CLIMATE BONDS STANDARD

The Climate Bonds Standard version 4.2 (CBS v4.2) is a voluntary labelling scheme designed to certify debt instruments, assets, and non-financial legal entities to ensure they are consistent with the goals of the Paris Agreement. It provides a science-based framework and sector-specific criteria to mobilise global capital for climate action through four primary certification pathways: Use of Proceeds (UoP), Asset, Entity, and Sustainability-Linked Debt (SLD).

• The Standard provides four distinct certification categories: Use of Proceeds (UoP) debt instruments, specific assets or projects, non-financial legal entities, and sustainability-linked debt (SLD) instruments issued by non-financial legal entities.
• For Use of Proceeds (UoP) certifications, at least 95% of the net proceeds must be allocated to projects and assets that meet the Standard's Sector Criteria.
• Entity Certification is available to non-financial entities where at least 90% of their economic activities—weighted by revenue share or GHG emissions—comply with climate performance, delivery strategy, governance, and disclosure requirements.
• Entity and SLD certifications are divided into two levels: 'Level 1 – Aligned' for those meeting Sector Criteria at the time of certification, and 'Level 2 – Transition' for those that align by December 31, 2030.
• Certification for entities and SLDs requires a transition plan featuring climate mitigation performance targets (CMPTs) that span from the certification date to net-zero emissions or 2050, whichever is sooner.
• Parent groups of certified entities must adhere to specific climate safeguards, including a public commitment to no expansion of fossil fuel activities (such as natural gas production or crude oil refining) after January 1, 2023.
• The Standard includes a specialized certification for agri-food entities focusing on deforestation- and conversion-free (DCF) sourcing, requiring that supply chains only include commodities from land not subject to deforestation or natural ecosystem conversion after December 31, 2020.
• Mandatory verification must be conducted by 'approved verifiers'—independent third-party firms that follow international standards such as ISAE3000 and guidelines from ICMA and LMA.
• Research and development (R&D) expenditure is eligible for UoP certification if it targets substantial GHG reduction and reaches Technology Readiness Level (TRL) 6 or higher, or is aimed at reaching TRL 6.
• To maintain certification, UoP issuers must submit annual update reports containing allocation and eligibility reporting, and are encouraged to provide impact reporting.

APA

Climate Bonds Initiative (2024). CLIMATE BONDS STANDARD. https://www.climatebonds.net/files/documents/Climate-Bonds_Standard-version-4.2_Jun-2024.pdf

Chicago

Climate Bonds Initiative. CLIMATE BONDS STANDARD. 2024. https://www.climatebonds.net/files/documents/Climate-Bonds_Standard-version-4.2_Jun-2024.pdf.

Wikipedia

{{cite report |author=Climate Bonds Initiative |title=CLIMATE BONDS STANDARD |date=June 2024 |url=https://www.climatebonds.net/files/documents/Climate-Bonds_Standard-version-4.2_Jun-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 = jun, url = {https://www.climatebonds.net/files/documents/Climate-Bonds_Standard-version-4.2_Jun-2024.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }