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Social bonds — sold to fund causes such as building hospitals and schools — are likely to remain a “significant chunk” of the growing market for sustainable debt, even if issuance reduces as the Covid-19 pandemic eases, according to a S&P Market Intelligence report.

The value of bonds sold to fund social causes jumped nine-fold to nearly $165bn in 2020 from the previous year, S&P said, citing data from Environmental Finance, a global sustainable finance news and analysis provider.

The pandemic was the primary driver for social bonds in 2020 as investments in healthcare surged, Meredith Jones, head of environmental, social and governance at financial services firm Aon, told S&P. 

“With effective vaccines getting more widespread distribution, the peak of that crisis appears to be abating,” she said. 


“However, many issues which social bonds could address obviously still exist, such as access to critical infrastructure, affordable and workforce housing, socioeconomic advancement [and] access to education.”

The size of the overall ESG debt market nearly doubled to $608bn last year, from $326bn in 2019, according to Environmental Finance. 

Green bonds, typically used to fund climate change mitigation projects, at $296bn made up nearly half of the total ESG debt in 2020. Issuance of sustainability bonds, a hybrid of green and social debt, tripled to $140bn last year. Sustainability-linked bonds, which have specific performance targets, totalled $8.78bn, the data showed.

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Governments have been the biggest issuers of social bonds, seeking to help their economies climb out of the pandemic-induced downturn.

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