Euronext - 2020 Universal Registration Document

Euronext, a Sustainable Exchange

ESG Dashboard 2020

Issues from the EU under its Support to mitigate Unemployment Risks in an Emergency (SURE) programme contributed to record- breaking social bond issuance. The EU raised €39.5 billion from SURE social bonds during Q4 2020 alone and these issues listed on the Luxembourg Stock Exchange. French agency issuance of social bonds totalling €33.3 billion from Cades and Unédic made up the bulk of social bond issuance listed on Euronext markets. The use of proceeds for these social bonds were in response to the Covid-19 pandemic and focused on supporting employment and SMEs. Sustainability-linked bonds still form a very small proportion of the ESG bond issuance market but this sector received a significant boost from the publication of Sustainability-Linked Bond Principles from the International Capital Markets Association (ICMA). ENEL, Schneider Electric and Orpea listed sustainability-linked bonds on Euronext markets through Q4 2020 and this sector is expected to grow significantly through 2021. The pace of issuance growth in the green bond market slowed significantly through 2020 but issuance still increased by 2.66% – up to €219.51 billion from €213.82 billion in 2019. Green bond issuance as a share of ESG bond issuance fell frommore than 80% in 2019 to 51% in 2020. There were no ESG bond issues through 2020 which were labelled as “blue bonds”. There were a number of green bonds where proceeds were directed almost exclusively to marine and water related activities but the parties to the transaction labelled and marketed these issues as “green bonds”, e.g. Mowi ASA. Development of “blue bonds” as a distinct category will be difficult in the absence of specific tagging of “blue” within existing ICMA Principles. The number of $2 billion+ ESG bond issues globally in 2020 increased to 50 through 2020 from 15 in 2019. 38% (19 deals) of these issues listed on Euronext markets. Over a quarter (26+%) of total global ESG bond issuance through 2020 listed on a Euronext market.

ESG Bond issuance listed on Euronext markets totalled €115.85 billion through 2020 and represents a 76% increase on the €63.47 billion listed through 2019. The number of ESG bonds listed through 2020 also increased from 2019 – up 50% from 139 bonds to 208.

FIGURE 3: EURONEXT 2020 LISTINGS PER ESG BOND TYPE

in € bn

80

70

60

3

50

40

30

20

10

0

Green

Social

Sustainability

Sustainability-Linked

ESG bond types listing on Euronext markets diversified considerably through 2020 with social bonds in particular forming a larger proportion of total issuance – 39.5%. This brings the percentage of social bonds in nominal issuance terms to over 18% of all ESG bond listings on Euronext markets. This also reduces Euronext’s dependence on green bond issuance which now forms 75% of total issuance – down from 95+% by end 2019.

FIGURE 4: OUTSTANDING ESG ISSUANCE AMOUNT PER EURONEXT LOCATION

in € bn

150

FIGURE 2: GROWTH OF ESG BOND ISSUES LISTING ON EURONEXT

120

90

in € bn

120

60

105

90

30

75

0

60

Amsterdam Brussels

Dublin Lisbon

Oslo

Paris

45

30

ESG bonds are listed on all Euronext markets with Paris being the leading listing location in terms of an outstanding issue amount of €138.44 billion. France has become a global leader in ESG bond issuance and regularly trades the quarterly global No. 1 issue spot with the US and China. All ESG bonds listed in Paris are from French issuers. Dublin is also a very strong listing venue for international issuers from the Nordics, Italy and Spain for example. Whilst €71.19 billion ESG bonds are listed

15

0

2012

2013

2014

2015

2016

2017

2018

2019

2020

87

2020 UNIVERSAL REGISTRATION DOCUMENT