SSA Social Bonds Roundtable (June 2025)

Social bonds have become an established part of the funding market for supranational, sovereign and agency borrowers, with a steady output of about €140bn a year from all kinds of issuer, since the exceptional surge during the pandemic.

Investors would like more, and large reservoirs of social spending in the public sector are not being tapped. Among governments, national and local, still only a minority use the instrument.

Meanwhile, investor demand is tangible but diffuse, often spread across a variety of funds and firms with environmental, social and governance awareness, rather than coming from dedicated social bond funds.

Investors who do pursue the product are thirsty for a broader spread of issuers and currencies — this year issuance has been 50% in euros and 63% from the public sector.

GlobalCapital brought together 10 leading issuers, investors and investment bankers in June to discuss their experiences and what the market needs to grow.

Speakers debated pricing dynamics, the scarcity factor, whether the Trump administration’s stance on ESG has affected the market, and whether defence can be considered social expenditure.

They argued investors want clarity on impact. That can be difficult to provide when impacts can take years to bear fruit, but issuers are learning to be more precise about the immediate outcomes the bonds finance, and which groups in society are benefiting from social investments.