Can you have a groundhog year?
It certainly feels like 2020 is set to repeat many of the big themes of 2019. Brexit is still about to happen (and even if it does, we’re going to spend the year having the same interminable arguments about trade deals/no-deals/WTO terms); the US-China trade war rumbles on with no end in sight; Donald Trump is about to be impeached (or not); the US is heading into recession (or not); the ECB is buying bonds again in the hope that this time quantitative easing will get the eurozone fit and firing.
Same old, same old.
But some things are changing; some of them even for the better.
There is, for instance, an increasing and welcome focus on what the finance industry can do to address the growing climate crisis – and other crucial social and governance issues.
In order to reflect that positive change, we have added several new categories to our ESG awards and appointed a senior editor to run our ESG financing coverage. She will devote all her efforts and time to covering ESG deals and news.
In fact, one of the issuers we highlight in this Review of the Year might provide a template in the fight against climate change.
Enel, our ESG Issuer of the Year, pioneered a structure – the so-called SDG bond – that deserves to be copied by others.
And here a mea culpa. Not long after the deal came out, IFR wrote a critical editorial suggesting that the deal was not properly accountable to investors and other outside observers. There is some truth in that.
But after hours of discussion among ourselves, with investors, issuers (including Enel) and bankers we’ve come to the conclusion that we got it wrong. In fact, all being well (and assuming the structure is not abused by those less well suited to it), SDG bonds will speed the transition to a lower-carbon future in a way that true green bonds may simply not be able to.
But we were right to be sceptical about some aspects of the ESG financing market. It is after all our job sort the chancers from the serious; the charlatans from the committed. And we will continue to do so.
But it is also our job – at least on this one occasion every year – to celebrate the achievements of the banking and finance industry. And there is much to be celebrated, as the following pages make clear. A host of clever deals, interesting structures, shrewdly judged sales pitches and well-timed launches.
So chapeau to all. Let’s do it again next year.