CHINASUSTAINABLE DEBT

STATE OF THE MARKET REPORT
2022

Published jointly by the Climate Bonds Initiative, China Central Depository & Clearing Research Centre(CCDC Research) and CIB Economic Research and Consulting (CIB Research)
Title bold: Subtitle bookFunding for this publication was provided
by the Standard Chartered Bank
as a Gold Partner.
1

Introduction
This is the seventh iteration of the China
Sustainable Debt State of the Market Report.
It describes the shape and size of the green,social, and sustainable (GSS) markets, plus
sustainability-linked bonds (SLBs), and transition
bonds, known as the GSS+ market. Data extends
to the end of 2022.
This report is co-produced by the Climate
Bonds Initiative (Climate Bonds), China Central
Depository & Clearing Research Centre (CCDC
Research Centre) and CIB Economic Researchand Consulting Co., Ltd. (CIB Research), withsupport from the Standard Chartered Bank.

Scope of analysis
This report explores five sustainable debt
themes based on the projects, activities,
and expenditures financed: green, social,sustainability, SLB, and transition.
Debt labels describe the types of projects,
activities, or expenditures financed, and/or
their benefits. Green, social, sustainability, andtransition are the most common labels, but abroad range of labels is used (see Appendix A)

Climate Bonds expands its
Certification Scheme to include
corporate entities and SLBs
Certification under the Climate Bonds Standard
v4 (CBS v4) has expanded beyond Use ofProceeds (UoP) bonds to include non-financial
corporates and their SLBs. Launched in Q1
2023, CBS v4 is a major new development
for Climate Bonds, which has driven credible
climate financing for over a decade. Drawing
from its experience in developing detailed sector
criteria for assets, activities and investments,
Climate Bonds can also provide transparent
science-based criteria for non-financial corporate
entities, credible SLBs and similar instruments,
and assurance for investors that sustainability
requirements have been met in respect of any
certified issuance.
This work goes beyond sectoral transition
pathways and includes key governance elementsthat indicate a company’s preparedness totransition to net zero. Certification will beavailable for corporates with emissions alreadynear zero as well those with activities in the

Table of Contents
Introduction 2
GSS+ market snapshot 3
Green 4
Transition 11
Social and sustainability 15
Outlook 18
Appendices 19
Endnotes 21

high emitting sectors, provided the corporate
has suitably ambitious performance targets
and credible transition plans. CBS v4 enables
corporates aligned with 1.5-degree pathways,
or those that will be aligned by 2030, to obtaincertification. SLBs issued by and in respect of theactivities of qualifying non-financial corporates
can also be certified under the CBS v4.

Sustainable fixed income market
Theme

Label

FormatGSS

Green

Use of proceeds

SocialUse of proceeds

Sustainability

Use of proceeds

Sustainability-linked

Entity KPI-linked

Transition

Use of proceeds

Transition

About the Climate
Bonds Initiative

About the CCDC
Research Centre

Climate Bonds Initiative is an internationalorganisation working to mobilise global capitalfor climate action. It promotes investmentin projects and assets needed for a rapidtransition to a low-carbon, climate-resilient,and fair economy. The mission focus is to help
drive down the cost of capital for large-scale
climate and infrastructure projects and tosupport governments seeking increased
capital markets investment to meet climate
and greenhouse gas (GHG) emission reduction
goals. Climate Bonds conducts market analysis
and policy research; undertakes market
development activities; advises governments
and regulators; and administers a global green
bond Standard and Certification scheme.

China Central Depository & Clearing Co.,
Ltd. (CCDC) formally established the CCDC
Research Centre in July 2017. CCDC ResearchCentre positions itself as a professional thinktank and focuses on filling in gaps in professional
fields. It conducts in-depth studies on prominentissues related to operations, regulations, andinfrastructure construction of bond and related
financial markets. It provides results that closely
combine theory and practicality and is dedicatedto building a CCDC research brand that integrates
research, publicity, and other services.

China Green Bond Market Report 2022 Climate Bonds Initiative

About the CIB Research
CIB Economic Research and Consulting Co.,Ltd (CIB Research) is a member institutionof the Industrial Bank. It is the first legallyindependent research company of the banking
system in China. It operates in accordancewith market-oriented mechanisms and lays
out three research blocks around strategy,
market, and industry, focusing on the macro
market, green finance, financial industry,currencies and commodities, fixed income,and various industrial sectors. It aims to serve
the high-quality development of China’s
economy as its mission and is guided by thefive development concepts of innovation,
coordination, greenness, openness and sharing.
It is committed to integrating professional
research into financial practice, contributing to
China’s economic transformation.

2

GSS+ Market Snapshot
China’s economic and social development
have underpinned the growth of a formidable
GSS+ debt market with unique characteristics.
This experience can support whole economy
transition by extending access to capital toentities operating in the hard-to-abate sectors.
China’s high-levelstrategic objectives
have underpinned theproliferation of labelledthemes in the bond market.
Labelled themes attached togreen, transition, social and sustainability reflect
the overarching long-term strategic agenda in
China’s economic and social development. China
views tackling climate change as an importantangle for high-quality economic development,
high-level environmental protection, andconstruction of ecological civilisation.1 The
commitment to reaching carbon peaking by 2030
and carbon neutrality before 2060 propelled thegrowth of China’s green bond market in 2021 andits continued development into 2022. Meanwhile,
the government’s ambition for more balanced
economic and social development, articulated in
the Common Prosperity and Rural Revitalisation
Strategy, contributed to the proliferation ofpoverty alleviation and rural revitalisation-relatedbonds under the social theme.
China supplied the largest
volume of green bonds in
2022, by Climate Bonds
definition. By the end of 2022,
cumulative labelled green
bond volumes originatingfrom China reached USD489bn (RMB3.3tn). This
included USD155bn (RMB1tn) priced in onshore
and offshore markets in 2022, representing yearon-year (YOY) growth of 35%.2 Climate Bonds
recorded USD85.4bn (RMB 575.2bn) in its Green
Bond Database (GBDB) in 2022, with a cumulative
tally of USD286.9bn (RMB1.9tn). China was thelargest source of green bonds in 2022, according
to Climate Bonds definition. However, thecontribution of labelled green bonds to China’s
overall debt market remained small, at 1.5%in the onshore market. In July 2022, the China
Green Bond Standards Committee published
China Green Bond Principles to further harmonise
definitions and practices in the domestic andinternational green bond markets.3
Transition-related bond
instruments emerged toaddress the financing
needs of economy-wide
transition. The Chinese
economy relies on carbonintensive sectors, which must be addressed if
China is to meet its carbon neutrality objectives.
Following a pilot scheme of SLB issuance in
2021, China began to explore transition bonds foreight heavy industries in 2022. As of the end of2022, SLBs and transition bonds listed onshore
and offshore had reached cumulative volumesof USD19.6bn (RMB131.9bn), 92% of which were
SLBs. The market is still in its infancy, demanding
policy support around standards and incentives
to facilitate growth. China’s central bank is
expected to put forward sector-specific transition
finance standards, starting with steel, thermal
power, construction materials, and agriculture. It
will later be expanded to broader areas according
to actual needs.4

the green bond supply. As China accelerates
the opening of its bond market with further
harmonsation of definitions and practices, it
is also likely to see more participation frominternational issuers and investors. Foreignissuers have already brought thematic labelled
panda bonds.
China’s massive low-carbon
transition creates hugeinvestment opportunities.
Labelled bond products havea huge role to play. China’s
climate think tank estimatedthat the nation’s energy transition would require
more than RMB100tn (about USD15tn) overthe next 30 years, pointing to huge investment
opportunities.5 A few industrial trends aroundrenewable energy and electric vehicles havecontributed to booming green bond issuance.
Renewable energy has accounted for the largest
share of green bond UoP while the auto industry
is gearing up to embrace a zero-emission vehicle(ZEV) future.6 Standardised, labelled green bonds
can support such transformations, and that of
the entire supply chain. Ensuring the credibility
and transparency of thematic debt instruments
will be pivotal to scaling in the capital market.

Scaling up the market
takes a diverse group ofparticipants, public andprivate, domestic andinternational. China’s
state-owned enterprises(SOEs) have been a major issuer type in
the thematic debt markets. 2022 started tosee more participation from private companies
in green bonds and debut issuers from various
industries contributed to more than half ofChina Green Bond Market Report 2022 Climate Bonds Initiative3

GreenOverview

China’s green bond issuance continued to expand in 2022
160

China’s green
bond market
China’s labelled green
bond issuance reached a
new annual high in 2022
following a vigorous rebound the year before. As
the country’s climate commitment became further
integrated into its overall policy and economic
system, labelled bonds gained prominence as achannel to support green activities and projects,
even during an economic slowdown.

China is the leading sourceof green bonds globally, by
Climate Bonds definitions
Climate Bonds Green Bond
Database (GBDB)Climate Bonds screens self-labelled debt
instruments from over 80 jurisdictions
against the Climate Bonds Green Bond
Database Methodology (2022 version) (theMethodology) to inform inclusion in the
Climate Bonds GBDB. Inclusion in Climate
Bonds GBDB indicates that there is publicly
available evidence to support the bond’s
general alignment (aligned green bonds) to
the Climate Bonds Taxonomy. By applying
the standard methodology, this screening
exercise allows cross-market comparison andglobal application.

Chinese green bonds in GBDB

120

Labelled green bonds from Chinese issuers

100
80
60

USD Billions

In 2022, Chinese issuers priced a total of USD155bn(RMB1.0tn) in onshore and offshore labelled green
bonds representing 35% YOY growth. This brought
cumulative volumes to USD489bn (RMB3.3tn)
by the end of the year. The growth was led by
the expansion of onshore labelled green bondissuance (around 890bn). While growth in China’s
domestic bond supply remained flat (RMB61.9tn),
labelled green bonds gained a bigger share,reaching 1.5% in 2022 up from 1% in 2021.

