IOSCO publishes report on sustainable bond market
The International Organization of Securities Commissions (IOSCO) has published a report on the sustainable bond market through its Sustainable Finance Taskforce. Drawing on research, literature reviews, member surveys, and a roundtable discussion with the Organisation for Economic Co-operation and Development, the report incorporates input from a diverse range of international regulators, including representatives from the Ontario Securities Commission and the Financial Regulatory Authority of Egypt. The document charts the development of sustainable bonds over nearly two decades and notes that by 2024 the cumulative issuance of green, social, sustainability, and sustainability-linked bonds exceeded$US5.7trn. It distinguishes these instruments from traditional bonds by examining differing funding mechanisms—such as use-of-proceeds bonds, sustainability-linked bonds, and transition bonds—and by highlighting their unique characteristics and associated risks. The report further outlines regulatory considerations aimed at mitigating market risks and enhancing investor protection.