Name BlackRock
Signatory type  Investment manager
Region of operation Global
Assets under management USD7trn
Geography Global
Sector Green bonds
Asset class Fixed income
Environmental objective Mitigation and adaptation
Economic activity All

We evaluated the tools available to assess the existing Green Bond (GB) market’s eligibility for the EU Green Bond Standard (GBS), which is designed for alignment with the EU taxonomy. We concluded that the EU GBS is a welcome addition to the growing transparency and credibility of GBs.

Taxonomy implementation

Principles, criteria, thresholds

We evaluated an Investment Grade Global Green Bond index and its potential alignment to the GBS by leveraging NACE codes for High Impact Sectors (BlackRock and Bloomberg WATC EUTAX mapping); proceeds mapping (BlackRock and Climate Bond Initiative analysis); and BlackRock Green Bond ratings.

Do no significant harm and sociable safeguards assessment

We explored Do No Significant Harm (DNSH) using frameworks from the Green and Social Bond Principles, issuer Green Bond Frameworks and UN Global Compact (UNGC)/global norms screening from external ESG rating providers.

Additional comments

We considered existing adherence to the requirement for impact reporting, third party verification and issuer EU GBS adherence.

Alignment results

We found that, while only 25% of the existing Green Bond Global Investment Grade market is eligible using NACE coding associated with turnover, at least 50%-60% of Use of Proceeds is aligned with the EU Taxonomy. We expect that proportion to increase over time as the taxonomy is further developed. We also see the taxonomy widening the Use of Proceeds categories within the GB market to include transition projects that align with the 2-degrees benchmark but are currently absent from GB funding. We believe DNSH should be managed at the issuer framework level, and through surveillance at parent issuer level. Only 2 of 236 issuers would be flagged for additional due diligence. We determined that existing alignment of the GB universe through impact reporting is 79%. Finally, while many GB programmes make use of third party verifiers, we recognise that these verifiers still lack certification and therefore complete alignment is not possible at present.

Use of proceeds mapping - BlackRock proprietary analysis

Use of proceeds mapping - BlackRock proprietary analysis

BlackRock’s ’Green scale’: focus on the eligible green projects

General principles:

  • What matters are what projects are financed by the bonds an how those projects contribute to meeting environmental goals.
  • We privilege climate-change-mitigation benefits over other positive environmental impacts.
  • Whenever possible, we factor in resiliency of assets (esp. assets with a long life) to climate change impacts.
  • Ideally, 100% of use of proceeds are applied towards green projects, but the minimum threshold we will consider is 90% towards green funding. In cases where only 90% of the funding is green, we will evaluate the issuance’s ‘greeness’ on a case-by-case basis depending on the application of funding the remainder 10%.

BlackRock’s ’Green scale’: focus on the eligible green projects

The green bondmarkets in figures: BlackRock greenness distribution

The green bondmarkets in figures: BlackRock greenness distribution


Challenges and solutions

1 Green bond use of proceeds breakdown percentages are often not available. We estimated through the use of available reporting and issuer engagement.
2 DNSH is not possible to assess on a per-project basis. We relied on the green bond framework, external ESG data provider monitoring and in- house engagement.


Though a large part of the GB market is in alignment, some minor adjustments and expanding additional metrics will enhance coverage. We fully support the concept of a GB label.