Revised Sustainability Linked Loan Principles and accompanying Guidance

In April 2021, the Asia Pacific Loan Market Association (APLMA), the Loan Market Association and the Loan Syndications and Trading Association announced the publication of a revised version of the Sustainability Linked Loan Principles (SLLP) and accompanying Guidance on Sustainability Linked Loan Principles (SLLP Guidance) reflecting recent market trends.

Key amendments include:

  1. tightening the language regarding the selection of key performance indicators (KPIs) and the scope of sustainability performance targets (SPTs) to provide greater clarity; and

  2. making mandatory the need for independent and external verification of a borrower's performance level against each SPT for each KPI.

The SLLP have also been structurally adjusted to align with the International Capital Market Association's Sustainability Linked Bond Principles.

All transactions completed prior to 3 June 2021 will be exempt from following the revised SLLP, and instead should be reviewed in conjunction with the SLLP published in May 2020.

The SLLP is accessible here: link (APLMA member login required).

The SLLP Guidance is accessible here: link (APLMA member login required).