140

40
20
0
2016

2018

2019

2020

2021

2022

Source: Climate Bonds Initiative

China has huge potential to further scale up its
domestic and international green bond markets.
As a well understood and broadly standardised

tool, green bonds can help direct capital flows to
the relevant assets, projects, and expenditures,and contribute to meeting China’s climate goals.

Green Bond Database Methodology:
key updates in 2022

screening criteria in more established sectors
such as building and transport. Major changes
in assessment criteria are highlighted below.

Climate Bonds is dedicated to ensuring rigor
and ambition in the green bond market andpromoting a credible economy-wide transition
toward a low carbon future.
Climate Bonds published its latest GBDB
Methodology in July 2022, with tightened

As the green bond market matures and theneed to decarbonise becomes more pressing,
the assessment for inclusion to the GBDB will
be further tightened and a more granular levelof disclosure will be needed.

SectorMajor updates

Building

The assessment was tightened so that only higher rated, well-establishedinternational and local certification schemes and energy performance
rating schemes are eligible for inclusion. For example, in previous
approaches the GBDB Methodology accepted lower levels of building
certification than the LEED Gold proxy used for Certification, and this is
no longer acceptable.14 Refer to Annex E of the 2022 edition for the list of
Eligible Building Certifications.
In addition, The Methodology now specifies a threshold of 30%
improvement in energy efficiency compared with a requirement of‘significant improvement’ in the previous version.

Climate Bonds GDBD and green
bond indices
Various index providers have created green
bond indices whose composition is informed
by inclusion in the Climate Bonds GBDB.
Examples include the J.P. Morgan ESG (JESG)
indices, Solactive Green Bond indices,
FTSE Chinese (Onshore CNY) Green Bond
Index.11,12,13 Inclusion into the GBDB indicatesthe securities’ general alignment with the
Climate Bonds Taxonomy, an internationallyrecognised standard for green projects,
activities, and expenditures. By doing so, it
ensures that all bonds are assessed on a levelplaying field.

2017

Transport

The assessment is accompanied with more granular threshold indicators incertain subsectors. The updated Methodology now specifies a threshold ofless than 50g CO2/p-km to the end of 2025 and zero emissions thereafter for
low carbon vehicles (ZEVs, hybrids and hydrogen fuel cell vehicles), as well
as for public transport buses and coaches, bus rapid transit (BRT).
The Methodology now specifies the reporting metrics for ship vessels of
5,000 GT or above. Refer to Annex F of the 2022 edition for details.

Hydropower

China Green Bond Market Report 2022 Climate Bonds Initiative

The assessment for this asset category was updated along with the Climate
Bonds Taxonomy, which focuses on the power density and GHG footprintof reservoirs. Excluded deals may be included retroactively to reflect theevolution of scientific thinking.

4

Most Chinese green bonds will reach maturity
in the next three years. Chinese issuers tend tofavour shorter tenors, with about 97% of labelledgreen bonds and 89% of green bonds in the
GBDB having a maturity of five-years of less.

20

Most green bonds obtained an external review,
81% by volume or 68% by deal count, among
the issuance aligned with the Climate Bonds
definition. The second-party opinion (SPO)
remained the most popular method in both
onshore and offshore markets by volume anddeal count.

ra
n

Ja
pa
n

Ita
ly

Sp
ai

n

UK

Fr
an

ce

s

Ne
th
e

rla

at
io

nd

na

l

y
an
m

Ge
r

Ch
i

Su
p

Source: Climate Bonds Initiative

Green bond issuance from China expanded in 2022
Cumulative issuance (Right)

-30

0

Ita

Sp
ai

Sw
ed

s

er

la

nd

na
Ne
th

at
io

Su

pr
an

Fr
an

an

in

rm
Ge

ly

100

n

-20

en

200

UK

-10

l

300

ce

0

y

400

a

10

USD Billions

YoY Increment

Source: Climate Bonds Initiative

Chinese issuers favour shorter tenors
100
80

Chinese green bonds in GBDB

60

Labelled green bonds from Chinese issuers

40
20
0

External reviews remain the norm,
while new regulations will guide thirdparty verifiers
External reviews provide independentconfirmation on the alignment of the green bondwith a stated green bond framework or standard.
The proliferation and practice are likely to improveas the government put forward regulatory
guidelines for the third-party verifications. Different
types of external reviews also provide various
levels of rigour in guarding against greenwashing.

US
A

0

na

USD Billions

40

Ch

The GBDB inclusion rate decreased by six
percentage points from 2021 to 55% in 2022. Thiswas partly because Climate Bonds tightened its
screening Methodology as referenced above. For
example, bonds funding green building projects
with lower certification labelling than the China
Green Bond Label (GBEL) Three Star would nolonger be eligible for inclusion. Meanwhile, about
23% of China’s onshore labelled green bonds wereprivate placement deals in 2022, for most of which
Climate Bonds could not find sufficient information
to support inclusion in the GBDB. The alignmentof onshore Chinese labelled green bonds with the
100% UoP-to-green principle improved significantly.
Please see page 8 for detailed analysis.

60

US
A

China’s cumulative green bond volumes in the
GBDB reached USD286.9bn (RMB1.9tn) by the endof 2022, coming second after the USA with total
volumes of USD380.0bn (RMB2.6tn). While othermajor green bond markets experienced declines
in their 2022 issuance volume, China remained
a bright spot with a USD15.1bn (RMB102.0bn)
increment, or 22% YOY growth. This expansion
was underpinned by the country’s continued
implementation of green finance policies tosupport commitments towards carbon peaking
by 2030 and carbon neutrality before 2060.

80

USD Billions

China was the largest country source of green
bonds in 2022 and Climate Bonds recorded
volumes of USD85.4bn (RMB 575.2bn) fromonshore and offshore issuers. The USA followedwith volumes of USD64.4bn and Germany(USD61.2bn) took third place.

China was the largest source of green bonds recorded by Climate
Bonds in 2022

USD Billions

The following analysis is based on the Climate
Bonds GBDB as of 20 January 2023, unlessotherwise specified. The term “green bonds”
refers to those included in the GBDB, unlessotherwise specified.

2023

2024

2025

2026

2027

2028

2029

2030
onwards

Source: Climate Bonds Initiative

Certification is a formal endorsement of a debt
instrument’s green credentials based on anassurance report from an independent external
reviewer confirming full alignment with the
Climate Bonds Standard (CBS) and relevant
Sector Eligibility Criteria. Five deals from China’s
onshore market obtained Climate Bonds
Certification in 2022. They were issued by the
Agricultural Bank of China and the China
Development Bank, with a combined volumeof USD7.0bn (RMB47.2bn) or equivalent to nearly
10% of onshore bonds logged in the GBDB.
China Green Bond Standards Committee,
affiliated with the China Securities Regulatory
Commission (CSRC) and National Association

China Green Bond Market Report 2022 Climate Bonds Initiativeof Financial Market Institutional Investors(NAFMII), approved 18 third-party external
review service providers in September 2022.
Most of these service providers are also Climate
Bond Approved Verifiers, who are qualified
to provide assurance about whether a bondmeets the requirements of the CBS and sectorbased technical criteria under the CBS andCertification Scheme. Examples included China
Lianhe Equator, China Chengxin Green Finance,
Golden Credit, iGreenBank, CECEP Hundred
Technical Service (Beijing), Beijing Zhongcai
Green Financing Consultants, China Quality
Certification Centre, SynTao Green Finance, andMorningstar Shanghai.7

5

Climate Bonds Certification versus SPO
Climate Bonds Certification

SPO

What
is it?

A formal endorsement of a debt instrument’s green credentials
which is based on an assurance report from an independent
external reviewer confirming full alignment with the CBS andrelevant Sector Criteria.

An opinion by an independent external reviewer to determine
whether the green bond framework is aligned to accepted market
principles (e.g., the Green Bond Principles or the Green Loan
Principles) and that the intended UoP of the bond or loan arealigned with the stated taxonomy.

Who
does
them?

A Climate Bonds Approved Verifier conducts theverification engagement and the Climate Bonds awards
the Certification Label.

SPO service providers

Pros• Requires the issuer to follow up with post issuance verification
and annual reporting for the duration of the bond• This is the most established approach in the market• The rigorous framework is considered best practice by investors• The binary assessment is conducted against fully transparent
standards and criteria• Typically confirms alignment of the issuer’s Green Bond
Framework with the ICMA Green Bond Principles but may also
include alignment with stated taxonomies and/or UN SDGs

• The CBS incorporates the ICMA Green Bond Principles, so noseparate SPO is required• Sector Criteria are based on science and align with the Paris
Agreement• Certification is available for both the green and carbon-intensive
sectors, for entities, assets, SLBs from non-financial corporate
issuers, and UoP instruments
Cons• The Certification Scheme requires alignment with clear andspecific requirements, rather than guiding principles and does
not offer flexibility• Many different approaches used by SPO providers, including
proprietary methods and assessment framework which may not
be fully transparent• Not as sufficient to fully guard against greenwashing• As SPOs do not follow a single standard or methodology, they
are not comparable across issuers or sectors• Not required to follow-up after issuance and allocation of the proceeds• SPOs are still uncommon for SLBs and there is no acceptedinternational standard for assessing green companies/entities

Further adoption of the Common
Ground Taxonomy (CGT)As a joint initiative of the People’s Bank of China(PBOC) and the European Commission, the CGT
was an in-depth comparison exercise between
the green classification systems (taxonomies) of
China and the European Union (EU). It mappedout the commonalities and differences between
the two taxonomies, forming an important pieceof policy infrastructure.
In November 2021, the International Platformon Sustainable Finance (IPSF) publishedthe first version of the CGT report and list ofactivities. It was later updated in June 2022 tocover 72 climate change mitigation activities
that share common ground for both China

and the EU taxonomies with regard to the‘substantial contribution’ criteria. The work
focused on six priority sectors, including forestry,
manufacturing, energy, waste treatment,
construction, and transport. Though the CGT is
not legally binding in China nor the EU, it plays
an important role in increasing the comparability
and interoperability of sustainable financetaxonomies and green definitions globally.
The market saw more use cases of the CGT
being incorporated in onshore and offshore
green products. Since the first adoption by theConstruction Bank of China Macau Branch inits December 2021 green bond a few more banks/
entities incorporated the CGT in their green
frameworks in 2022.8

