Arabic Sustainability Dictionary

Sovereign debt

Debt issued or guaranteed by a national government; PCAF attributes its emissions to the country.

Stranded assets

Assets that suffer unanticipated or premature write-downs or devaluation, for example fossil fuel reserves affected by climate policy or market shifts.

Substantial contribution

The EU Taxonomy condition that an activity significantly advances at least one environmental objective by meeting its technical screening criteria.

Sustainability bond

A bond whose proceeds finance a combination of green and social projects.

Sustainability performance target (SPT)

A measurable improvement in a key performance indicator, set within a given timeline, to which the terms of a sustainability-linked instrument are tied.

Sustainability-linked bond (SLB)

A general-purpose bond whose financial or structural characteristics, such as the coupon, change depending on whether the issuer achieves predefined sustainability targets.

Sustainability-linked debt

Debt instruments whose financial terms, such as the coupon or margin, change depending on whether the issuer meets predefined sustainability performance targets.

Sustainability-linked loan (SLL)

A loan whose margin or other terms vary according to the borrower's performance against predetermined sustainability performance targets.

Sustainable finance

Financial services and products that take environmental, social and governance considerations into account in lending and investment decisions.

Taxonomy-aligned activity

An eligible activity that makes a substantial contribution to an environmental objective, does no significant harm to the others and meets minimum safeguards.

Taxonomy-eligible activity

An economic activity that is described in the EU Taxonomy, regardless of whether it meets the technical screening criteria.

Technical screening criteria

The detailed thresholds and conditions set in the EU Taxonomy delegated acts that determine substantial contribution and do-no-significant-harm for each activity.

Transition finance

Financing that supports high-emitting companies and sectors in credibly reducing their emissions towards net zero.

Use of proceeds

The requirement that funds raised through a green, social or sustainability instrument be allocated to eligible projects.

Weighted average carbon intensity (WACI)

A portfolio metric equal to the average of investees' emissions per unit of revenue, weighted by each holding's share of the portfolio.