Prudential Financial announced the offering of the firm’s first green bond with a principal amount of $500 million, representing the first green bond issuance of its kind by a major US life insurer. The green bond was offered alongside an additional $1 billion of Prudential debt on March 5.
The green bond issuance expands Prudential’s support for sustainable investments aligned with the company’s Global Environmental Commitment, which established a wide range of business, operational, and investment goals to preserve and protect the environment. Other forthcoming efforts aligned with Prudential’s Global Environmental Commitment include an initiative to offset all carbon emissions for employee travel in the US and a renewable energy mandate to invest in companies that reduce global emissions.
Net proceeds from the green bond will be allocated exclusively to existing or future investments which provide environmental benefits including reduced greenhouse gas emissions and improved resource efficiency, subject to completing the issuance as planned. The eligible categories for the use of the net proceeds — renewable energy, green buildings, environmentally sustainable management of living natural resources and land use, energy efficiency, clean transport, sustainable water and wastewater management, and pollution prevention and control — align and advance the United Nations Sustainable Development Goals (SDGs).
Prudential has established a Green Bond Council, comprised of members of its Treasury, Chief Investment Office, and Corporate Governance/Sustainability teams. The Green Bond Council will be responsible for reviewing and validating eligible projects as well as relevant reporting to investors.
Sustainalytics, a global independent provider of ESG and corporate governance research and ratings, has reviewed and verified that Prudential’s Green Bond Framework is consistent with the current Green Bond Principles, as published by the International Capital Market Association.
Net proceeds from the $1 billion of Prudential debt issued alongside the green bond are intended for general corporate purposes, which may include refinancing portions of the company’s debt maturing through 2021.
In similar news, PepsiCo announced last year that it priced the company’s first ever green bond. The net proceeds from the $1 billion green bond offering will fund a series of key initiatives to advance PepsiCo’s sustainability agenda.