foundational knowledge and lessons from global sustainable bond frameworks
high-level sustainable bond trends in Canada
Highlights:
Sustainable Mortgage Bonds support social housing projects that provide affordable and accessible housing solutions, particularly to vulnerable populations
Sustainable Mortgage Bonds support the development and/or retrofitting of green buildings to reduce the residential sector environmental footprint
Sustainable Mortgage Bonds are gaining momentum as several Canadian institutions are issuing or planning to issue green, social and sustainable bonds
Report 2 — Expected performance, investors’ motivations and econometric analysis
the financial performance that sustainable mortgage bonds could have in Canada
the potential environmental, social and economic impacts of sustainable mortgage bonds
investors’ views and preferences with respect to outcomes and other key considerations for market growth
Highlights:
there is interest from the investor community in generating green and social outcomes from their investment portfolios
it is too early to opine if sustainable mortgage bonds’ performance will exceed non-ESG bonds or meet investors’ risk-return targets
expected sustainable mortgage bonds’ outcomes could be more supply of affordable housing and rents plus savings in energy and fuel consumption
the higher the volume of sustainable mortgage bonds, the higher the impacts that could be linked to the housing sector
standardized definitions, recognized methodologies, robust reporting and data sharing process will play an important role in building investor’s confidence in Canada
Report 3 — Sustainable criteria for residential projects and the role of the government
high-level environmental, social and governance eligibility criteria that could be considered by developers and housing proponents
the role that the government could play in supporting the environmental, social and governance bond market and materializing sustainable goals
Highlights:
Expected outcomes are an increased supply of affordable housing, more affordable rents and energy consumption savings in the medium to long term.
The environmental, social and governance (ESG) bond market in Canada is expected to continue growing as investors, developers and housing proponents become more familiar with them.
The Government of Canada can explore various options to support the growth of the ESG bond market. Some of these include:
raising awareness
developing guidelines
setting best principles/practices
This series is part of our research priority area Housing Finance. Explore Innovative and disruptive financial solutions to promote private funding of affordable housing.
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Why are Sustainable Mortgage Bonds so relevant to the housing industry in Canada (PDF)
What is the potential performance of sustainable mortgage bonds in Canada? (PDF)
Sustainable Criteria for Residential Projects and the Role of Government (PDF)
