The Kazakhstan Stock Exchange (KASE) and the Central Asian Institute for Ecological Research (CAIER) have agreed to jointly develop the sustainable finance market. Companies planning to issue green bonds will be able to receive expert assessment on preferential terms.
What happened
The memorandum was signed by Adil Mukhamedzhanov, Chairman of the Management Board of KASE, and Aselle Tasmagambetova, Founder of CAIER. The document gives exchange issuers access to the free preparation of an external assessment — a Second Party Opinion (SPO). This is a mandatory stage for issuing green, social, and other ESG bonds.
The agreement was announced at a joint practical seminar where financial market participants discussed the stages of preparation for issuing green securities.
Country and market
According to KASE, there are currently 49 sustainable finance instruments on the exchange's official list. Of these, 19 issues are classic green bonds. The total volume of funds raised across all ESG instruments has already exceeded 1.3 trillion tenge.
CAIER, for its part, recently entered the international register of external reviewers of ICMA (International Capital Market Association). This means that the institute's opinions are recognized globally and comply with global sustainable finance standards.
Why it matters
Issuing ESG bonds requires additional expenses for auditing, developing framework documentation, and certification. Often, it is the cost of external assessment that deters mid-sized businesses from using green instruments.
A free SPO from a recognized assessor removes the main financial barrier at the start.
The exchange is stimulating the influx of new issuers by shifting part of the infrastructure costs to the partner institute.
What's next
The market will now have to assess to what extent the free assessment from CAIER will increase the actual number of new green and social bond issues by the end of the year.