CLIMATE BONDS STANDARD

The Climate Bonds Standard version 4.3 provides a science-based framework for certifying climate-aligned investments. It covers four primary certification paths: Use of Proceeds (UoP) debt instruments, specific assets, non-financial legal entities, and sustainability-linked debt (SLD). The standard mandates independent verification by approved verifiers and requires adherence to sector-specific criteria. For entity and SLD certifications, the framework emphasizes absolute transition pathways over relative benchmarking, requiring ambitious climate mitigation performance targets (CMPTs) and robust transition plans. Additionally, the standard includes a specialized certification for agri-food entities focusing on deforestation- and conversion-free sourcing.

• The Standard provides four distinct certification pathways: Use of Proceeds (UoP) debt instruments, where funds are allocated to specific projects; Asset Certification for the environmental credentials of specific projects or activities; Entity Certification for non-financial legal entities with aligned transition plans; and Sustainability-linked debt (SLD) instruments linked to climate mitigation performance targets.
• For Use of Proceeds (UoP) certifications, issuers must allocate at least 95% of net proceeds to projects and assets that meet the Climate Bonds Sector Criteria. A 'flexibility pocket' of up to 5% may be used for projects that do not fully satisfy the Sector Criteria, provided they align with ICMA Green or Social Bond Principles and avoid excluded activities such as fossil fuel exploration or high-carbon stock land conversion.
• Entity and SLD certifications require that at least 90% of the certified entity's or the instrument's represented economic activities are 'compliant activities'. Compliance is determined by weighting activities according to their revenue share or share of greenhouse gas (GHG) emissions.
• Entity and SLD certifications are divided into two levels based on the timing of alignment with Sector Criteria: Level 1 (Aligned), where targets align at the time of certification, and Level 2 (Transition), where targets must align by 31 December 2030.
• A credible transition plan for certified entities must include Paris-aligned climate mitigation performance targets (CMPTs), a delivery strategy (including a vision, strategic narrative, and finance plan), governance mechanisms with board-level responsibility, and public disclosure.
• Parent groups of certified entities must adhere to specific climate safeguards, including a public commitment to no expansion of fossil fuel activities after 1 January 2023, a commitment to avoid conversion of high-carbon stock land since 1 January 2020, and a public net-zero emissions commitment covering all material scope 1, 2, and 3 emissions.
• Research and development (R&D) expenditure is eligible for UoP certification if it targets the substantial reduction, avoidance, or removal of GHG emissions and has demonstrated a Technology Readiness Level (TRL) of 6 or higher. Expenditure for TRLs 1-5 is eligible if it aims to reach TRL 6.
• The standard includes a specific certification for agri-food entities focusing on deforestation- and conversion-free (DCF) sourcing. This requires a commitment to ensure supply chains only include commodities produced on land not subject to deforestation or conversion of natural ecosystems after 31 December 2020.

APA

Climate Bonds Initiative (2025). CLIMATE BONDS STANDARD. https://www.climatebonds.net/files/documents/CBI_Standard_V4.3_FINAL_2025-08-20-102147_gbqn.pdf

Chicago

Climate Bonds Initiative. CLIMATE BONDS STANDARD. 2025. https://www.climatebonds.net/files/documents/CBI_Standard_V4.3_FINAL_2025-08-20-102147_gbqn.pdf.

Wikipedia

{{cite report |author=Climate Bonds Initiative |title=CLIMATE BONDS STANDARD |date=August 2025 |url=https://www.climatebonds.net/files/documents/CBI_Standard_V4.3_FINAL_2025-08-20-102147_gbqn.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatebondsinitiative2025climate, author = {{Climate Bonds Initiative}}, title = {{CLIMATE BONDS STANDARD}}, institution = {Climate Bonds Initiative}, year = {2025}, month = aug, url = {https://www.climatebonds.net/files/documents/CBI_Standard_V4.3_FINAL_2025-08-20-102147_gbqn.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }