Industry super fund commits to green bonds

An $11 billion industry superannuation fund is a founding signatory to the Green Bond Pledge.

Local Government Super (LGS), the industry fund for NSW local government employees joined the US state treasuries of California, New Mexico and Rhode Island and the cities of Asheville, San Francisco and King County as founding signatories to the Green Bond Pledge.

The pledge is set to see LGS declare that all bonds financing long-term infrastructure and capital projects will address environmental impacts and climate risks.

For cities, county and state governments and corporations, the pledge requires they account for climate risk when designing future infrastructure and capital projects and consider green bonds as the means for finance.

Jointly developed by international climate finance and sustainability groups - including the Climate Bonds Initiative - the pledge aims to reinforce goals of the Paris Agreement, and is based on the premise that public and private sector bonds financing long-term clean infrastructure need to incorporate mitigation adaption and resilience to climate impacts.

Climate Bonds Initiative chief executive Sean Kidney said green finance was now a critical area for the mainstreaming of climate action.

"The foundation signatories are to be congratulated," Kidney said.

"By signing the Pledge they are opening another path for much needed linkage between sub-nationals and corporate climate goals and their financial balance sheets and investment plans."

The move follows LGS awarding a $440 million fixed income mandate to PIMCO late last month, with roughly 15% of the mandate set to be invested in green bonds.

Read more: Green Bond PledgeLGSClimate Bonds InitiativeSean KidneyLocal Government SuperParis AgreementPIMCO
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