China Green Bond Market Report 2022 Climate Bonds Initiative

Climate Bonds expects more market applicationsof the CGT as it gets further integrated into policy
measures. The China Green Bond Principles,
released in July 2022, stated that overseas
issuers could use the CGT as a reference toidentify green products. The Hong Kong Special
Administrative Region (HKSAR) is also exploring
developing a green classification framework
for local adoption, which would facilitate easy
navigation across the CGT, Mainland China’s andthe EU’s taxonomies.9,10

6

Example use cases of the CGT in 2022
IssuerDate

ListingType

Funded projects

China Merchants Bank
(Sydney Branch)

March 2022

Offshore

BondWind power projects

Industrial Bank
(Hong Kong Branch)

May 2022

Offshore

Bond

Low carbon and low emission transportation, including but notlimited to the construction of rail transit; Renewable energy,
including but not limited to the development and construction ofphotovoltaic farms and offshore wind farms

Bank of China(Frankfurt Branch)

June 2022

Offshore

Bond

Electricity generation from wind power; Pumped hydropower
storage; Urban rail transportation; Pure electric bus; Manufactureof energy-saving equipment

Trina Solar Energy
Development

September
2022

n/a

Loan

Electricity generation using solar photovoltaic technology;
Production of solar generators

Agricultural Bank of China

October 2022

OnshoreBond

Low carbon rail transport (metro projects)

CDB Leasing

November 2022

n/a

Loan

Wind power projects

OnshoreEnergy and Transport remained the twolargest categories by UoP

Transport, Water and Waste UoP exhibited growth, while Energy UoP
remained the largest
70

Energy UoP declined by 4% YOY to USD35.9bn(RMB241.7bn). Top deals with purely Energy UoPcame from the Industrial and Commercial
Bank of China (ICBC), the State PowerInvestment Corporation Limited and China
Merchants Bank. Issuance from SOEs madeup 91% by volume, mainly from the Utilities andFinancials industry groups.17
Transport UoP experienced 77% YOY growth to
USD19.6bn (RMB132.1bn). Non-SOE participation
was more active in this space compared with
the Energy category, making up 30% share by
volume. Top deals with purely Transport UoPcame from the China Development Bank,
Agricultural Bank of China, and BYD Auto
Finance Company Limited.
Water and Waste UoPs grew 1.2 times and 6.6
times YOY respectively to USD6.4bn (RMB42.9bn)
and USD5.3bn (RMB35.9bn), while funding to the
Building category declined by 17% to USD2.7bn(RMB18.1bn). Climate Bonds tightened thescreening criteria for green building projects
in 2022. This resulted in the inclusion of fewerbonds supporting green building projects whichwere below the GBEL Three Star.

USD Billions

Climate Bonds recorded onshore green bondvolumes of USD71.5bn (RMB481.5bn) in 2022,
up 26% from the prior year.15 Onshore volume
accounted for about 84% of green bonds originatingfrom China. Half of onshore bonds included
Renewable Energy (Energy) in their UoP.16 Low
Carbon Transport (Transport) accounted for 27%.

60

EnergyWaste

50

Buildings

Land Use

40

Transport

Industry

30

Water

Adaptation

20
10
0
2016

2017

2018

2020

2021

2022

Source: Climate Bonds Initiative

These issuers either had not previously issued green
bonds; or this was the first time their labelled debt
had qualified for inclusion in the GBDB. The debut

Debut issuers dominated in 2022
Financials 36%

issuers contributed 56% of the 2022 supply of green
bonds onshore. Most came from the financials,
industrials and utilities sectors.18 Examples of debut
issuers included the lithium-ion battery makerContemporary Amperex Technology (CATL),
the national joint-stock commercial bank Ping An
Bank, and steel makers Liu Zhou Iron & Steel andHunan Iron & Steel Group.

Sectors and UoP categories

Returningissuers44%

Debut
issuers
56%

Increased diversification of supply as
issuer base broadened
2022 saw numerous debut issuers joining thegreen bond market, increasing the diversification of
supply. The 2022 pool of green bonds came from
186 participants, 130 of whom were debut issuers.

2019

Others 5%
Utilities 7%
Industrials 8%

China Green Bond Market Report 2022 Climate Bonds Initiative

The sector of a bond describes the economic
activity of its issuer. The Global Industry
Classification and Standard (GICS) and WIND
Industry Classification are examples of sector
classification standards. The UoP category
describes how the funds raised from thesale of the instrument will be deployed.
Taxonomies provided by organisations suchas Climate Bonds, the EU, and China are
examples of UoP categorisations. The sectorof a bond issuer is unrelated to the UoP
categories. For example, a bank (financial
sector) can issue green bonds with UoPearmarked for Energy and Transport.

Source: Wind, Climate Bonds Initiative7

Non-SOEs became more active participantsin the market compared to prior years. In
2022, about 16% of onshore issuance volume, or
USD11.4bn (RMB76.6bn) came from non-SOEs.
Issuance from the Guangdong Non-SOEs madeup 55% of the total non-SOE green bond volume.
Examples included China Merchants Bank, Ping
An Bank and Guangzhou Rural Commercial
Bank, which are classified as public companies by
the WIND company nature classification.
Geographically, Beijing led green bond issuancewith a volume of USD32.3bn (RMB217.7bn), or
45% of the total onshore volume recorded by
Climate Bonds in 2022. This was in line with theobservations by company nature, as most central
SOEs’ headquarters are registered in Beijing
and they have been the main sources of green
bond supply. However, the largest geographic
growth came from the Guangdong Province,
which nearly doubled issuance from a year
ago to USD10.5bn (RMB70.9bn). Deals from thenon-SOEs registered in the province was a major
driving force for this growth.

2022 saw more participation from non-SOEs in green bond issuanceCentral SOEs

2022

Guangdong Province

Shanghai

Other regions

Non-SOEs

66%

18%

16%

1%
74%

2021

0%

20%

25%

40%

60%

80%

100%

Source: Wind, Climate Bonds Initiative

Alignment with the 100% UoP-to-green rule significantly improved
amongst Chinese onshore labelled green bonds
30%

Guangdong Province showed
rapid deal growth while Beijing
remained the top region of supply
Beijing

Provincial SOEs

2020

2021

2022
By volume
By number of bonds

25%

20%

70
15%
Percentage of non-alignment

60
50
40

USD Billions

30
20
10
0
2021

10%

5%

0%

2022

Q4

Q1

Q2

Q3

Source: Wind, Climate Bonds Initiative

Improved alignment with 100% UoP-togreen rule
The Green Bond Standards Committee released
the China Green Bond Principles (CGBP) in late
July 2022. It advocated for standardisationand high-quality development of Chinese
green bonds, potentially leading to their higher
recognition in the international market. The
guidelines are self-regulatory and voluntaryby nature. The CSRC also instructed both the
Shanghai and Shenzhen exchanges to revise
listing rules for such bonds accordingly.19
One of the highlights of the CGBP was tomandate 100% of the bond proceeds to green
projects. This update reduced discrepancies
between international and Chinese green bond

Q4

Q1

Q2

Q3

Q4

Source: Climate Bonds Initiative

standards with respect to the allocation ofproceeds. Historically, Chinese enterprise andcorporate green bonds could respectively haveup to 50% and 30% of proceeds used for general
corporate purposes, whereas the CBS and ICMA
Green Bond Principles require 100% of net
proceeds to green assets, projects, or activities.20

around this metric improved over the last two
years. Percentage of non-alignment due to using
partial UoPs for general working capital purpose
decreased significantly, measured by bothissuance volume and deal count.

Full implementation of the CGBP across all
Chinese bond types, governed by different
government authorities, will be key to improving
international recognition of Chinese green bondsupply. Allocating part of the net proceeds forgeneral working capital had been one of the main
reasons for excluding some Chinese onshorelabelled green bonds from the Climate Bonds’
GBDB. Based on the screening results, alignment

China Green Bond Market Report 2022 Climate Bonds Initiative

8

Harmonisation of green definitions supported scaling the China’s green bond market
China began to put out green bond-related
policies in 2015. Since then, its green bondmarket enjoyed generally continuous growth
to its leading scale today. The harmonisationof domestic green definitions amidst different
bond products, supported by collective
efforts from various ministries, played apivotal role in bringing clear guidelines tothe market. This was showcased by making
the Green Bond Endorsed Projects Catalogue(2021 Edition) applicable to the whole Chinese
green bond market in the China Green Bond
Principles, even as the supervisory structure of
the bond market remained fragmented. The

update of the Green Bond Endorsed Projects
Catalogue (2021 Edition) from its 2015 version
also demonstrated efforts to align thedomestic green definition with internationalcounterparts, most notably with the removalof ‘clean coal’.

