Assess – Balance – Calibrate: Leveraging the ABC Score™ to Align Post-Issuance Practice with Sustainable Development Goals
Increased private sector investment is needed to help fill the $4 trillion gap in annual SDG investment in emerging markets and developing economies
Unlocking
greater long-term investment in SDGs will require policies that promote the
long-term development of capital markets and institutional investors. Global
financial markets rely on confidence in the issuance of stocks, bonds and loans
to finance sustainable economic growth. The post-issuance phase, which includes
the use of proceeds in investment projects, the trading of securities after
they are first issued, the management of loans and the safekeeping of assets,
forms the vital liquidity engine of modern finance. Yet this phase often
remains insufficiently governed, leading not only to systemic risks but also to
losses that ultimately fall on beneficiaries such as pensioners, small and
medium-sized enterprises (SMEs) and customers. These post issuance outcomes
also shape the real economy, affecting market trust and the ability of finance
to support sustainable development
As
Global PSSL’s recent peer-reviewed report on green
bond transparency showed that weak
oversight can allow proceeds to be misused and credibility to be undermined.
The report also highlighted deficiencies already identified by law and
regulation, underscoring the systemic nature of the problem.
Such
risks – whether in securities lending, fragmented collateral policies, or
shareholder engagement – can erode both market integrity and the sustainability
agenda. Building on this work, we are now preparing the Beyond Issuance
reports, which will be issued in at least two parts over the coming months and
will inform the further development of the ABC Score™. The ABC Score™ initiative
aims to identify and address these vulnerabilities and to extend oversight
beyond green bonds to the broader world of stocks and bonds in their
post-issuance lifecycle.
Assess – Balance – Calibrate
In a
rapidly changing financial world, ABC (Assess – Balance – Calibrate) is more
than an abbreviation; it is a method for navigating the complexity of
post-issuance markets. The ABC Score™ will help organisations assess market
behaviours in real time; balance the often-competing interests of investors,
issuers, and regulators, and calibrate their responses as conditions evolve.
With the support of AI and advanced analytics, and
with strong human oversight at every stage, this framework provides a way to continuously
monitor secondary market practices and adjust governance in line with emerging
risks and opportunities. In this way, the ABC Score™
aims to embed resilience into the very fabric of post-issuance finance.
Filling the Gap
The ABC
Score™ initiative from Global Principles for Sustainable Securities Lending (Global
PSSL) seeks to fill the gap in post-issuance financial oversight. The initiative
draws on a growing group of financial advisors and fintech specialists working
in risk management. Their combined expertise will help ensure the Score
develops both as an analytically robust and credible investment opportunity.
In a field marked by conflicts of interest, our experience has
shown that governance initiatives must remain impartial to succeed in the long
term. That is why the ABC Score™ initiative will always be anchored in
multi-stakeholder support, ensuring independence, transparency, and legitimacy.
Building Confidence through Peer Review
We
place independent peer review at the heart of the ABC Score’s development. The
initiative builds on the foundation of significant peer-reviewed funding from
the UK’s Economic and Social Research Council (ESRC), part of UK Research and
Innovation, through Exeter Law School. A key formal condition of that funding
was to ensure independence and resist capture, which has been consistently
delivered on since 2018. This independence has remained intact while being
complemented by carefully targeted financial assistance from industry
stakeholders.
Over
the last few months, Global PSSL has secured several high-profile reviewers for
its incoming Beyond Issuance reports, which will include additional
draft metrics for the ABC Score™. These reviewers come from across the asset
owner, financial advisory and fintech communities and bring the range of
expertise needed for the next stage of our work. We have also secured a review
from a senior official at the United Nations Environment Programme Finance
Initiative.
The
recent workshop, Beyond Issuance: Confronting Hidden Risks and Advancing
Transparency in Capital Markets, held on October 16 in Washington DC, was a
turning point. Key stakeholders encouraged us to continue developing the ABC
Score™, and some asset owners indicated that they already work with the
recommendations in this report. These exchanges confirmed something we have
always understood in practice: governance standards only gain real legitimacy
when they are examined openly and tested by a wide range of experts.
Global
PSSL’s work in securities lending has demonstrated how governance gaps, when
left unchecked, can exacerbate risks and erode trust. Drawing on our own
senior-level experience within an industry association, we have seen first-hand
the limits of approaches confined to narrow interest groups. The ABC Score™ will
therefore be deliberately anchored in a broader, multi-stakeholder and the Beyond
Issuance reports provide the right platform to secure the level of peer
review needed to strengthen its future development.
Encouraging Broad Adoption, Guarding against Complacency
The
ABC Score™ is designed as a fintech mechanism for a wide range of
organisations, not a narrow industry construct. It emphasises transparency,
stakeholder involvement, and continuous improvement – shaped through
collaboration and maintained in the public interest. Yet governance only
matters if it is taken seriously: continued opacity and weak standards threaten
not only market stability but also the credibility of sustainable finance.
Without stronger transparency, blind spots in post-issuance markets will
persist and undermine progress toward United Nations SDGs.
Mobilising the United Nations Community
The United Nations is uniquely positioned to foster both
legitimacy and scale in strengthening post-issuance governance. Drawing on the
success of attracting a wider community of reviewers for the Beyond Issuance
reports, Global PSSL proposes that UNU coordinate a UN community of practice
for the ABC Score™. Such a forum could convene UN specialists alongside other
stakeholders to help refine metrics and ensure the Score evolves in step with
global challenges and innovations such as stablecoins and digital markets.
This is also a significant opportunity for the United Nations. The
ABC Score™ is designed to become an investment opportunity anchored in
independence and impartiality, minimising the risks of industry capture while
offering more than the fragile alliances that have too often characterised
sustainable finance and transparency initiatives.
Looking Ahead
The ABC Score™ is
evolving, not finalised. Its lasting value will depend on strong and continued
peer review and broad engagement. It holds the potential for universal benefit:
bolstering transparency and resilience in financial markets while equipping
investors and policymakers with clearer insight into complex post-issuance
dynamics.
The
way markets are governed after securities are issued is central to both
financial stability and sustainable development. Weak governance in this
post-issuance phase erodes trust, while strong governance reinforces integrity,
unlocks long-term value, builds systemic resilience, and directly supports the
implementation of the 2030 Agenda for Sustainable Development.
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