New investor-published guidelines for transition bonds could expand sustainable finance to a broader variety of conventional businesses.

On June 12, 2019, AXA Investment Managers published an article calling for the market to recognize transition bonds, a new category of thematic sustainable finance. AXA’s call to action and suggested guidelines (Transition Bond Guidelines) reflect an evolution in how investors grapple with bringing conventional businesses into the sustainable finance world. Transition bonds have the potential to create opportunities for a tremendous number of businesses not traditionally seen as sustainable to participate in sustainable finance, but would still be limited to businesses committed to robust transition strategies.