Societe Generale Pioneers Digital Green Bond with Ethereum Integration
Societe Generale has made a significant leap into the digital finance realm by issuing its inaugural digital green bond.
This landmark security token, directly registered by SG-FORGE on the Ethereum public blockchain, is set to revolutionize the landscape of sustainable finance with heightened transparency and traceability of ESG (Environmental, Social, and Governance) data.
The security tokens have garnered full subscription from two prominent institutional investors, AXA Investment Managers and Generali Investments, through a private placement, signaling strong investor confidence in this innovative financial instrument.
This pioneering transaction marks Societe Generale’s first foray into digital green bonds, leveraging the unique functionalities of blockchain technology. By adopting this digital format, the bank aims to enhance transparency, traceability, transaction fluidity, and speed in settlements, setting a new standard in the industry.
Structured as a EUR 10 million senior preferred unsecured bond with a 3-year maturity, the proceeds will exclusively finance or refinance Eligible Green Activities as per Societe Generale’s Sustainable and Positive Impact Bond framework. Notably, the Group has been a consistent issuer of Positive Impact Bonds since its inaugural issuance format in 2015.
This initiative represents a crucial stride towards utilizing blockchain as a data repository and certification tool.
According to the company, Societe Generale envisions using this technology to foster global transparency on ESG and impact data, aiming to provide issuers and investors with invaluable insights.
The digital green bond issuance incorporates two pivotal innovations, signaling a shift towards greater transparency and accessibility:
- Carbon Footprint Information: The bond’s smart contract offers real-time access to information regarding the carbon footprint associated with the digital bond infrastructure. This move empowers issuers and investors by enabling them to measure the carbon emissions of their securities within the financial infrastructure.
- On-Chain Settlements: Investors are provided with a new avenue to settle securities on-chain through the EUR CoinVertible, SG-FORGE’s digital asset introduced earlier in April 2023. This innovative step complements traditional cash settlement solutions, showcasing the diverse capabilities of SG-FORGE in providing a full spectrum of on-chain services.
Societe Generale views this transaction as a testament to its commitment to innovation in the digital finance domain. In fact, this move not only enhances the Group’s debt capital market capabilities but also meets the growing demand among corporate and institutional clients for digital assets, particularly those emphasizing ESG considerations.