Time

Supervisory
authority

Policy Measures

Product Type

Taxonomy reference

22 Dec 2015

PBOC

Administrative Measures for theIssuance of Financial Green Bonds in
the National Inter-bank Bond Market

Financial bonds

Green Bond Endorsed Projects
Catalogue (2015 Edition)

31 Dec 2015

NDRC

Guidelines on Green Bond IssuanceEnterprise bonds

NDRC Guidelines23

02 Mar 2017

CSRC

Guiding Opinions for Supporting theGreen Bonds

Corporate bonds andcorporate ABS

Green Bond Endorsed Projects
Catalogue (2015 Edition)

22 Mar 2017

NAFMII

Guidelines on Green Debt Financing
Tools for Non-financial Enterprises

Debt financing instruments
and asset backed notes (ABN)Green Bond Endorsed Projects
Catalogue (2015 Edition)

02 Apr 2021

PBOC, NDRC,
CSRC

Notice of PBOC, NDRC, CSRC on
Issuing the Green Bond Endorsed
Projects Catalogue (2021 Edition)

All of the above

Green Bond Endorsed Projects
Catalogue (2021 Edition)

29 Jul 2022

China
Green Bond
Standards
Committee

China Green Bond Principles

Types of green bonds:
Green bonds (UoP)
Carbon yield green bondDomestic issuers:
Green Bond Endorsed Projects
Catalogue (2021 Edition)

Green project revenue bondOverseas issuers:
Common Ground Taxonomy
EU Taxonomy

Green ABS

China’s electric vehicle industry is fast-growing.
Battery electric vehicle sales and production
reached a record high in 2022. The trend islikely to continue in the coming years, withthe government’s target of 40% of incremental
vehicles fuelled by new and clean energy
annually by 2030.21 Green bond issuance can
support investments along the supply chain as
car makers and battery manufacturers expand
their production lines. Green ABS from EV sales
is also expected to grow accordingly.
In 2022, Climate Bonds recorded green
bond deals from BAIC Motor Corporation,with UoP earmarked for new energy vehicle
capacity expansion. Climate Bonds also
included green asset-backed securities (ABS)from auto financing companies set up by
Chinese EV auto companies such as BYD,
Zhejiang Geely, China FAW Group, andSAIC-GM, as well as battery leasing companies
such as Weineng Battery. A securitisation canbe defined as green when the underlying cash
flows relate to low-carbon assets or where
the proceeds from the deal are earmarked toinvest in low-carbon assets.22

The green bond market can support EV development600
EV sales500

EV production

400
Number of vehicles (1000s)

Chinese electric vehicles
drive green bond deals

300
200
100
0
01 02 03 04 05 06 07 08 09 10 11 12 01 02 03 04 05 06 07 08 09 10 11 12
2021

2022

Source: Wind

Green bonds can support investments along the EV supply chain
Renewableenergy(wind/solar)

EV salesChina Green Bond Market Report 2022 Climate Bonds Initiative

EV manufacturing

Battery
manufacturing
Charging
station9

Offshore

Offshore volume made up 16% of total supply from Chinese issuers in 2022

In 2022, Climate Bonds recorded offshore green
bond volumes of USD13.8bn (RMB93.2bn) from
Chinese issuers, accounting for about 16% of its
overall supply. Growth stayed relatively moderate
at 4% YOY, compared with 26% expansion in
the onshore market. Most of the offshore green
bonds were denominated in USD, followed by
EUR and CNH (offshore Renminbi). The Stock
Exchange of Hong Kong (HKEx) remained thelargest listing venue for Chinese offshore green
bonds, taking a share of around 43%.24

Onshore
RMB
83.8%

USD 13.6%

Offshore
16.2%

Unlike the onshore market, where the UoP aremostly earmarked for Energy and Transport, the
UoP in the offshore market were more evenly
distributed across various categories. Energy,
Building, Transport and Water made up a
combined 87% of the volume. Entities operatingin the financial-corporate space took 74% of thevolumes, similar to the prior year.

Offshore RMB 1.2%
EUR 1.2%
HKD 0.3%
Source: Climate Bonds Initiative

UoP distribution of Chinese offshore green bonds
EnergyBuildings

Transport

Water

Land Use

Industry

ICT

Adaptation

HKEx remained leading venue
for offshore Chinese green bondlisting in 2022

Waste

14
OthersLuxSE 8.1%
6.1%

12
10

Nasdaq DU
8.4%

8

LSE
9.7%

6
USD Billions

HKEx
42.6%

4

All German
11.5%

2
0
2016

2017

2018

2019

2020

2021

2022

Source: Climate Bonds Initiative

Offshore green bonds by the People’s
Government of Shenzhen Municipalityof Guangdong Province (Shenzhen
Government)
Shenzhen, is one of the most economicallyadvanced regions in China, and led byprioritising climate change response in its
ecological environment governance system.
The city began to implement China’s first green
finance law (the Shenzhen Special Economic
Zone Green Finance Regulations) in March 2021,
mandating listed financial companies registeredin Shenzhen to disclose environmental
information from the start of 2022.
The Shenzhen Government issued offshore
Renminbi (CNH) local government green
bonds in Hong Kong in October 2021 and

SGX
13.7%

Source: Climate Bonds Initiative

Date

Size

Tenor

Coupon rate

19 Oct 2021

RMB1.5bn

3-year

2.70%

Clean transportation projects25

19 Oct 2021

RMB2.4bn

5-year2.90%

Water treatment projects /sponge city related projects

7 Nov 2022

RMB1.5bn

3-year

2.65%

Clean transportation projects/ water treatment projects
and/or sponge city related
projects26

7 Nov 2022

RMB1.1bn

5-year2.83%

Water supply projects / water
sanitation projects

priced again in November 2022, against its Green
Finance Framework and Green and Blue Finance
Framework respectively. Shenzhen’s successful

China Green Bond Market Report 2022 Climate Bonds Initiative

UoPs

offshore green bond experience can be modelfor other provinces and municipalities in
China.

10

Transition
Overview
China has developed aformidable green bondmarket underpinned byclear guidelines and thecommitment to realise
its climate goals. This
experience can be extended to scaling up its
nascent transition debt market.
China’s economy currently has a high degreeof reliance on energy-intensive, high-emitting
industries, or what is often termed hard-to-abate
sectors. Heavy industries contribute to 31% of thenation’s total emissions, eight percentage points
higher than the world average.27 China is also a
leading producer in carbon-intensive sectors such as
steel, cement, and chemicals. These sectors need alarge amount of capital to support their low-carbon
transition efforts, from technological research anddevelopment to green purchasing and retrofitting.
Despite significant strides that the country has madetowards the achievement of its 30.60 climate
targets, green or near-green activities only
account for a small fraction of its economy. Chinaneeds to build a credible and scalable market
to mobilise a significant amount of additional
financing for the whole-economy transition.
A sizable transition finance market can only becreated, backed by verifiable, credible, ambitious,and transparent strategies and action plans. In
September 2022, Climate Bonds updated its
white paper Transition Finance for Transforming
Companies (originally published in 2021),
providing a comprehensive framework to support
entities in developing credible and ambitioustransition plans. Climate Bonds will provide
transparent science-based criteria for nonfinancial corporate entities, credible SLBs andsimilar instruments, and assurance for investors
that sustainability requirements have been met
in respect of any Certified issuance. Increasingly,
transition plans are becoming a crucial tool for
public and private sector stakeholders to drive
action to net zero and avoid greenwashing whendefining and financing decarbonisations.

Huge financing opportunities to support
transition in China
The financing need is vast and urgent. For
example, the World Bank estimated that China
would need USD14-17tn from now until 2060
for the power and transport sectors alone,depending on different decarbonisation
scenarios.29 Climate Bonds estimated that China’s
steel industry alone would require RMB20tn(US3tn) investment, or RMB 500bn (USD74bn)
annually, to achieve carbon neutrality.30 However,
the journey of transition finance has just begun,
pointing to a large, urgent financing gap.

China’s transition finance is stillin a pilot stage
Bond instruments supporting transition aremostly SLBs and transition bonds. SLBs raise
general purpose finance and involve penalties
or rewards (e.g., coupon step-ups/step-downs,
early repayment obligations, etc.) linked tothe achievement of pre-defined, time boundsustainability performance targets (SPTs),
typically at the entity level.
Transition bonds are UoP instruments
predominantly from carbon-intensive industries.
They do not fall into the existing definitionsof green but are a critical component of an

economy-wide transition to net zero. Example
sectors include extractives such as mining;materials such as steel and cement; andindustrials including aviation and shipping.
China started exploring transition debt
instruments in 2021. In April 2021, the NAFMII
launched ‘sustainability-linked debt financing
instrument’, with relevant requirements referringto the ICMA’s Sustainability-Linked Bond Principles.
In June 2022, the Shanghai Stock Exchange
clarified the relevant arrangements for ‘low-carbon
transition-linked corporate bonds’. These products
are essentially SLBs, with UoP contributing to
general purpose capital and involving penalties/
rewards with key performance indicators (KPIs)
linked to specific SPTs.
In June 2022, the Shanghai Stock Exchange andthe NAFMII put forward the relevant guidelines
on transition bond products. The Shanghai
Stock Exchange launched ‘low-carbon transition
corporate bonds’ to prod green and low-carbon
transformation. It was shortly followed by the
NAFMII Notice to Launching Innovation Pilot
Programme Related to Transition Bonds report, tosupport debt financing instruments addressing
climate change and adaptation. NAFMII also
provided boundaries on low-carbon transition
activities or areas.

Guideline on low-carbon transition by Chinese regulators
Low-carbon transition areas
ShanghaiStock
Exchange

1. Advanced equipment catalogue in accordance with various industryspecific guidelines, R&D and application of other advanced processes andequipment that contribute to pollution prevention, energy saving and carbon
emission reduction.33
2. Clean and efficient development and utilisation of fossil energy such as
safe, efficient, green mining of coal, clean and efficient utilisation of oil and gas.
3. Application of energy saving and consumption reduction technologies,
transformation and upgrading of infrastructure, data centres and others.
4. The overall optimisation of industrial park’s energy system and pollution
control, the construction of the “Green Island” project and other areas of industrial
park’s energy conservation and environmental protection improvement.34
5. Other areas that enable low-carbon transition.

