Germany’s Daimler has issued a groundbreaking 10-year green bond to accelerate the clean transportation transition.
Daimler, a commercial vehicle and premium auto manufacturer (and maker of Mercedes Benz cars), has issued a €1bn, 10-year green bond – a landmark transaction in the ESG (environmental, social and governance) field, demonstrating the role of an automotive company in the transition to a low-carbon economy.
The bond – for which BNP Paribas was a joint bookrunner – is guided by the Daimler group’s green finance framework, which received the highest possible rating from independent assessor CICERO.
Investor momentum was very strong for the inaugural bond. The trade was 4x oversubscribed, highlighting the role investors are playing in helping corporates to transition their business model sustainably by accessing the green bond market.
The Daimler green bond demonstrates how corporates are increasingly tapping the sustainable capital markets to engage on transition. Clean transportation and the decarbonisation of the automotive sector are key considerations in the latest EU Sustainable Finance Taxonomy. The taxonomy sets performance thresholds to encourage companies to improve their environmental performance as well as helping investors identify what is considered eligible for sustainable investment, serving as a useful compass for capital markets to support the transition towards a low carbon economy.