ICC Launched New Principles for Sustainable Trade Finance

The International Chamber of Commerce (ICC) introduced a new set of Principles for Sustainable Trade Finance (PSTF) at the Sibos 2024 conference in Beijing. Developed in collaboration with industry experts, financial institutions, corporates, and Boston Consulting Group (BCG), the PSTF provide a unified framework aimed at defining sustainable trade finance products. These principles seek to fill a gap in existing sustainable finance frameworks, which are often difficult to apply to trade finance due to its nature as a “flow” product that is not typically linked to specific, delineated projects.

The PSTF establish clear and transparent guidelines that enable banks, corporates, and investors to effectively direct capital toward sustainable and inclusive trade finance solutions. The principles also aim to mitigate the risks of greenwashing, ensuring that funds are genuinely aligned with sustainability goals. The PSTF outline specific approaches for green trade finance, sustainability-linked trade finance, sustainability-linked supply chain finance, and the ICC’s ambition for social trade finance.

With the launch of the PSTF, the ICC has opened a consultation period, inviting stakeholders across the trade finance industry to review the document and provide feedback. This collaborative process is designed to make the principles both practical and reflective of the industry’s diverse needs. The ICC has acknowledged the significant contributions of several financial institutions, including HSBC, Standard Chartered, Deutsche Bank, Santander, ING, Commerzbank, and BCG, in the creation of the principles. Once the consultation is complete, the finalized version of the PSTF will be released later this year, establishing it as a cornerstone for sustainable trade finance on a global scale.