ESG framework may pave way for first Saudi PIF green bond sale

ESG framework may pave way for first Saudi PIF green bond sale
ESG investing is gaining in prominence in Saudi Arabia. (Reuters)
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Updated 21 October 2021

ESG framework may pave way for first Saudi PIF green bond sale

ESG framework may pave way for first Saudi PIF green bond sale
  • ESG investing is set to become a major theme of this year’s Future Investment Initiative (FII)

DUBAI: Saudi Arabia’s sovereign wealth fund could sell bonds as soon as the fourth quarter as it seeks to develop a new ESG framework, Reuters reported.
It comes as environmental, social, and governance (ESG) investing principles become more widespread among institutions in the Kingdom.
The Kingdom’s Public Investment Fund has asked banks to help it develop an ESG framework, Reuters reported, citing four sources, in a move that could allow it to expand its funding base to attract ESG-focused investors.
ESG investing is set to become a major theme of this year’s Future Investment Initiative (FII), Saudi Arabia’s flagship investment forum planned for October.
“We have a moral responsibility as the FII Institute to own this global conversation about ESG, because it is becoming a very hot topic,” Richard Attias, the institute’s chief executive officer, told Arab News in an interview earlier this month.
One of the sources said developing an ESG framework would likely precede a multi-billion dollar bond sale, which would be the Saudi wealth fund’s first.
Once an ESG framework is developed, PIF may need credit ratings and an audit of its finances before it can issue bonds, the source said, adding the fund could sell bonds in the fourth quarter if “all goes smoothly.”
PIF did not respond to an emailed request for comment from Reuters.