NAFMII

Category 1. Projects that have been included in the Green Bond Endorsed
Projects Catalogue (2021 Edition), but their technical indicators do not meetthe standards

Clear guidance from the regulators is also
crucial. The G20 Transition Finance Framework,
published in 2022 with lead drafters from
China and the US, refers to transition financeas ‘financial services supporting the wholeof-economy transition, in the context of the
Sustainable Development Goals (SDGs), towards
lower and net-zero emissions and climate
resilience, in a way aligned with the goals of theParis Agreement’. It was an important building
block, based on which various jurisdictions
can develop measures to facilitate the market.
It could also serve as a reference for financial
service providers to strategise their positions.28

Category 2. Projects and other related economic activities that are in line withthe carbon peaking and carbon neutrality goals, with the effect of reducing
pollution and carbon emission, as well as improving energy efficiency, including
but not limited to:
1. Clean production and efficient utilisation of coal
2. Clean use of natural gas
3. Replacement of capacity in the eight heavy industries: electric power, building
materials, steel, non-ferrous metals, petrochemicals, chemicals, papermaking,civil aviation
4. Application of green equipment and technology
5. Other projects with low carbon transition benefits
Source: compiled by CIB Research

China Green Bond Market Report 2022 Climate Bonds Initiative

11

SLBs accounted for 92% of all-timelabelled bond issuance related totransition (by volume)
OnshoreOnshore SLB issuance40

By volume

By number of bonds (Right)

28

Offshore

18
16

30

21

20

14

10

7

0

0

14
12
10

RMB Billions

4
2
0
SLB

Transition
Bond

Co

Source: Climate Bonds InitiativePns
tr oweuc
tio r genen&r
en ati
o
gi
ne n
er
in
g
Co
Ba al
nk
in
Fi
g
na
St
nc
e
ia
l l elea
Mset
Tr ing
al
an
&
sp
no
Ch or
nm
em t
e
Pr
ic
op tal
m als
er
at
ty
ev eria
el
op ls
m
en
Bu
t
ild
H
in
yd
g
r
m
at o
er
ia
ls
Ot
he
rs

USD Billions

6

Number of bonds

8

Climate Bonds records but does not yet screentransition-related bonds against thresholds ortargets. As relevant criteria at both activity and entity
level are developed, Climate Bonds will introduce
screening for bonds and issuers in those sectors
based on a publicly transparent methodology.
As of the end of 2022, the combined all-timeissuance of SLBs and transition bonds listed
onshore and offshore from Chinese issuers came
to USD19.6bn (RMB131.9bn), where 92% from
SLB and the rest from transition bonds. A wide
range of heavy industries ranging from electric
power, construction materials, power, steel,cement to chemical companies, participated in
the market. Although SOEs were major players,
the market also saw issuance from non-SOEssuch as the Hongshi Group (a private cementcompany) and Huaxin Cement.
Cumulative issuance of SLBs reached USD18bn(RMB121.5bn), where 90% of volume were issued
onshore. In 2022, the volume of SLBs increased
by 38% to USD10.2bn (RMB68.7bn). Cumulativeissuance of transition bonds reached USD1.6bn(RMB10.4bn), 82% of which came from onshore
issuance. A total of 83 SLB and 16 transition deals
were recorded.

Climate Bonds classifies KPIs for SLBs into
multiple categories.31 Energy efficiency led as
the top choice at the end of 2022, reflecting
the focus of near-term transition strategies byheavy industries in China. For example, Anshan
Iron and Steel Group issued an RMB2bn SLB
in January 2022, with the KPI tied to the energy
consumption per ton of steel from its Anshan
and Bayuquan bases. Renewable energy was
the second most popular measure, especiallyamongst utilities and energy companies. An
example would be Shandong Energy Groupissuing an RMB2.5bn SLB in August 2022, with the
KPI linked to the cumulative installed renewablecapacity. An example KPI used under sustainablefinance-related category would be using thepercentage of green loans in the gross loan
amount.
Climate Bonds encourages the uses of absolute
GHG emission targets, or GHG emission intensity
tied to physical metrics (such as production),
as it would provide higher transparency andlinkage to GHG reduction impact. For example,
Huaxin Cement issued a dual-tranche SLB deal
in July 2022 worth of RMB900m, tied to a target
to reduce GHG Scope 1 and 2 Emissions to 829.63
kg CO2e/t clinker by 2024.

China Green Bond Market Report 2022 Climate Bonds Initiative

Most KPIs referenceenergy efficiency
OthersGHG
6%emissions
8%

Energyefficiency
37%

Sustainablefinance20%

Renewable energy
29%

Source: Climate Bonds Initiative12

Scaling credible transition
Standards help identify transition
activities and investment opportunities
Economic and energy structures vary amongst
different jurisdictions. This leads to different
deep decarbonisation strategies. One of the key
distinctions of China’s carbon emission profile
compared with developed countries is its muchlarger emission shares from carbon-intensive heavy
industries. China’s energy sector is the source ofalmost 90% of its greenhouse gas emissions.32
Since China announced its 30.60 climate goal in
September 2020, a few leading heavy industry
players have made carbon neutrality pledges.
They are mostly SOEs from sectors such as
power generation, oil and gas, and steel. Thoughthese announcements sent strong signals ofcommitment to key stakeholders and had ademonstrative effect on smaller peers in theirrespective industries, they ought to be backed
up by strategy, action plans and reporting todemonstrate credibility.
Behind these pledges and roadmaps lies
an urgent need for a clear transition plan,
including details of how proposed actions will
be financed. Without a clear transition financestandard, companies in carbon-intensive sectors
may find it difficult to justify their causes to thelending institutions using transition financetools. On the other hand, investors are facing
a large barrier in identifying credible transition
activities and investment opportunities.
Standards, by either a taxonomy or a set ofprinciples, could bridge the gap.
In 2022, Climate Bonds expanded its sector
standards into heavy industries with the launchof the Basic Chemicals Criteria, Steel Criteria,
and Cement Criteria, as well as the enabling
technology Hydrogen Production Criteria.
These standards can offer an important point ofreference with forward-looking pathway guidelinesaligned with the Paris Agreement 1.5oC limit.
Issuers can follow this guidance to ensure they aremeeting the highest levels of ambition

Examples of decarbonisation pledges by large corporations from
China’s heavy industries
Company

SectorCarbon neutrality
target year

Key message

Baowu Group

Steel

2050

China Baowu Carbon Neutrality Action
Plan: reduce carbon emissions by 30%
to 1.3 tons per ton of steel from the 2020
baseline and strive to be carbon neutral by
2050. The plan also lists six directions of
future development to achieve this goal.35

Sinopec Corp.

Oil and gas

2050

Achieving net zero by 2050.36

Three Gorges
Group

Power
generation

2040

Carbon peaking by 2023, and carbon
neutrality in 2040.37

Jianlong Group

Steel

2060

Carbon peak by 2025; 20% carbon
emission reduction from peak in 2033, andcarbon intensity 25% lower than that in
2020; carbon neutrality in 2060.38

Five Hallmarks can be used to assess companies’ transition plans
as well as SLBs.
Credible transition plans

Credible sustainabilitylinked bonds

Paris-aligned targets

Key performance Indicators
Sustainability Performance Targets

Robust Plans

Strategies to achieve the SPTs

Implementation Action

Achieving the SPTs

Internal monitoring

Internal monitoring

External Reporting

SLB Reporting

A tool to assess forward-looking
transition plan
Climate Bonds developed the Five Hallmarks asa tool to assess that transition plans are credible.
The Five Hallmarks emphases key governanceelements that are important indicators of acompany’s willingness and ability to deliveron its decarbonisation targets, but also adds
the granularity needed to ensure that thosetargets are ambitious and in line with the agreed
climate goals. These Hallmarks can be used ona standalone basis by any stakeholder to set
and assess the credibility of their own or others’
transition. Climate Bonds encourages issuers toaddress all Five Hallmarks when developing theirtransition plans.

China Green Bond Market Report 2022 Climate Bonds Initiative

13

Case study: using the Five
Hallmarks to assess SLBs
Huaxin Cement Co. Ltd (Huaxin Cement) is a
Chinese domestic cement producer. It issued
a RMB900m dual-tranche SLB deal in July
2022 and its KPIs were tied to GHG Scope 1 +2
Emissions reduction targets by 2024. It was thefirst low carbon transition-linked corporatebond from the cement industry listed on the
Shanghai Stock Exchange. The deal was wellreceived by 21 institutional investors in themarket and obtained the lowest interest rate
at issuance amongst bonds of the same tenor
within the industry.39
Name: Huaxin Cement
Issuer type: Non-financial corporate
Amount issued: Two tranches of RMB450m
Issue date: 19 July 2022
Maturity: 19 July 2025, 19 July 2027
KPI: GHG Emissions (Scope 1 and 2)
by unit in kg CO2e/t clinker
SPT: 829.63 kg CO2e/t clinker
Observation date: 31 December 2024
Financial Measure: Coupon step-up of 10bp
if targets are not met.
Climate Bonds’ summary view
Huaxin Cement’s SLB has set a strong
precedent in the domestic Chinese market for
the use of GHG targets in SLBs. Climate Bonds
urges Huaxin Cement and other issuers toraise the level of ambition in their GHG targets,by calibrating targets against 1.5˚C pathways,
including all scopes of emissions, andproviding further transparency to investors.

Five Hallmarks

Comments

1.Paris-aligned
targets

Huaxin Cement has set detailed short-,mid- and long-term Scope 1
emission intensity targets for both its cement and concrete businessstreams in its Low Carbon Development White Paper (LCD White
Paper). These targets (against a 2020 baseline) are five-yearly till 2035,
as well as 2050 and 2060 targets. While Carbon Capture Utilisationand Storage (CCUS) will play an important role in the businessdecarbonisation, Climate Bonds applaud that Huaxin Cement choseto have its emission reductions from CCUS and BECCUS not includedin the calibration of these targets.
Climate Bonds applauds Huaxin Cement’s ambitious Scope 1
emission targets, as well as the use of the SLB format to reinforce its
commitment to decarbonisation. Climate Bonds encourages Huaxin
Cement to 1) standardise its SLB targets with cement pathways; 2)
include scope 2 emissions; 3) conduct relevant Scope 3 emission
assessment.40

2.Robust plans

3.Implementation
actionHuaxin Cement’s transition strategy and action plan is documented
in detail in its LCD White Paper, including itemised carbon reduction
potential estimates for cement sector-specific decarbonisation
technologies and activities, the main ones being alternativeuse, clinker substitution, carbon capture and low-carbon clinker
development.
The same paper also estimates an investment plan of RMB10.5bn in
R&D and production facilities upgrades between 2020 and 2030 tofacilitate this transition. More recently, the company announced an
expected RMB12.2bn capital expenditure in 2022, up 68% from theprevious year, for its overall and low-carbon development.
Huaxin has governance mechanisms in place to manage theseenvironmental risks and manage the company’s decarbonisation,
including involvement from the board of directors, managers, andworking groups.

