In 2022, the Qatar Financial Centre (QFC) developed a Sustainable Sukuk and Bonds Framework, which is based on the International Capital Markets Association (ICMA)’s Green Bond Principles (GBP) 2021, Social Bond Principles (SBP) 2021, and Sustainability Bond Guidelines (SBG) 2021. This framework would collectively, provide voluntary yet internationally accepted principles and guidelines for the issuance of such instruments.
The proceeds from any Sukuk / bonds must always be utilized solely for purposes that are aligned with the type of issuance (i.e. Green, Social or Sustainability) and provide clear environmental and/or social benefits.
The net proceeds from an issuance, can be used by way of investment in, financing and/or refinancing of eligible green and/or social projects. Examples of eligible green projects include:
(a) Climate Change Adaptation or Mitigation (including efforts to make infrastructure more resilient to impacts of climate change, as well as information support systems, such as climate observation and early warning systems).
(b) Pollution Prevention and Control (including reduction of air emissions, greenhouse gas control, soil remediation, waste prevention, waste reduction, waste recycling and energy/ emission-efficient waste to energy).
(c) Renewable Energy (including production, transmission, appliances and products).
(d) Sustainable Water and Wastewater Management (including sustainable infrastructure for clean and/or drinking water, wastewater treatment, sustainable urban drainage systems and river training and other forms of flooding mitigation).
(e) Energy Efficiency / Green Technology (such as in new and refurbished buildings, energy storage, district heating, smart grids, appliances and products).
(f) Circular Economy Adapted Products, Production Technologies, and Processes (such as the design and introduction of reusable, recyclable and refurbished materials, components, and products; circular tools and services).
(g) Clean Transportation (such as electric, hybrid, public, rail, non-motorized, multi-modal transportation, infrastructure for clean energy vehicles and reduction of harmful emissions).
(h) Green Buildings (that meet regional, national or internationally recognized standards or certifications for environmental performance or projects that reduce pollution, produce energy through renewable energy).
(i) Environmentally sustainable management of living natural resources and land use (including environmentally sustainable agriculture; environmentally sustainable animal husbandry; climate smart farm inputs such as biological crop protection or drip-irrigation; environmentally sustainable).
(j) Terrestrial and aquatic biodiversity conservation (including the protection of coastal, marine and watershed environments).
The QFC Sustainable Sukuk and Bonds Framework is a voluntary guideline that neither constitutes an offer to purchase or sell securities nor constitute specific advice of whatever form (tax, legal, environmental, accounting or regulatory) in respect of Green, Social or Sustainable Sukuk and Bonds or any other securities. Issuers opt to adopt and implement the framework voluntarily and independently.
