Introduction and history

The Handbook: Harmonised Framework for Impact Reporting for Social Bonds highlights that overcoming global development challenges requires significant investment in projects generating positive social impacts. Social bonds channel liquidity to address challenges like those in the Sustainable Development Goals (SDGs). These instruments align with the four core principles of the Social Bond Principles (SBP), where proceeds exclusively finance eligible social projects targeting specific populations. This document summarises conclusions from the Social Bond and Impact Reporting Working Groups to catalyse discussion among issuers and investors.

Core principles and recommendations for reporting

Reporting is a core component of the SBP, requiring issuers to report on the use of proceeds and expected social impacts on target populations at least annually. Quantitative performance measures are recommended alongside qualitative indicators. Issuers should define and disclose the process for including or removing projects from reports, such as once a project is deemed eligible or if it experiences issues affecting impact. Reports should indicate total signed amounts and proceeds allocated to disbursements.

Issuers are encouraged to identify social project categories and relevant target populations, explaining why groups are considered underserved or vulnerable. Reporting can occur on a bond-by-bond or portfolio basis. Impact reports should illustrate expected outcomes based on ex-ante estimates for a representative year or annual actual ex-post impacts. Issuers should report the pro-rated share of overall results based on their percentage of total financing. Transparency regarding methodology, assumptions, and partial eligibility is highly recommended to facilitate comparison and understanding.

Sector specific guidance and reporting metrics

Specific guidance is provided for several categories. Affordable Housing projects include housing development, acquisition, and upgrading. Core indicators include the number of people reached, units constructed or improved, and the number of outstanding loans or subsidies. Affordability is defined by income levels or local regulations. Access to Essential Services includes education, healthcare, and financial services. Education metrics track students benefiting and facilities built, while healthcare focuses on people treated and professionals trained. Financial services metrics include the number of people receiving financial interventions and SMEs financed.

Affordable Basic Infrastructure encompasses energy, transport, water, sanitation, and digital infrastructure. Energy projects focus on expanding reliable electricity and clean cooking programmes to alleviate energy poverty. Transport projects prioritise equitable access to safe and sustainable transport. Water and sanitation projects aim for universal access to clean water and wastewater treatment. Digital infrastructure metrics include new subscribers and the number of people gaining first-time internet or mobile access. Issuers are encouraged to disaggregate results by gender, age, geography, and income level where possible.

Annex I – Impact confirmation on target population

Impact confirmation involves collecting data from target populations to assess project effectiveness and mitigate risks of impact washing. While recommended, this process is voluntary and can be conducted pre-issuance to verify assumptions or post-issuance to confirm actual outcomes. This bottom-up approach improves reporting transparency and can involve third-party support for data collection or digital surveys.

Annex II – Illustrative summary template for social project-by-project report

The handbook provides a summary template for project-by-project reporting, which is available in Excel format on the ICMA website. The template includes fields for project categories, target populations, signed amounts, allocated proceeds, and specific core social indicators.

Annex III – Working list of sample social indicators

This annex provides an illustrative list of quantitative social indicators categorised by output, outcome, and impact. Outputs are tangible products or services, such as dwellings built. Outcomes are changes resulting from activities, like reduced rental costs. Impacts are broader, long-term outcomes, such as reduced health issues related to homelessness. The document emphasises that indicators should match project objectives and avoid inclusion merely for the sake of reporting.

Annex IV – Potential environmental and/or social risks associated with eligible project categories

Issuers are encouraged to communicate processes for managing perceived social and environmental risks. Potential green risk metrics include air pollution, biodiversity loss, and greenhouse gas emissions. Social risk metrics cover affordability, community consultation, labour standards, and food insecurity. This risk assessment ensures a holistic understanding of project impacts beyond core social benefits.