Sustainable Debt - Market Trends, Opportunities & Challenges

The total value of ESG-compliant assets is expected to reach USD 53 trillion by 2025—a third of total assets under management. From the initial interest in sustainable investing, which focused on public equity markets, an ESG-labeled fixed income market of increasing maturity has evolved.

More and more issuers and investors are looking closely at sustainable debt, and there have been substantial flows into sustainable investment–grade and high-yield strategies recently. This rapid growth in the market for sustainable debt raises several questions: Why could sustainable debt be the key financial instrument for improving firms' sustainability? How has the market for sustainable debt evolved and where is it now? What are the effects of sustainable debt on the financial and environmental performance of issuing firms? How do we prevent greenwashing? In what ways can the market standardize ESG products and improve transparency? Who pays for improvements in sustainability performance, issuers or investors?

This Master Class is offered by the Swiss Finance Institute in cooperation with the Geneva Financial Center .

Registration is mandatory

Co-Leaders :

• Prof. Erwan Morellec, SFI Senior Chair, Head of SFI PhD Program, EPFL
• Mark Keller, Director ESG Advisory, UBS Investment Bank

The specific objectives are:

Building on industry practice and recent academic insights, this Master Class provides participants with an in-depth understanding of sustainable debt. Using the latest available data, the co-presenters discuss implementation approaches and both the opportunities and the shortcomings of current practice. Overall, the Master Class aims to equip banking and finance professionals with up-to-date, relevant, high-level knowledge about sustainable debt.

• Becoming familiar with the institutional details of sustainable debt structures and getting up to speed with recent trends in the sustainable debt market.
• Examining the effects of sustainable debt—from green and social bonds to sustainability-linked loans—and the financial and sustainability performance of issuers and borrowers.
• Understanding the differences and trade-offs in the use of proceeds and sustainability-linked structures and how the design of sustainable debt can help prevent greenwashing.
• Investigating who pays for sustainability, and understanding the ESG ratings landscape.
• Analyzing best-in-class approaches to ESG reporting and the need for transparency.
• Understanding, through a case study, the potential for issuing sustainable debt.

SFI Master Class Features and Target Audience

SFI Master Classes offer seasoned banking and finance professionals a unique opportunity to exchange knowledge and share their professional views with top-level academics and industry experts in an interactive learning environment. Master Classes incorporate hands-on group work and opportunities for discussion. An on-site networking event will follow this Master Class.

This particular Master Class is aimed at corporate finance (M&A, credit finance and loans, capital market finance, financing of firms and projects), investment banking, and asset management professionals. The focus is on enabling participants to understand the evolving market for sustainable debt.

This SFI Master Class is an acknowledged SAQ recertification measure and comprises four learning hours for the following SAQ profiles: 

• Wealth Management Advisor CWMA
• Advisor Affluent Clients
• Advisor Individual Clients
• Certified Corporate Banker CCoB
• Advisor SME Clients

This SFI Master Class covers the aspect "industry knowledge".