The Equator Principles is a risk management framework adopted by financial institutions, for determining, assessing and managing E&S risk in projects.
Societe Generale considers the Environmental and Social (E&S) issues associated to its activities to better control their impact and promote good E&S practices. To this end, the bank has defined E&S General Guidelines, as well as E&S policies which set key standards and parameters for a responsible engagement. This E&S framework encompasses the initiatives of the banking sector that Societe Generale has joined, including the Equator Principles (EP) which the bank adopted in 2007.
Equator Principles Report
The objective of the Equator Principles Implementation Report is to share information with our stakeholders regarding how Societe Generale apply the Equator Principles. Annual public reporting is one of the commitments the bank has made when joining this initiative.
In 2020, 69 transactions, namely 49 project finance transactions, 12 project-related corporate loans, 2 bridge loans and 6 project finance advisory mandates falling within the scope of the Equator Principles III (2013) or IV (2020), were closed. Among these transactions, 51% are related to renewable power projects, which account for 98% of Equator Principles financings closed in the power sector.
Scope of the Equator Principles
The Equator Principles apply globally, to all industry sectors and to four financial products:
Bridge Loans with a tenor of less than two years that are intended to be refinanced by Project Finance or a Project-Related Corporate Loan that is anticipated to meet the relevant criteria described above.
Project-Related Corporate Loans
Project-Related Corporate Loans where all three of the following criteria are met:
- The majority of the loan is related to a Project over which the client has Effective Operational Control (either direct or indirect).
- The total aggregate loan amount and the EPFI’s individual commitment (before syndication or sell down) are each at least US$50 million.
- The loan tenor is at least two years.
Project-Related Refinance and Project-Related Acquisition Finance
Project-Related Refinance and Project-Related Acquisition Finance where all of the following three criteria are met:
- The underlying Project was financed in accordance with the Equator Principles framework.
- There has been no material change in the scale or scope of the Project.
- Project Completion has not yet occurred at the time of the signing of the facility or loan agreement.