April 23, 2024
The Securities and Exchange Commission (SEC) has issued guidelines to regulate the issuance of green bonds. The Securities Industry (Green Bonds) Guidelines, 2024 (SEC/GUI/003/03/2024) (the SEC Green Bond Guidelines) which follow the green bond principles published by the International Capital Markets Association, provides:
(a) regulatory guidance on the criteria an issuer must meet to characterise its debt securities as green bonds;
(b) the processes for evaluating and selecting projects to be financed through the issuance of green bonds and applying for SEC approval to issue green bonds;
(c) rules for the management of the proceeds from the issuance of green bonds, as well as monitoring, performance evaluation, disclosure and reporting obligations for issuers of green bonds; and
(d) penalties for non-compliance with the SEC Green Bond Guidelines.
With the global focus on environmental, social and governance matters, it is expected that the SEC Green Bond Guidelines will facilitate the allocation of capital to projects with a positive impact on the Ghanaian environment and the development of a domestic green bond market. The guidelines will also prevent the incidence of greenwashing, through the implementation of its stringent approval standards, monitoring requirements and disclosure obligations.
