ACCIONA is a global developer of sustainable infrastructure solutions that tackle urgent issues such as global warming and water scarcity. When investing in new projects, it seeks to maximise its positive impact on local stakeholders. For instance, as part of the MacIntyre Windfarm project in Queensland (Australia), ACCIONA [1] has committed to help local farmers define strategies to decarbonise their own operations by providing them with a template decarbonisation strategy, containing specific transition plans and suggested GHG emission reduction targets. 

ACCIONA and NatWest worked together to develop a financial mechanism to support these “Local Impact” projects. This led to the establishment of a distinctive new Sustainable Impact Financing Framework. This includes the usual sustainable finance structures, as well as a commitment to direct the amount equal to the yield saving from issuing a bond or loan in ESG-labelled format, or the benefit of a coupon step-down on a sustainability-linked bond or loan, to support local initiatives which promote environmental or social co-benefits. 

ACCIONA’s business activities span the entire value chain from design and construction through to operation and maintenance. In 2021, ACCIONA Energía was spun off from ACCIONA Group to focus on renewable energy projects while at the same time boosting its ability to commit resources to the development of emerging technologies such as hybridisation, storage, and hydrogen.

In the role of Sole ESG Structuring Advisor, NatWest supported ACCIONA with refining its sustainable finance strategy, as well as arranging meetings with leading ESG investors to gather valuable feedback on the structural components of the new framework. 

The new framework combines three previous iterations published by ACCIONA and ACCIONA Energía to create a single “family” framework. Besides covering Green Use-of-Proceeds and Sustainability-Linked financing structures, the framework introduces the new Local Impact component which puts forward the development of initiatives that generate positive environmental and/or social outcomes at the local level. 

Each of the Local Impact indicators and targets introduced are designed to respond to urgent social needs and contribute to the achievement of ACCIONA’s 2030 agenda. These dual impact structures with their corresponding annual and total targets will be documented in the contracts for each instrument and are accounted for annually in the company’s Sustainable Finance Report, which is externally verified and published on both companies’ websites.

The framework, which has been established in accordance with the draft EU Green Bond Standard, ICMA Green Bond Principles 2021, LMA Green Loan Principles 2023, ICMA Sustainability-Linked Bond Principles 2023 and LMA Sustainability-Linked Loan Principles 2023, also aims to reinforce the Group’s sustainable financing instruments by introducing a clear set of commitments with respect to grey areas in common market practices such as refinancing, look-back periods, and grandfathering. 

DNV provided a Second Party Opinion concluding that the eligible green project categories are aligned with the EU Taxonomy substantial contribution to climate change Technical Screening Criteria, and that the corporate key performance indicators (for sustainability-linked structures) are relevant, meaningful and material to ACCIONA’s overarching sustainability strategy. It also notes that the Local Impact indicators are relevant and core to the company’s sustainability and business strategy.

José Luis Blasco, ACCIONA’s Global Sustainability Director, said: “The new ACCIONA Sustainable Impact Financing Framework marks a critical new milestone in our sustainability journey. It has allowed us to centralise our ESG treasury instruments and work with investors to channel funds both to corporate initiatives and specific local projects supporting stakeholders. NatWest’s support in devising and establishing this framework has been indispensable in achieving this outcome. It is a pleasure to work with a bank that shares our strong commitment to sustainability and sustainable finance.”

Pietro Stimamiglio, Corporate Climate & ESG Capital Markets, NatWest, commented: “We’re thrilled to have supported ACCIONA with the development of this innovative Sustainable Impact Financing Framework, which aims to set higher standards for issuers, lenders, and investors by delivering more transparency, accountability, and positive impact. This framework shows our commitment to contribute to social, economic and environmental progress in the UK and Europe as well as advancing the sustainable finance market by working together with sustainability leaders such as ACCIONA.”

Tom Gidman, ESG Advisory, NatWest, commented: “With more and more companies seeking investor support for a broad range of environmentally and socially impactful projects, we are committed to support firms, such as ACCIONA, and other organisations, at all stages of this journey – from benchmarking of their ESG strategy through to framework drafting, positioning and post-issuance reporting. We are proud to have supported many customers, across a range of sectors, to structure and execute inaugural frameworks and transactions which support and incentivise the achievement of sustainability objectives.”

[1] via its subsidiary ACCIONA Energía

Image: © ACCIONA Energía