A&O Shearman represents the Republic of Chile on its first bond with biodiversity KPI components

The 2036 Notes incorporate two biodiversity key performance indicator components: (i) protected areas and/or other effective area-based conservation measures in terrestrial ecosystems as a percentage of Chile’s total national land surface area, and (ii) terrestrial ecosystems in protected areas that meet key effectiveness metrics as a percentage of Chile’s total national land surface area. The interest rate on the 2036 Notes will increase, decrease or remain the same depending on whether Chile meets such components at certain date.

“Chile’s latest sustainability-linked bond underscores its role as a sovereign innovator, marrying climate ambition with nature-positive finance by embedding two biodiversity KPI components directly into its capital markets strategy,” said A&O Shearman Capital Markets partner Alejandro Gordano. “The transaction advances the sustainability-linked format beyond emissions alone, provides a replicable template for other sovereigns, and reinforces the momentum behind integrating biodiversity risk and opportunity into portfolio construction.”

A&O Shearman recently advised the initial purchasers in connection with bond offerings by Chile’s CODELCO, the Republic of Uruguay, and the Province of Santa Fe, Argentina.

The A&O Shearman team was led by New York-based Capital Markets partner Alejandro A. Gordano and included Capital Markets visiting attorneys Moises Gonzalez Arroyo and Teresa Zuniga, Tax partner Lorenz Haselberger, and Tax associates Daniel Kachmar and Edgardo Martinez Gastelum.