4.InternalreportingHuaxin Cement has committed to continuing annual Scope 1 and 2
absolute emissions and emission intensity reporting as part of thisSLB. Such disclosure was included in its 2021 ESG report,
and H1 2022 report.
Scope 3 reporting is also encouraged.

5.ExternalreportingEmergence of multi-labelled products
Following the proliferation of various green,social and transition themes, the market
saw emergence of multi-labelled products.
The RMB2bn bond issued by the Huaneng
Lancang River Hydropower in July 2022
was an innovation on this front. The bond,labelled as a sustainability-linked/rural
revitalisation/carbon neutrality bond, wasessentially a product with combined green

and social UoP, and SLB characteristics. Thisbond’s UoP were earmarked for green projects(hydropower facilities meeting Climate Bonds
definition). Meanwhile, its coupon rate waslinked to KPIs such as the newly installed
renewable energy capacity. The investment
also brings social impact that meetsrequirements of the Rural Revitalisation label
under the Chinese regulations.

China Green Bond Market Report 2022 Climate Bonds Initiative14

Social and sustainability
Most pandemic bonds were issued in 2020 as COVID-19 emerged
1.6
1.2
0.8
RMB Trillions

Based on the ICMA Social
Bonds Principles, social bonds
are those with UoP exclusively
earmarked to finance or refinance eligible social projects.
Sustainability bonds refer tobonds where proceeds are earmarked to finance or
re-finance a combination of both green and social
projects. This principle of exclusive UoP allocation
was also adopted by the NAFMII in 2021 when it
launched the pilot social and sustainability panda
bond programme on China’s interbank market.41
Currently, some Chinese thematic bonds suchas rural revitalisation bonds, though categorised
under social bonds, do not meet the rule of exclusive
UoP allocation. Climate Bonds’ work on socialand sustainability bonds originating from China
has just begun. The dataset referenced in thispart reflects labelled social-themed bonds andsustainability bonds without screening.

0
2020

2021

2022
Source: Wind, CIB Research

Regional development UoP made up most of China’s socialand sustainability bonds
200
Regional development theme
150

OnshoreSpecial economic relief bonds
Sustainability bonds

Cumulative onshore issuance of labelledsocial and sustainability bonds from
China tops RMB2tn

Pandemic bonds accounted
for over 70% of social andsustainability bonds from China
Sustainability
bonds 0.2%

Regional
development
theme
26.9%

100

RMB Billions

By the end of 2022, the cumulative issuance ofChina’s labelled social and sustainability bondsin the domestic market reached RMB2.17tn(USD321.7bn). Pandemic bonds accounted for
71.5% of the total amount, with cumulative
volumes of RMB1.55tn (USD230.1bn), buttressedby that China issued RMB1tn of special treasury
bond issuance in 2020 for pandemic prevention
and control. In addition, bonds supporting regional
development (including rural revitalisation bonds,
poverty alleviation bonds, revolutionary baserevitalisation bonds), special economic relief bonds,
and sustainability bonds reached cumulative
volumes of RMB582.7bn (USD86.5bn), RMB30.5bn(USD4.5), and RMB3.1bn (USD0.5bn) respectively.

Special economic
relief bonds 1.4%

0.4

50

0
2016

2017

2018

2020

2021

2022

Source: Wind, CIB Research

Various social and sustainability UoP havegained momentum as COVID-19 faded.
Since 2021, other social themes such as rural
revitalisation have picked up momentum,
while the volume of pandemic bond issuancefaded. Social and sustainability bonds
excluding pandemic bonds increased by 1.8
times YOY to RMB193.8bn (USD28.8bn) in2021.
This figure dropped by 35.4% YOY in 2022
to RMB125.2bn(USD18.6bm), but was still
significantly higher than the 2020 and before level.

Brief intro to Climate Bonds’ Social and Sustainability
Bond Database
Climate Bonds added a Social and Sustainability
Bond Database (SSBDB) to complement its
GBDB to provide a clearer snapshot of the
GSS+ debt market.42 Climate Bonds screensself-labelled UoP social and sustainability
debt instruments to determine inclusion in the
SSBDB against the SSBDB Methodology.43
There are three overarching requirements
for inclusion:

Pandemic
bonds
71.5%

2019

1. Debt instruments includes but is not
limited to bonds, asset-backed securities
and loans.
2. Self labelled, defined as a decisionby the issuer to tag the instrument under
the social and/or sustainability themes, as
communicated in deal documentations.

3. Sufficient public disclosure to:a. determine if the financed assets, projects,
activities, and expenditures fall under relevant
categories within the social or sustainability
themes, andb. allow the entry of the debt instrument
into the database, most notably including anamount outstanding and settlement date.
Climate Bonds’ work on social andsustainability bonds originating from China
has just begun. Climate Bonds does screen,classify and verify indicative data pertaining
to social and sustainability bonds from
China; however, the dataset referenced in thisreport reflects bonds labelled as social andsustainability without screening.

Source: Wind, CIB Research

China Green Bond Market Report 2022 Climate Bonds Initiative15

Focus: rural revitalisation bonds

Regulations on UoP

The regional development theme is an
important component of China’s social andsustainability bond market and contributed
26.9% of the cumulative volume by the end of2022. It covers rural revitalisation bonds, poverty
alleviation bonds, and revolutionary baserevitalisation bonds. The UoP are earmarked tosupport the development of poor rural areas. It
promotes equitable development of different
regions in the Chinese society, corresponding topoverty eradication (Sustainable Development
Goal, or SDG1), decent work and economic
growth (SDG8), and reduction of social
inequality (SDG10).

Regulator

Guideline

NAFMIINo less than 30% of the funds raised by rural revitalisation
notes should be used for rural revitalisation purposes, covering
project construction, repayment of project loans, and replenishment ofproject operating funds.

By the end of 2022, cumulative volumes of rural
revitalisation bonds (including notes) stood at
RMB292.2bn (USD43.4bn) and it was the largest
sub-label of the social and sustainability bondmarket. It accounted for 92.1% and 94.9% of
China’s domestic social and sustainability bonds
in 2021 and 2022 respectively.

The funds raised from rural revitalisation notes should be
invested in accordance with the requirements of the People’s
Bank of China for rural revitalisation in financial services andbe used to support the development of agriculture, rural areas andfarmers. The investment in rural revitalisation projects should adhere
to the principle of commercial sustainability and have a marketoriented investment income mechanism. The types of supported
projects include those related to rural revitalisation, such as farmers’
employment and income increase, agricultural modernisation,and rural construction.
Corporate bonds for rural revitalisation should meet one of thefollowing conditions: 1. The company is registered in a key county
for rural revitalisation or an area that has been lifted out of poverty forless than five years in accordance with relevant national regulations;the funds raised are mainly used for rural revitalisation-related areas;
2. The funds raised are mainly used for construction, operation,acquisition, or repayment of project loans for rural revitalisationrelated projects; the funds raised for such projects should not be lessthan 70% of the total amount raised.

Exchanges(Shanghai and
Shenzhen)

Rural revitalisation bonds have taken centre stage
amongst the social and sustainability themes in
China. In 2018, the Chinese government issued
a series of top-level documents on strategy torevitalise rural areas. It was also during this timethat some local governments started to issue
bonds dedicated to rural revitalisation. As China
realised its poverty alleviation goals and tasks
during the 13th Five-Year Plan (which ended in2020), the country started to comprehensively
promote its rural revitalisation strategy in 2021,
with the release of the No.1 Central Document‘Opinions on comprehensively promoting rural
revitalisation and accelerating agricultural andrural modernisation’. Subsequently, the NAFMII
and exchanges launched products such as
rural revitalisation notes and rural revitalisation
corporate bonds.

By the end of 2022, Chinese issuers had priced
social and sustainability volumes of USD27.1bn(RMB182.4bn) in the offshore market. No social
bonds originated from China in the offshore
market in 2021 and 2022 as the need to support
the immediate impacts of the COVID-19
pandemic had evaporated. 2022 volumes ofsustainability decreased by nearly 50% YOY to
USD3.8bn (RMB25.9bn). Most notably, in October
2022, the Hainan Provincial Government priced
two tranches of RMB sustainability bonds(RMB3.8bn in total) in Hong Kong, to support
projects covering a wide range of environmental
and social objectives mapped to the United
Nations SDGs.44 The deal was the first offshore
sustainability bond issued by a Chinese local
government.

Offshore social and sustainability bond issuance from Chinese issuers
14128

SocialSustainability

1064
USD Billions

Offshore

The funds raised should be mainly used in the field of rural
revitalisation, including supporting the development of characteristicrural industries in poverty-stricken areas, promoting the stable
employment of poverty-stricken people, improving infrastructure
conditions in poverty-stricken areas, improving public service levels
in poverty-stricken areas, and optimising rural employment structures
through market-oriented and legalised methods. Improve the ruralindustrial system, improve rural infrastructure, etc.

