Research On Risks Of Sustainablility-linked Bond Issued By Sinochem International Cooperation

Human beings continuously recognize and transform the natural world,creating rich achievements in civilization,but it also brings serious environmental and climate issues.Energy conservation and emission reduction have become a global consensus.In 2020,China clearly put forward the goal of carbon peak and carbon neutrality,which has higher and clearer requirements for the low-carbon transformation of the economy.However,the existing scope of green finance support is limited by the Catalog of Green Bond Support Projects,which cannot cover the low-carbon transformation activities of traditional high carbon enterprises,resulting in limited financing for the transformation of high carbon enterprises.Therefore,to achieve the dual carbon goal,Financial innovation is still needed to promote low-carbon transformation activities in high carbon industries.Sustainable development linked bonds are a new type of transitional financial tool in China.With its unique bond structure and flexible fund utilization characteristics,they have increased the strength and quality of financial support for low-carbon transformation of high carbon enterprises.As of the end of December 2022,China has issued 58 bonds,among which on January 17,2022,Sinochem International issued "22Sinochem G1",becoming the first sustainable development linked bond in the chemical industry and the largest bond issued by Sinochem International with energy-saving and emission reduction properties.This article selects the "22 Sinochem G1" issued by Sinochem International for case analysis and research.The low-carbon transformation activities of high carbon enterprises often come with huge risks,making investors less willing to invest.Therefore,how to measure the risk of sustainable development linked bonds has become the direction of this article’s research.Firstly,this article analyzes the basic situation of sustainable development linked bonds.Secondly,it elaborates on the issuance of 22 Sinochem G1 bonds by Sinochem International.Finally,on the basis of existing literature and theoretical achievements,further risk analysis is conducted on the 22 Sinochem G1 bonds from the perspectives of transformation risk,interest rate risk,liquidity risk,and greening risk.The following conclusions are drawn: Firstly,when investors invest in sustainable development linked bonds,The pressure and risks faced by enterprises in transformation activities can be reasonably evaluated through stress testing and other methods.Enterprises should enhance their low-carbon transformation capabilities and alleviate the pressure of transformation risks;Second,sustainable development linked bonds have cost advantages for enterprises,and investors need to bear more interest rate risk at a lower interest rate.However,through the design of bond rights clauses,investors can be provided with risk compensation,which makes investors willing to bear interest rate risk,and provides better financing channels for enterprises;Thirdly,sustainable development linked bonds have higher liquidity and lower liquidity risk compared to ordinary corporate bonds;Fourthly,there are still shortcomings in the rationality of bond performance indicators and the fairness of third-party certification,which may lead to greenwashing risks.