MANILA - The Securities and Exchange Commission said Tuesday it backed the issuance of social bonds to support efforts to contain COVID-19 and to manage the socioeconomic impacts of the pandemic.
Social bonds are exclusively used to fund or refinance projects seeking to address or mitigate specific issues such as the pandemic, the SEC said. The bond is a "potential" funding source for COVID-19 projects, it said in a statement.
“COVID-19 has given rise to serious socioeconomic issues globally, pushing enterprises to the brink of failure and leaving millions of people jobless,” SEC Chairperson Emilio B. Aquino said.
“The social bond market could boost our response to and recovery from the pandemic by unlocking the much-needed capital for the promotion of public health, reopening of businesses and preservation of jobs, among others," he added.
The agency recently approved the country's first social bond or the Bank of the Philippine Islands' COVID Action Response (CARE) Bonds in line with the ASEAN Social Bond Standards, it said.
With its CARE bonds, BPI hopes to raise at least P3 billion to support micro, small and medium enterprises. This is the first ASEAN social bonds to fund projects aimed at mitigating impact of the COVID-19 pandemic, the SEC said.
Different industries, including pharmaceutical, financial, and manufacturing, should also explore the social bond market "to pursue socially relevant and impactful projects, especially in this time of unprecedented global health and economic crisis," Aquino said.
The SEC said social bonds have gained popularity among issuers and investors worldwide.