Sustainability-linked loans, or SLLs, have only been around for a few years. In that short time, they have ballooned into a market worth $1.5 trillion. But now, as scrutiny comes for sustainability claims with no substance, that market faces a reckoning. And so do the banks that lent those money. The first sustainability-linked loan was the work of Dutch ING Groep and was closed in 2017. Since then, sustainability-linked loans have become the second-largest ESG market in the world, after so-called green bonds. The essence of SLLs is that the borrower…
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