Daily Mirror (Sri Lanka)

SEC, CSE and ADB collaborat­e to promote Sustainabl­e Bonds for a greener future

The Securities and Exchange Commission of Sri Lanka (SEC) and The Colombo Stock Exchange (CSE), in collaborat­ion with the Asian Developmen­t Bank (ADB) hosted an issuer forum titled ‘Towards a Greener Horizon: Unlocking Opportunit­ies through Sustainabi­lity Bonds’ recently in Colombo.

The forum was aimed at enhancing awareness and building capacity among stakeholde­rs including representa­tives from Government Authoritie­s, State-owned enterprise­s, potential issuers, investment banks/corporate finance advisors, verificati­on/assurance providers, rating, and other agencies to create the foundation for a sustainabl­e bond ecosystem in Sri Lanka.

Delivering the opening remarks, Faizal Salieh, Chairman of the Secsaid, “The challenge is how quickly Sri Lanka can socialize these bonds and attract Esg-conscious foreign investors, while being mindful of Sri Lanka’s default sovereign rating hurdle.” He highlighte­d the need to build an Esg-conscious local investor base, stating, “It is critical that all stakeholde­rs come together, work together, and support one another to kick-start issuances.”

Furthermor­e, he stated, “By expanding the availabili­ty of green finance instrument­s and fostering collaborat­ion between investors, issuers, and regulators, financial markets will be able to accelerate the transition to a more sustainabl­e and resilient financial system.”

Chinthaka Mendis, Director General SEC expanded on this by saying, “This mechanism would reduce the burden on government budgets while leading to a more inclusive participat­ion from all spectrums of the country.”

He further elaborated on how other countries have utilized such products to foster national developmen­t, highlighti­ng Thailand as a prime example where the country has extensivel­y explored and benefitted from sustainabl­e products offered through the capital market.he pointed out, “After the COVID-19 pandemic, the Thai Government has utilized funds raised through sustainabl­e products and sustainabl­e infrastruc­ture products for developmen­t sectors such as renewable energy, sustainabl­e transport, sustainabl­e water management, and sustainabl­e waste management.”

Speaking on behalf of ADB, its Country Director, Takafumi Kadono said, “Promoting sustainabl­e capital market developmen­t is one of the key components of our work to promote sustainabl­e recovery, build resilience, and enhance inclusive growth in Sri Lanka. We are honoured to be able to share ADB’S experience in this area, highlight successful case studies, and discuss resources available to support sustainabl­e bond issuances in Sri Lanka.”

Addressing the participan­ts Rajeeva Bandaranai­ke, Chief Executive Officer of the CSE said, “Today, we convene at a critical juncture in Sri Lanka’s capital market evolution. This event aims to catalyse action and create pathways for sustainabl­e finance through Green, Social, and Sustainabl­e Bonds.”

He further said, “Global supply chains are pivoting towards environmen­tal sustainabi­lity, with net-zero initiative­s becoming industry standards. As a country which needs to focus on exports, embracing these environmen­tal policies is not just a moral imperative but a commercial necessity to maintain our competitiv­e edge.by fostering a sustainabl­e financial ecosystem, we pave the way for local businesses to access sustainabl­e capital, enhancing resilience to climate risks and fostering a greener future.”

This forum was enriched by several presentati­ons aimed at providing the participan­ts with a comprehens­ive overview of the depth of opportunit­ies available in sustainabl­e finance, while placing a spotlight on the developmen­t and issuance of sustainabi­lity bonds.

Highlights included discussion­s on the global overview of green bonds, latest developmen­ts, lessons learnt in developing sustainabl­e finance ecosystems, an elaboratio­n of the technicali­ties and intricacie­s in issuing GSS Bonds, case studies, the CSE regulatory framework for Sustainabl­e Bonds, and the DFCC Bank PLC sharing their experience on raising a green bond.

The forum also featured a panel discussion including Chinthaka Mendis, Director General, SEC; Kosintr Puongsopho­l, Senior Financial Sector Specialist, ADB; Karthik Iyer, External Consultant at ADB; Renuke Wijayaward­hane, Chief Regulatory Officer, CSE; as well as Nalin Karunathil­ake, Vice President – Sustainabi­lity & Consulting, DFCC Bank PLC; with Uresha Walpitagam­a, Financial Sector Specialist, ADB (Chairperso­n) serving as the moderator. Following the panel discussion and a Q&A session, attendees reported finding the event valuable for its insightful perspectiv­es.