the FCA’s proposals for enhanced disclosure requirement on the connection between the bond prospectus, bond framework and the company’s net zero transition plans. This includes specific disclosures for Use of Proceeds bonds and Sustainability-Linked bonds, recognising the differences between the two instruments.
On Engagement Paper 1, we also support enhanced ESG disclosure for non-labelled bond to facilitate the incorporation of climate into investors’ decision-making and stewardship in the credit space.
We look forward to further conversations between the working group and the FCA.