2
0
2018

2020

2021

2022
Source: Climate Bonds Initiative

China Green Bond Market Report 2022 Climate Bonds Initiative16

Sustainability bond case study
Sustainability bonds are bonds where theproceeds will be exclusively applied to financeor re-finance a combination of both green andsocial projects.45
Issuer: Guangzhou Development District
Investment Group Co Ltd (GDD Inv)
Issue Date: 28/07/2022
Maturity Date: 28/07/2025
Amount Issued: 400 million
UoP (100% allocation)
All net proceeds will be used for eligible green
and social projects defined in its Sustainable
Finance Framework (SFF).
Project selection
GDD Inv’s SFF is in alignment with ICMA’s
Green Bond Principles (2021), Social Bond
Principles (2021). The project selection process
shows the issuer has a good balance betweensocial and green projects, and includes covers
a wide range of eligible project categories.
SocialEmployment Training (building industrial
parks to attract companies to settle in),
Education (develop public education andtraining facilities in targeted communities),
affordable infrastructure (construction ofindustrial parks and supporting facilities)

Green
Energy (procurement and/or installation ofrenewable energy systems), Buildings (receive
recognized green building certifications),
Transport (Electric Rail Infrastructure andRolling Stock), Water (sustainable water
resources and wastewater management),
Waste (prevent and reduce waste andpollution)
SDG mapping
SDG4, SDG6, SDG7, SDG8, SDG9,
SDG11, SDG12
Project evaluation and regular reporting
The Sustainable Finance Working Group(SFWG) is responsible for the management of
this SFF and the compliance of all financing
instruments issued under the SFF. The SFWG
consists of senior representatives fromvarious departments.
Regular reporting enhances accountability andtransparency. The issuer has regular Allocation
Reporting and Impact Reporting. Allocation
reporting will disclose the allocation of the
net proceeds annually. Impact Reporting will
potentially cover environmental and social
benefits of the eligible projects with specificenvironmental and social impact indicators
disclosed. In addition, calculation methodologies
and key assumptions will be disclosed.

China Green Bond Market Report 2022 Climate Bonds Initiative17

Outlook
The world cannot reachcarbon neutrality without rapid
adoption and proliferation of
low-carbon technologies suchas renewable energy and lowcarbon hydrogen. The current
political and business momentum has openeda strategic window to further scale up capacityand drive down costs to allow these technologies
to become widely used. Key strategic industry
development initiatives from China, such as its
hydrogen development plan, EV manufacturing
and renewable energy capacity expansion willcontinue to have important implications to
the world. GSS+ debt instruments will be an
important channel through which to tap into
those opportunities.
China must rapidly scale up its GSS+ debt market
to achieve its 30.60 climate goal. The policy andmarket mechanisms that were successful inkicking off its world-leading scale green bondmarket can be leveraged to jump start a credibleand scalable transition finance market. Climate
Bonds highlights three developments that will
enhance market growth in 2023.

1. Policy will continue tounderpin market growth
China’s ‘five pillar’ green
finance policy framework
is expected to spawn
further policy measures including moregranular and actionable guidelines aroundstandards, disclosure, products, incentives, andinternational cooperation.

The 2022 publication of the China Green Bond
Principles introduced closer alignment ofdomestic practices, and harmonisation withinternational standards which included reference
to the CGT. This and the Green Bond Endorsed
Projects Catalogue (2021 Edition), marked acollaboration between different ministries tobring a set of clear definitions and standards
even as China’s bond regulatory supervision
remained fragmented.
High-emitting industries will requirelarge amounts of capital to support theirtransformation and the market must be
supported via clear, transparent, standards toidentify credible transition opportunities. The
PBOC is leading the formation of sector-specifictransition finance standards, starting with steel,thermal power, construction materials, andagriculture.
Local pilot schemes will provide opportunities
to gather experience and finesse requirements
before wider adoption. Huzhou, one of the2017 eight green finance pilot zones introduced
its Huzhou Transition Financial Taxonomy inJanuary 2022, covering eight industries fromtextiles to agriculture.46 In August 2022, nine
ministries including the Ministry of Ecology andEnvironment (MEE) and NDRC identified 23 areas
as pilots for climate investment and financing,encouraging them to explore financial solutions
to tackle climate mitigation and adaptation in anorderly manner.

China Green Bond Market Report 2022 Climate Bonds Initiative

2. Engagement
around disclosure
China has already establisheda stringent and advanced
regulatory disclosure
framework, according to
Climate Bonds 2022 research paper, PostIssuance Reporting in China’s Green Bond
Market.47 With the coming of a global baseline
guideline around climate-related disclosuresuch as the ISSB, there will likely be moreengagement around disclosure between local
authorities and international counterparts. In late
December 2022, the IFRS Foundation signed a
Memorandum of Understanding (MoU) with the
Ministry of Finance of China to establish an ISSB
office in Beijing.

3. Broadening crediblelabelling to include more
instrument types
The expansion of Climate
Bonds Certification under the
CBS v4 will extend the identification of credible
transition finance. Enlarging the universe ofsuitable instruments can encourage moreinvestors to commit to dedicated investment
mandates, which in turn will attract new issuers
to the market.

18

Appendices
Appendix A. Composition of labels in GSS+ themes

Green

Sustainability

SocialSLB

Transition

Blue

ESG

Affordable housing

Sustainability-linked

Transition

ClimatePositive impact

Education

ESG-linked

Blue transition

Green

Sustainability

Equality

SDG-linked

Green transition

Green (carbon neutrality)

Sustainability awareness

GenderSocial impact-linked

Low-carbon transition

Renewable energy

SDG

Healthcare

Social- andsustainability-linked

Solar

Socially responsible
investing (SRI)

SDG housing

Environmental

Sustainable development

Town revitalisation

Water

Green innovation

Youth

PACE

ImpactEmployment

Sustainability

ImpactSDG
Climate resilience
ImpactAppendix B. CCDC Research:
ChinaBond Environmental
Benefits Disclosure Status
CCDC developed the ChinaBond Green Bond
Environmental Benefit Disclosure Indicator
System (the ChinaBond Indicator System) andthe ChinaBond Green Bond Environmental
Benefit Database (the ChinaBond Database).48
The ChinaBond Databases tracks both labelledgreen bonds and non-labelled bonds withproportion of funds invested in the green
industry projects. CCDC calls this latter set ofbonds Green-oriented bonds.

Environmental impact of green-oriented bonds in China in 2022
Indicator

Unit

Environmental
impact (reported)

Environmental
impact (estimated)

Carbon emission
reduction

Tonne/year

39,598,304

74,015,522

Fossil fuelreplacement

Tonne of standard
coal/year

15,672,841

29,295,030

Sulphur dioxide
reduction

Tonne/year

30,69357,370NOx reduction

Tonne/year

38,31971,625Chemical oxygen
demand reduction

Tonne/year

374,291

699,609

Ammonia nitrogen
reduction

Tonne/year

16,45730,762PM emission
reduction

Tonne/year

46,29586,532

Water saving

Tonne/year

39,906,458

74,591,511

DesiltingTonne/year

9,661,583

18,059,034

Average daily
passenger volume of
public transport

Ten thousandpeople7,991

14,937

Source: ChinaBond Green Bond Environmental Benefit Database

China Green Bond Market Report 2022 Climate Bonds Initiative

19

The ChinaBond Indicator System provides ascore based on the completeness of disclosure.
The highest score of 100 can be granted if all
mandatory fields are reported, and an additional
maximum of 20 marks can be obtained byreporting voluntary environmental fields.

Chart 1. Percentage of bonds disclosing environmental information at
the pre-issuance stage (by number of bonds)
Green-oriented bonds

Labelled green bonds

Financial bondMedium-termnote
Commercial
paperEnterprise bondCorporate bond
0%

20%

40%

60%

80%

100%

Source: ChinaBond Green Bond Environmental Benefit Database

Chart 4. UoP of labelled green bonds in 2022
200

1500

150

1000

100

500

50

or
t
ro
pr nm
ot en
Gr ect tal
ee ion
n
bu
ild
in
Ci
g
rc
ul
a
r ru
En eso seer ur ofcg
im y e es
pr ffic
ov ie
em nc
en y
t
En

Gr
ee

n

tr
an

en
ea
n
Cl

vi

En

Gr
ee

sp

er
gy

0

sp

n

tr
an

en
ea
n
Cl

or
t
ro
n
pr m
ot en
Gr ect tal
ee ion
n
bu
ild
in
Ci
g
rc
ul
ar
r
u
En eso seer ur ofcg
im y e es
pr ffic
ov ie
em nc
en y
t

0

vi

RMB Billions

2000

er
gy

RMB Billions

Chart 2. UoP amongst Green-oriented bonds in 2022

Source: ChinaBond Green Bond Environmental Benefit Database

Chart 3. Environmental disclosure score of greenoriented bonds in 2022
Score (Mandatory fields)

Source: ChinaBond Green Bond Environmental Benefit Database

Chart 5. Environmental disclosure score of labelledgreen bonds in 2022

Score (Optional fields)

Score (Mandatory fields)

Clean energy

Clean energy

Green building

Green building

Environmental
protection

Environmental
protection

Green transport

Green transport

Circular use ofresources

Circular use ofresources

Energy efficiency
improvement

Energy efficiency
improvement
0

20

40

60

80

100

Source: ChinaBond Green Bond Environmental Benefit Database

China Green Bond Market Report 2022 Climate Bonds Initiative0

Score (Optional fields)

