Skip to main content
The Globe and Mail
Support Quality Journalism.
The Globe and Mail
First Access to Latest
Investment News
Collection of curated
e-books and guides
Inform your decisions via
Globe Investor Tools
Just$1.99
per week
for first 24 weeks

Enjoy unlimited digital access
Enjoy Unlimited Digital Access
Get full access to globeandmail.com
Just $1.99per week for the first 24weeks
Just $1.99per week for the first 24weeks
var select={root:".js-sub-pencil",control:".js-sub-pencil-control",open:"o-sub-pencil--open",closed:"o-sub-pencil--closed"},dom={},allowExpand=!0;function pencilInit(o){var e=arguments.length>1&&void 0!==arguments[1]&&arguments[1];select.root=o,dom.root=document.querySelector(select.root),dom.root&&(dom.control=document.querySelector(select.control),dom.control.addEventListener("click",onToggleClicked),setPanelState(e),window.addEventListener("scroll",onWindowScroll),dom.root.removeAttribute("hidden"))}function isPanelOpen(){return dom.root.classList.contains(select.open)}function setPanelState(o){dom.root.classList[o?"add":"remove"](select.open),dom.root.classList[o?"remove":"add"](select.closed),dom.control.setAttribute("aria-expanded",o)}function onToggleClicked(){var l=!isPanelOpen();setPanelState(l)}function onWindowScroll(){window.requestAnimationFrame(function() {var l=isPanelOpen(),n=0===(document.body.scrollTop||document.documentElement.scrollTop);n||l||!allowExpand?n&&l&&(allowExpand=!0,setPanelState(!1)):(allowExpand=!1,setPanelState(!0))});}pencilInit(".js-sub-pencil",!1); // via darwin-bg var slideIndex = 0; carousel(); function carousel() { var i; var x = document.getElementsByClassName("subs_valueprop"); for (i = 0; i < x.length; i++) { x[i].style.display = "none"; } slideIndex++; if (slideIndex> x.length) { slideIndex = 1; } x[slideIndex - 1].style.display = "block"; setTimeout(carousel, 2500); } //

TMX’s new trading venue goes live Monday.

GEOFF ROBINS/AFP/Getty Images

TMX Group Ltd. , the parent company of the Toronto Stock Exchange, is launching a trading platform for sustainable bonds, giving retail investors the rare chance to buy and sell ESG-friendly debt while offering issuers a new source of capital to help Canada transition to a low-carbon economy.

For years, debt markets have been dominated by institutional investors who buy and sell bonds over-the-counter – that is, through investment banks in an opaque marketplace.

TMX’s new trading venue, which goes live Monday, allows retail investors to trade sustainable debt. Practically speaking, it means ordinary investors can trade qualifying bonds just like they would stocks, or purchase them and hold the debt until it matures.

Story continues below advertisement

Beyond Canada’s borders, Nasdaq runs a Sustainable Bond Network, which is targeted to institutional investors and lists qualified sustainable bonds. TMX’s platform allows the debt to be bought and sold through online brokerages or through an investment adviser.

The goal of the Canadian project is twofold, said Rob Catani, a former bond trader who now works for TMX: to help investors who are increasingly conscious of environmental, social and governance principles access ESG-focused debt, and to create a new funding source for the issuers of sustainable bonds.

Sustainable bonds encompass three categories of debt: green bonds, which provide environmental benefits; social bonds, which create a positive social outcome in the near future; and transition bonds, which help organizations move to a lower carbon future.

To start, the TMX project offers $13-billion worth of green bonds from eight issuers, but the company has plans to expand the venue. “It’s only going to grow,” Mr. Catani said. TMX has signed on National Bank Financial and TD Securities to serve as market makers for all bonds on the platform.

The debt currently available for purchase has coupons ranging from 0.75 per cent to 3.25 per cent, and the maturities range from 2022 to 2051.

Green bonds have existed for years, but in their infancy they were little more than regular debt that was marketed in a special fashion. More recently, the ESG movement has created a framework to make them distinct from ordinary debt.

For one, their use of proceeds has been made transparent, and the money can only be put toward green projects. The bonds are also required to have a second opinion that is issued by a recognized independent third party.

Story continues below advertisement

Proceeds from the bonds issued by the province of Quebec that trade on the platform, for instance, can only be used for specific projects that generate tangible benefits for protecting the environment, reducing greenhouse gas emissions or adapting to climate change in Quebec.

Currently, the bonds available for purchase on TMX’s new platform are issued by governments or supranational agencies, such as the Asian Development Bank. The goal is to add corporate bonds in the future.

“We’re expecting more issuers to join as this market develops,” said Sean St. John, an executive vice-president at NBF, adding that the bank believes there are multiple benefits to the project. “We see this as supporting our clients [debt issuers] with another source of capital, supporting retail by proving better access and transparency as well as furthering our commitment to the growing ESG market.”

Your time is valuable. Have the Top Business Headlines newsletter conveniently delivered to your inbox in the morning or evening. Sign up today.

Your Globe

Build your personal news feed

  1. Follow topics and authors relevant to your reading interests.
  2. Check your Following feed daily, and never miss an article. Access your Following feed from your account menu at the top right corner of every page.

Follow the author of this article:

Follow topics related to this article:

View more suggestions in Following Read more about following topics and authors
Report an error Editorial code of conduct
Tickers mentioned in this story
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

If you do not see your comment posted immediately, it is being reviewed by the moderation team and may appear shortly, generally within an hour.

We aim to have all comments reviewed in a timely manner.

Comments that violate our community guidelines will not be posted.

UPDATED: Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies