Listing Sustainability-Linked Bonds on The International Stock Exchange (TISE)
With climate change a major issue, there is a growing trend to list Sustainability-Linked Bonds on globally recognised stock exchanges. Here, we offer an introduction to listing Sustainability-Linked Bonds on The International Stock Exchange (TISE) as well as a summary of Appleby listing agent services in the Channel Islands.
Appleby Securities (Channel Islands) Ltd (“Appleby”) and The International Stock Exchange (TISE) work together on a significant number of listings of securities on TISE.
Sustainability
One recent theme is a growing trend to list Sustainability-Linked Bonds.
Sustainability-Linked Bonds aim to further develop the key role that debt markets can play in funding and encouraging companies that contribute to sustainability (from an Environmental and/or Social and/or Governance perspective, “ESG”).
Sustainability-Linked Bonds are securities that are issued with economic terms that can vary depending on whether the issuer company achieves pre-defined sustainability performance targets. For example, an issuer company may have to pay a penalty interest rate should it fail to meet the pre-defined targets. In addition, Sustainability-Linked Bonds are often characterised as high yield bonds.
The International Capital Markets Association (“ICMA”) have issued Sustainability-Linked Bond Principles (“SLBP”) that provide guidelines to recommend structuring features, disclosure and reporting. The SLBP have five core components:
- Selection of Key Performance Indicators (KPIs)
- Calibration of Sustainability Performance Targets (SPTs)
- Bond characteristics
- Reporting and
- Verification;
all of which contribute to the variety of Sustainability-Linked Bonds that are issued.
A number of Sustainability-Linked Bonds have been listed on TISE by issuers incorporated in Luxembourg, France and Germany, operating in a number of sectors, including waste management, pulp, paper and wood products, frozen foods and chemicals.
TISE Sustainable
Recently, TISE, launched a new market segment called “TISE Sustainable”. The “TISE Sustainable” segment is available to all TISE-listed issuers – including bond issuers and equity issuers – who comply with a recognised framework or rating that promotes environmental, social or sustainable activities.
Whilst offering a “Recognised Stock Exchange” for the purposes of UK HM Revenue & Customs TISE’s robust but proportionate listing rules, combined with TISE’s pragmatic and commercial approach to listings, often appeals to issuers from the United Kingdom, Europe, the United States and Asia.
Listing Sponsor Services
Appleby is a leading listing agent with TISE, which listed 1,111 securities during 2021 against the backdrop of the coronavirus (COVID-19) global pandemic. This is the highest annual total of new listings since the inception of TISE, and Appleby acted as listing agent on an increasing number of these listings, representing a 93% increase on 2020.
Appleby assists domestic and international entities looking for a primary or secondary listing on TISE. Our listings team is committed to delivering a highly professional and integrated service, coordinating the listing process, and supporting the issuer through their application. We also act as our client’s ongoing listing agent and assist them in meeting their continuing obligations as a listed issuer on TISE.
The International Stock Exchange
TISE is a regulated marketplace from within the European time zone but outside the European Union. TISE is a “Recognised Stock Exchange” by UK HM Revenue & Customs. Today there are more than 3,500 securities listed on TISE with a total market value of more than £500 billion. The majority of listings on TISE are for debt securities (including High Yield Bonds and Quoted Eurobonds) but TISE can also list other types of securities, such as REITs, Sustainable Bonds, Securitization Bonds, SPACs, other investment vehicles and equity listings.
Do get in touch with your usual Appleby contact should you wish to discuss.
What is TISE Sustainable?
TISE Sustainable is a segment on The International Stock Exchange (TISE) which is available to all TISE-listed issuers – including bond issuers and equity issuers – who comply with a recognised framework or rating that promotes environmental, social or sustainable activities.
