State of Hessen
Wiesbaden, Germany| Invested through |
|
|---|---|
| Asset Classes | Impact bonds |
| Impact strategy | Impact Equities and Bonds |
| ISIN code | DE000A1RQEK7 |
| Aligned with SDGs |
State of Hesse is situated in the western-central of Germany. It provides a range of services including education, health, law, regulation, transportation, public safety, and housing. Hesse has an economy that is primarily based on tourism, and chemical and pharmaceutical industries.
Investment rationale
The state of Hessen introduced its first sustainability strategy in 2008. Since 2018, the Hessian Constitution stipulates that the principle of sustainability must be taken into account in all decisions and actions of politics and administration in the city and state. The state of Hesse has stepped up on its climate neutrality targets and set the goal of becoming climate-neutral by 2045. The state has adopted Climate Plan Hessen in 2023 and sets stricter targets for reducing GHG emissions. In 2021, Hessen published its Green Bond Framework, which contains seven focus areas:
- eco-friendly public transport;
- measures concerning forests;
- CO2-neutral state administration/energy efficiency of public buildings;
- organic farming and nature conservation;
- climate plan;
- sustainable (waste) water management;
- further climate and environmental protection measures).
All categories have high level of transparency in terms of purpose and impact. The proceeds of this bond are used to refinance expenditure from the past two years of each issuance. New projects are being added to the eligible portfolio. Around 80% of expenditure is used to improve infrastructure and encourage usage of public transport. The rest is divided among forestry and nature protection, organic farming, waste management and green buildings.
In total 100% of the proceeds of the impact bond is aligned with one or more Triodos transitions. 83% of revenues is aligned with the Energy transition and 17% with the Resource transition.
The contribution to the Energy transition comes from 77% of proceeds allocated to the impact objective Terrestrial & Aquatic Biodiversity Conservation and 6% of proceeds allocated to Energy Efficiency.
The contribution to the Resource transition comes from 13% of proceeds allocated to the impact objective Climate Change Mitigation, 2% of proceeds allocated to Circular Economy, 1% of proceeds allocated to Environmentally Sustainable Management of Living Natural Resources & Land Use , and 1% of proceeds allocated to Pollution Prevention & Control.