In May 2023, the German state of North Rhine-Westphalia issued its 10th sustainability bond. The €2 billion ($2.2 billion) bond referred to green and social projects across the state, including affordable housing, clean transportation, renewable energy, food security and sustainable food systems and affordable basic infrastructure.

For the first time, North Rhine-Westphalia set out how the 41 social projects align with the proposed EU's social taxonomy, with many of them contributing to one or more of the taxonomy's core objectives.

The majority of the bond's social projects target the objectives of inclusive and sustainable communities and societies as well as adequate living standards and well-being for end users.

The bond tackles environmental issues such as sustainable water management, pollution prevention and control as well as environmentally sustainable management of living natural resources and land use.

North Rhine-Westphalia did not only show the alignment of the environmental projects with the EU Taxonomy Climate Delegated Act. Also for the first time North Rhine-Westphalia, set out the alignment of its biodiversity strategy − which forms part of the Protection of Nature project − with the proposed criteria of the Environmental Delegated which was deemed as a first for a sub-sovereign issuer.

The bond was praised for its transparency and the scale of information that was provided to investors, including annual impact reports developed by the Wuppertal Institute for Climate, Environment and Energy which are published post-issuance. These reports also include a financial allocation report created by the Ministry of Finance of the state.

"Since the issuance of our first sustainability bond in 2015, the State's sustainability bonds have evolved and improved. We are very transparent towards our investors and always provide them with detailed information, for example on alignment with the EU Taxonomy. We are proud of our pioneering role in the market and very delighted to see that our efforts are appreciated by market participants as this award clearly demonstrates." said Dr. Marcus Optendrenk, minister of finance of the State of North Rhine-Westphalia.

Investors were largely comprised of banks and fund managers.