20

40

60

80%

100

Source: ChinaBond Green Bond Environmental Benefit Database20

Endnotes
1. China’s Achivements, New Goals and New Measures for Nationally
Determined Contributions. https://unfccc.int/sites/default/files/
NDC/2022-06/China’s Achievements, New Goals and New Measuresfor Nationally Determined Contributions.pdf
2. A 2022 average USDCNY exchange rate of 6.7366 is used for conversion
between USD and RMB in this paper, unless otherwise stated.
3. NAFMII. July 2022. China Green Bond Principle. https://www.nafmii.
org.cn/ggtz/gg/202207/P020220801631427094313.pdf
4. Sina news. https://finance.sina.com.cn/money/bank/bank_yhfg/2022-12-12/doc-imxwkmhu9903778.shtml
5. Yicai news. https://www.yicai.com/news/100788326.html
6. SCMP news. https://www.scmp.com/business/article/3205828/
china-seen-accelerating-wind-solar-power-installation-under-fiveyear-plan-reaching-2030-renewable
7. Morningstar Group acquired Sustainalytics (now ‘Morningstar
Sustainalytics’) in 2020. Morningstar Shanghai, a subsidiary ofMorningstar Group, is engaged in Morningstar Sustainalytics
business. Morningstar Sustainalytics is an Approved Verifier for
Certified Climate Bonds.
8. Sina news. https://finance.sina.com.cn/esg/
investment/2021-12-15/doc-ikyamrmy9027921.shtml
9. China Green Bond Standards Committee. July 2022. China
Green Bond Principles. https://www.nafmii.org.cn/ggtz/gg/202207/
P020220801631427094313.pdf
10. Hong Kong Monetary Authority. 30 May 2023. Prototype fora Green Classification Framework for Hong Kong. https://www.
hkma.gov.hk/media/eng/doc/key-information/guidelines-andcircular/2023/20230530e1.pdf
11. J.P.Morgan Index Product Guide Global Index Research. https://www.jpmorgan.com/content/dam/jpm/cib/complex/content/
markets/index-research/Global-Index-Research-Product-Guide-2022.
pdf#page=1212. Solactive. 2021. Shining Green: Bonds to Tackle Climate Change.
https://www.solactive.com/wp-content/uploads/2021/09/SolactiveGreen-Bonds-September-2021.pdf
13. FTSE Chinese (Onshore CNY) Green Bond Index v1.3. 2022. https://
research.ftserussell.com/products/downloads/FTSE_Chinese_Green_
Bond_Index_RuleBook.pdf
14. Climate Bonds Initiative. 2022. Green Bond Database
Methodology. https://www.climatebonds.net/files/files/CBI_Method_
Criteria_03A.pdf
15. The RMB figures in the onshore session are as reported rather thanconverted using the 2022 average USDCNY exchange.
16. In cases where the UoP allocation is not disclosed at issuance,
Climate Bonds uses the bond frameworks to come up with proxies of
UoP allocations.
17. The type of company field is derived from the WIND categorisation.
SOEs include central SOEs and provincial SOEs, and Non-SOEs
include private companies, listed companies, wholly foreign-owned
enterprises (WOFEs), foreign-funded companies, sino-foreign joint
ventures etc..
18. WIND Classification

19. South China Morning Post. 24, August 2022. Beijing tightens
green bond rules, requires 100 per cent of proceeds to be invested inenvironmentally friendly projects. https://www.scmp.com/business/banking-finance/article/3190064/beijing-tightens-green-bond-rulesrequires-100-cent
20. Under the Chinese financial regulatory system, enterprise bonds
are approved by the National Development and Reform Commission(NDRC) and corporate bonds are governed by the China Securities
Regulatory Commission (CSRC).
21. State Council. 2021. Action Plan for Carbon Dioxide Peaking Before
2030. https://en.ndrc.gov.cn/policies/202110/t20211027_1301020.html
22. Climate Bonds Initiative. 2020. China Green Securitisation Stateof the Market 2020 report. https://www.climatebonds.net/resources/
reports/china-green-securitization-state-market-2020-report
23. Largely align with the Green Bond Endorsed Projects Catalogue(2015 Edition).
24. In multi-listing cases, each exchanges is allocated the full issuanceamount for calculation.
25. Shenzhen Government. 2021. Offering Circular. https://www1.
hkexnews.hk/listedco/listconews/sehk/2021/1020/2021102000242_c.pdf
26. Shenzhen Government. 2022. Offering Circular. https://www1.
hkexnews.hk/listedco/listconews/sehk/2022/1108/2022110800209.pdf
27. Yang, X., Nielsen, C.P., Song, S. et al. Breaking the hard-to-abatebottleneck in China’s path to carbon neutrality with clean hydrogen. Nat
Energy 7, 955–965 (2022). https://doi.org/10.1038/s41560-022-01114-6
28. G20 Sustainable Finance Working Group. 10 October 2020. 2022
G20 Sustainable Finance Report. https://g20sfwg.org/wp-content/
uploads/2022/10/2022-G20-Sustainable-Finance-Report-2.pdf
29. World Bank Group. 2022. Country Climate and Development
Report. https://openknowledge.worldbank.org/bitstream/
handle/10986/38136/FullReport.pdf
30. Climate Bonds Initiative. 2021. Transition Finance in China.
https://www.climatebonds.net/files/releases/mediarelease_china_transition_launch_final.pdf
31. Categories cover Undisclosed, Social, ESG score, GHG emissions,
Circular economy, Energy efficiency, Sustainable fiancé, Waste, Water,
Renewable energy, Biodiversity etc. This may change in the future as
the database is still in development phase.
32. IEA. 2022. An Energy Sector Roadmap to Carbon
Neutrality in China. https://iea.blob.core.windows.
net/assets/9448bd6e-670e-4cfd-953c-32e822a80f77/
AnenergysectorroadmaptocarbonneutralityinChina.pdf
33. The industry-specific equipment and technology catalogues《绿色技术推include《高耗能行业重点领域节能降碳改造升级实施指南》、
广目录》、《工业节能技术推荐目录》and “能效之星”装备产品目录.
34. The “Green Island” project is essentially a centralised disposal(storage) facility for pollutants. http://js.people.com.cn/n2/2022/0128/
c360304-35116119.html
35. SMM. 29 Nov 2021. “China Baowu Carbon Neutrality Action Plans”
released to explore new ideas of green low-carbon metallurgy in theindustry. https://news.metal.com/newscontent/101678929/%22chinabaowu-carbon-neutralization-action-plan%22-released-to-explorenew-ideas-of-green-low-carbon-metallurgy-in-the-industry

Published jointly by the Climate Bonds Initiative, China Central Depository & Clearing Research Centre(CCDC Research) and CIB Economic Research and Consulting (CIB Research)

36. China Dialogue. 21 April 2021. Carbon neutrality in China: behindthe corporate hype. https://chinadialogue.net/en/climate/carbonneutrality-in-china-behind-the-corporate-hype/
37. China Dialogue. 21 April 2021. Carbon neutrality in China: behindthe corporate hype. https://chinadialogue.net/en/climate/carbonneutrality-in-china-behind-the-corporate-hype/
38. SMM. 14 March 2022. Jianlong Group issues a roadmap forgreen and low-carbon development of iron and steel plate. https://
news.metal.com/newscontent/101774858/jianlong-group-issuesa-roadmap-for-green-and-low-carbon-development-of-iron-andsteel-plate
39. Huaxin company news release. 20 July 2022. Huaxin Cement
successfully issued the first low carbon transition linked corporate bondin cement industry. https://www.huaxincem.com/view/5322.html
40. Climate Bonds’ Cement Criteria pathway requires the inclusionof all emissions (including Scope 3) up to the point of the finishedcement, though not downstream emissions associated withtransporting or using the cement product.
41. NAFMII. October 2021. Q&As on Pilot Program of Social Bonds
and Sustainability Bonds. https://www.nafmii.org.cn/englishnew/
news/202112/W020211221402887081694.pdf
42. The SSBDB Methodology is reviewed at least semi-annually.
Please see Climate Bonds website for details.
43. Climate Bonds Initiative. 2022. Social & Sustainability Bond
Database Methodology. https://www.climatebonds.net/files/files/CBISocial-and-Sustainability-Bond-Methodology-14092022.pdf
44. Bond Prospectus. 26 October 2022. https://www1.hkexnews.hk/
listedco/listconews/sehk/2022/1103/2022110300423.pdf
45. ICMA. June 2021. Sustainability Bond Guidelines. https://www.
icmagroup.org/assets/documents/Sustainable-finance/2021updates/Sustainability-Bond-Guidelines-June-2021-140621.pdf
46. Macro and Green Finance Lab. 8 July 2022. http://mgflab.nsd.pku.
edu.cn/qyzz/98bfd494a1044bc4966245c4a66dc6e4.htm
47. Climate Bonds Initiative. 2022. Post-Issuance Reporting in China’s
Green Bond Market. https://www.climatebonds.net/files/reports/
post-issuance_reporting_in_chinas_green_bond_market_en.pdf
48. CCDC research report. http://www.ccdc.com.cn/ccdc/cn/business/c150471295/c150471502/c150481996/20230317/162246734.shtml

Funding for this publication was provided
by the Standard Chartered Bank
as a Gold Partner.

Author:Climate Bonds: DENG Manshu, XIE Wenhong, Matthew MacGeoch, XU Xinru
CCDC Research: SHI Yi, SHANG Jin, CHEN Yingying
CIB Research: LU Zhengwei, QIAN Lihua, FANG Qi
Editorial support: Caroline Harrison
Design: Godfrey Design© Published by Climate Bonds Initiative, May 2023 www.climatebonds.net

Disclaimer: The information contained in this communication does not constitute investment advice in any form and the Climate Bonds Initiative is not an investment adviser. Any reference to a financial organisation or
debt instrument or investment product is for information purposes only. Links to external websites are for information purposes only. The Climate Bonds Initiative accepts no responsibility for content on external websites.
The Climate Bonds Initiative is not endorsing, recommending or advising on the financial merits or otherwise of any debt instrument or investment product and no information within this communication should be taken
as such, nor should any information in this communication be relied upon in making any investment decision. Certification under the Climate Bond Standard only reflects the climate attributes of the use of proceeds of adesignated debt instrument. It does not reflect the credit worthiness of the designated debt instrument, nor its compliance with national or international laws. A decision to invest in anything is solely yours. The Climate
Bonds Initiative accepts no liability of any kind, for any investment an individual or organisation makes, nor for any investment made by third parties on behalf of an individual or organisation, based in whole or in part on
any information contained within this, or any other Climate Bonds Initiative public communication

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21