CLIMATE BONDS STANDARD

The Climate Bonds Standard version 4.1 provides a science-based framework for certifying Use of Proceeds (UoP) debt instruments, physical assets, non-financial legal entities, and sustainability-linked debt (SLD). Certification requires alignment with sector-specific criteria and independent verification by Approved Verifiers. For entities and SLDs, the standard emphasizes 'Hallmarks' of a credibly transitioning company, including Paris-aligned targets, robust transition plans, and public disclosure. The framework includes strict exclusions for the parent group regarding fossil fuel expansion and high-carbon-stock land conversion.

• The Climate Bonds Standard version 4.1 expands its certification scope beyond Use of Proceeds (UoPs) debt instruments to include assets, non-financial legal entities, and sustainability-linked debt (SLD) instruments.
• For Use of Proceeds certification, at least 95% of net proceeds must be allocated to projects and assets that meet the Standard's Sector Criteria.
• The Standard allows a 5% flexibility pocket for projects that do not fully satisfy Sector Criteria, provided they relate to sectors without developed criteria, align with ICMA Green/Social Bond principles, and do not involve excluded activities such as fossil fuel extraction or natural gas production.
• Entity Certification is limited to non-financial entities or segments thereof and requires that at least 90% of the entity's economic activities (weighted by revenue or GHG emissions) are 'Compliant Activities' meeting performance, strategy, governance, and disclosure requirements.
• Entity and SLD certifications are categorized into two levels: Level 1 ('Aligned'), where targets meet Sector Criteria at the time of certification, and Level 2 ('Transition'), where targets must align by December 31, 2030.
• Certification for entities and SLDs is based on five 'Hallmarks' of a credibly transitioning company: Paris-aligned targets, robust plans, implementation action, internal monitoring, and external reporting.
• Parent Groups of certified entities or SLD issuers must adhere to strict climate safeguards, including a public commitment to no expansion of fossil fuel activities after January 1, 2023, and no conversion of high-carbon-stock land since January 1, 2020.
• All certifications require mandatory verification by an 'Approved Verifier' who must issue a verification report with an unqualified opinion regarding compliance with the Standard and Sector Criteria.
• Eligible R&D expenditure is permitted if the technology has demonstrated the ability to substantially reduce, remove, or avoid GHG emissions at Technology Readiness Level (TRL) 6 or higher.

APA

Climate Bonds Initiative (2024). CLIMATE BONDS STANDARD. https://www.climatebonds.net/files/documents/Climate-Bonds_Climate-Bonds-Standard_V4-1_Feb-2024.pdf

Chicago

Climate Bonds Initiative. CLIMATE BONDS STANDARD. 2024. https://www.climatebonds.net/files/documents/Climate-Bonds_Climate-Bonds-Standard_V4-1_Feb-2024.pdf.

Wikipedia

{{cite report |author=Climate Bonds Initiative |title=CLIMATE BONDS STANDARD |date=February 2024 |url=https://www.climatebonds.net/files/documents/Climate-Bonds_Climate-Bonds-Standard_V4-1_Feb-2024.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatebondsinitiative2024climate, author = {{Climate Bonds Initiative}}, title = {{CLIMATE BONDS STANDARD}}, institution = {Climate Bonds Initiative}, year = {2024}, month = feb, url = {https://www.climatebonds.net/files/documents/Climate-Bonds_Climate-Bonds-Standard_V4-1_Feb-2024.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }